Apple Pays $2.6 Billion Toward $4.5 Billion Winning Bid for Nortel Patents

By Maureen O'Gara	Article Rating:
July 28, 2011 09:00 AM EDT	Reads:	925

Apple's contribution to the winning $4.5 billion Rockstar bid that plucked the fabled Nortel patents out of Google's hands is $2.6 billion, better than half the record-setting price.

Barclays Capital analyst Ben Reitzes found the number buried deep in the 10-Q Apple filed last week.

RIM previously said it was kicking about $770 million into the pot and Ericsson said it was for good for $340 million, which means that the other Rockstar players, namely Microsoft, EMC and Sony, are getting off cheap, collectively less than the Google $900 million stalking horse bid that established the auction's floor.

What everybody now wants to know is what rights attach to these sums.

Apple joined Rockstar after the fifth round; Intel and Google got together after the eighth. The Google-Intel team went to $4.4 billion then threw in the towel giving the portfolio to the Apple-Rockstar consortium on the 19th round.

The Nortel portfolio, said to touch nearly every aspect of telecommunications, holds 6,000 patents and patent applications that span wireless, wireless 4G, data networking, optical, voice, Internet, search, social networking, service provider and semiconductors.

Google and Apple are now thought likely to tussle over InterDigital's 8,800 patents on stuff like transmitting wireless data and canceling noise interference. Besides 2G and 3G wireless widgetry, it may have more fourth-generation wireless patents than Nortel. Bloomberg figures it's got 1,300 patents related to mobile phone technologies used to transfer information.

Since putting itself up for sale and hiring banks, InterDigital's market cap has jumped to around $3.23 billion, up like $1.4 billion, pushing its purchase price to upwards of $5 billion according to Bloomberg.

The Jefferies Group calculates that buying InterDigital could save Apple $3-$10 a handset, making it worth somewhere between $3 billion and $10 billion.

On Tuesday InterDigital complained to the International Trade commission seeking to block imports of Nokia, Huawei and ZTE phones over 3G patents.

Published July 28, 2011 Reads 925
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Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025. Twitter: @MaureenOGara

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