Rockstar Consortium, which is jointly held by Apple, Microsoft, BlackBerry, Sony and Ericsson, has agreed to sell thousands of patents to a patent clearinghouse that helps companies protect themselves from patent litigation.
For $900 million, San Francisco-based RPX obtained more than 4,000 smartphone patents from Rockstar, which originally purchased some 6,000 patents from the bankrupt Nortel Networks in 2011. The other 2,000 patents which is not part of the deal are believed to be the most valuable of the collection and have been distributed among the five members, with some 1,000 patents obtained by Apple and the rest divided among the four companies.
However, Rockstar still claims the deal will be beneficial to the maturing smartphone industry as companies veer off from the practice of filing patent lawsuits in a quest to stymie one another's efforts at bringing the latest technology to their products.
RPX, which syndicates a broad range of patents for software manufacturers, OEMs, semiconductor makers and wireless networks, will make the 4,000 patents available to a group of technology companies, which include Google and Cisco Systems.
"Today's announcement is good news for our industry as it demonstrates our patent system working to promote innovation," says Microsoft deputy general counsel Erich Andersen. "We joined Rockstar to ensure that both Microsoft and our industry would have broad access to the Nortel patent portfolio, and we're pleased to have accomplished that goal through this sale and our valuable license to the patents being sold."
Apple and the four companies originally obtained the 6,000 patents from Nortel for $4.5 billion, five times greater than the price it has sold the patents and topping the $900 million bid from Google at the time. The United States Justice Department had initially contested Rockstar's bid for Nortel's 6,000 patents, but had given the green light when Apple and Microsoft, the two most powerful members of the consortium, agreed to license the patents on "fair, reasonable and non-discriminatory" terms.
Both companies agreed. Rockstar's original goal was to have an efficient way to license the patents to other industry players, but it turned out to be another "patent-assertion entity," or more unflatteringly, another "troll" that was in a bidding war against Google, which had pointed out that Rockstar was simply using its thousands of patents to block Android's growing popularity.
Last month, however, Rockstar settled its differences with Google, although both companies did not disclose details of the agreement. Also as part of the deal with RPX, Rockstar has promised to drop its lawsuits against other telecoms companies, including Samsung, HTC and Huawei.
