Google Out-Maneuvered in a Bid for Nortel’s Wireless Patents

With Nortel putting 6000 patents and patent applications up for sale as part of their liquidation, companies were gathering round and salivating for the chance to get their hands on them. Google’s opening bid of $900 million dollars seemed like a reasonable shot at taking home the prize –until Apple pulled together a team of wallets to outbid them.

This team, consisting of Apple, RIM, Microsoft, Sony, Ericsson and EMC agreed to pay a cumulative $4.5 billion dollars, a full half billion above what Google’s top offer could have been. Looking at the cast of characters, it certainly does appear like the professional equivalent of ‘us against them’ with the competition all taking aim against Android. Their official public relations argument is that this consortium puts the patents in the hands of the companies best able to utilize them for the good of the industry.

There is no doubt that this acquisition will be good for all six of the proud new owners. With fewer royalties to pay and head-starts toward emerging technologies contained within the patents, each company stands to benefit. They also stand to profit: from Google, who will quite likely feel the sting of increased licensing fees as a result.

Google wasn’t the only big name to lose in the bidding war, chip-giant Intel was also rumored to have been a contender in an effort to become more competitive in the wireless market.

Of course the deal is still subject to approval and assumes all regulatory obstacles can be thwarted, but expectations (especially those of Nortel’s creditors) are high. Nortel was the largest communications company in the world over a decade ago, before accounting scandals and mismanagement rumors brought them to bankruptcy by January of 2009.

[via Reuters]

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