Opinion

What does Apple want with Nortel's patents?

With Nortel's cupboard now bare following the sale of a small Chinese networking JV to Ericsson, attention is turning to the vendor's last remaining asset, its extensive patent portfolio.

Nortel had a long and venerable history and has amassed a portfolio of over 4,000 patents, which it is thought could be valued at up to a billion dollars.

Final bids for the extensive line-up are thought to be due soon, and although the usual networking industry suspects have almost certainly been sidling up to the trestle table with their wallets out, interest has apparently emerged in the IP relating to mobility and LTE from none other than Apple.

This is according to news agency Reuters, which cited the mysterious and knowledgeable Source Close-To-Nortel.

So what does Apple want with Nortel's IP?

Well, as neatly explained in this handy chart, the mobile industry is a minefield of litigation and counter-litigation, with Apple facing down lawsuits from firms such as Kodak, Motorola and Nokia.

And Apple is no slouch itself, and has been dealing them out willy-nilly.

The accusations centre on various items of IP relating to the fast-growing smartphone market.

So it seems likely that what Apple is actually doing - should it come to pass that it makes a successful bid - is covering its own arse.

By building up a patent library of mobility IP - even if Apple never developed any of the technology itself - Steve Jobs gets both ammo to take his rivals for a hefty cash settlement should they step on his toes, and bargaining chips to ensure that negotiations over cross-licensing deals run smoothly.

This was first published in December 2010

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