To date, Nortel’s asset sales (aka “The Nortel Garage Sale”) have been interesting but not terribly exciting unless you take into account the public temper tantrums that Research in Motion had after it wasn’t allowed to participate in the auction for Nortel’s CDMA wireless business and LTE R&D unit.
But it looks like things could get really interesting as the remaining parts of the Nortel’s empire go on the block. In particular, Nortel’s patent portfolio is likely going to attract a huge amount of attention and multiple bidders looking to buy parts or all of Nortel’s 5,00o or so patents, including the highly sought after LTE patents.
A case in point is Ottawa-based Mosaid Technologies. which has publicly expressed its interest in Nortel’s patents.
“We’d be very interested in mining the whole portfolio and taking a look at individual pieces of it,” Mosaid CEO John Lindgren told Canadian Press, adding he hopes Nortel doesn’t sell all of its patents to a single bidder.
Not surprisingly, Mosaid is interested in Nortel’s LTE patents but it’s also exploring the idea of purchasing other patents that may not attract a lot of attention.
For creditors, the big question is who much Nortel’s patents are worth. In June, JP.MorganChase analyst Ehud Gelblum suggested Nortel’s LTE patents could be worth $950-million to $2.9 billion. (More detaisl can be found at LightReading.)
More: As of Dec. 31, 2007, Nortel had about 3,650 U.S. patents and 1,650 patents in other countries.
Shortly after selling their 3G/UMTS to Alcatel (now Alcatel /Lucent) for around $300M and the 3G that sold then still sells today (like GSM in favor of their aging CDMA), and like the fox jumping after the unattainable grapes fable, Nortel claimed they would bypass/”leapfrog” 3G to go directly to future 4G /LTE, neglecting the 3G customers to transition into this future technology making no money yet. This was amid their now departed and highly hyped WiMax aspirations after so many failed aspirations already, like Neptune, PEC, Putian, name it… What earned a red cent?
I beg the question, given the development time on this future Long Term Evolution (LTE), just how much value could these patents possibly command.
I don't know about their other patents with exponentially greater development energies in R&D but LTE strikes me as too short a period for anything significant to have gone into this to be worth anything substantial.
Many credible and highly respected sources, everyone actually, is claiming there is value in these LTE patents but I just do not see it. Too short of a development cycle in what was to be sold tomorrow. I figure RIM wants the uniqueness to build around in exclusivity and is thus of no greater value to anyone else besides the associated tax credits.
As far as the remaining patents, wouldn't the overwhelming majority of them be so outdated and pose no use to anyone in this rapidly evolving and merging sector?
I guess the development dollars that went into LTE might be worth something to anyone wanting to use them exclusively but they are not the only ones working on this technology which also begs the question what is Ericsson doing with the LTE they have only licensed and how does this effect them or the possibly new buyer of these patents.
protosphere
It was not that RIM was not allowed to bid but under new terms, they were not allowed to bid on other assets for a further year, assets they sought (the patents). Nortel pulled a fast one on them by folding that changed everything while downplaying they would actually fold, when it suited them it seems.
I would tantrum too if I already signed several non-disclosures already and came as near as formalizing a deal to be announced the next day as they downplayed bankruptcy only to fold and wipe out these past negotiations.
RIM didn't have a legal leg to stand on since bankruptcy changed everything for them so they attacked an exponentially more lame argument in my view than a breach of contract or near contract in that this was of national interest.
As lame an argument as both Dunn and Nortel trying to dismiss what became one of the largest fraud lawsuits in the world on “jurisdictional grounds”. They really must fine tune laws to reflect their intent than have an army of loophole artists with hundreds of millions in resources rewrite the orgin of the holy grail if need be.
To deflect off topic for a bit, Money talks, like the OJ of anti-trust that didn't get away with in in Europe any more than Nortel fared in France with severances. We should learn from European laws than powerful crusader interests on steroids who burned witches around a hundred years ago in a legal system like our Keynesian economic model that works less than it does and excused on being the best we have, like out parliamentary system perhaps, or facilitating acquisition through avoidance (discipline) dare we fire all the teachers in place of better learning through audio visual and apetitive stimuli =) Perhistoric times I tell ya. From laws to education. ahem… anyways…
There should be better laws to protects potential contracts through bankruptcy to save potential buyers energies as well as protecting severances /pensions. I do not think Nortel acted in good faith here and they should not have been as surprised at RIMs response as they displayed than their changing the rules after so much negotiations and a dollar value by far greater than the existing stalking horse, albeit less these sought after patents. =)
The_Deuce
most of the patents are worthless.. have fun!
GoProto
Anyone dealing with Nortel Insiders must approach everything as though they are bargaining with The Devil.. with a slithering snake who can and will do anything to swallow its prey whole. This culture is what RIM ran head long into. i.e., I believe Avaya knew this and was thorough in it's due diligence before entering into their agreement. That's why some complain that Avaya had an unfair advantage- a chance to do everything and anything to close the deal, But, don't blame them, be impressed that they read these zero integrity frauding keystone cops dead on. I hope RIM learned their lesson and will approach any potential dealings with Nortel with eyes wide open and extreme care.
horace_grimswold
The sooner Nortel can be buried, the better.
Slow news day.
random123
I can't answer the question of value, just point to further reading, if anyone is interested.
85 patents. But be careful, some of them may bemis-hits (not Nortel in 'Assignee'). Most filed in 2006/7. I didn't check if all were granted.
Whilst it would be great to know which of these patents are most valuable, the answer would be different depending on your viewpoint (antenna developers will find most value in the antenna patens, etc). Also, that information in itself is highly valuable, so no vendor will disclose it.
We need WIMAX individuals to scan through and pick out the juiciest ones for us
random123
I can't answer the question of value, just point to further reading, if anyone is interested.
85 patents. But be careful, some of them are miss-hits (not Nortel in 'Assignee'). Most filed in 2006/7. I didn't check if all were granted.
Whilst it would be great to know which of these patents are most valuable, the answer would be different depending on your viewpoint (antenna developers will find most value in the antenna patents etc.). Also, that information in itself is highly valuable, so no vendor will disclose it.
We need WIMAX individuals to scan through and pick out the juiciest ones for us
The Battle for Nortel’s Patents Heating Up
To date, Nortel’s asset sales (aka “The Nortel Garage Sale”) have been interesting but not terribly exciting unless you take into account the public temper tantrums that Research in Motion had after it wasn’t allowed to participate in the auction for Nortel’s CDMA wireless business and LTE R&D unit.
But it looks like things could get really interesting as the remaining parts of the Nortel’s empire go on the block. In particular, Nortel’s patent portfolio is likely going to attract a huge amount of attention and multiple bidders looking to buy parts or all of Nortel’s 5,00o or so patents, including the highly sought after LTE patents.
A case in point is Ottawa-based Mosaid Technologies. which has publicly expressed its interest in Nortel’s patents.
“We’d be very interested in mining the whole portfolio and taking a look at individual pieces of it,” Mosaid CEO John Lindgren told Canadian Press, adding he hopes Nortel doesn’t sell all of its patents to a single bidder.
Not surprisingly, Mosaid is interested in Nortel’s LTE patents but it’s also exploring the idea of purchasing other patents that may not attract a lot of attention.
For creditors, the big question is who much Nortel’s patents are worth. In June, JP.MorganChase analyst Ehud Gelblum suggested Nortel’s LTE patents could be worth $950-million to $2.9 billion. (More detaisl can be found at LightReading.)
More: As of Dec. 31, 2007, Nortel had about 3,650 U.S. patents and 1,650 patents in other countries.