Bloomberg News: One Company’s Trash Is Another’s Treasure in Patent World
Squeezed out of the mobile-phone market by trendier offerings, Nokia Oyj (NOK1V), Ericsson AB (ERICB) and other one-time leaders are selling chunks of their patent portfolios, often to the litigious licensing firms the industry has derided.
The companies are being driven by their need for greater profit, and are finding that with changing business models, tough economics and investor pressure, there is little reason to hold on to patents for computer memory, wireless infrastructure and other technology that can still fetch a good price.
“There’s a frenzy to try to monetize” these patent portfolios, said Nick Rodelli, a senior analyst at CFRA, a New York-based-based forensic accounting and legal research firm.
Ericsson, Panasonic Corp. and Hewlett-Packard Co. sold almost 5,000 patents in the first quarter combined, according to Innography Inc., an Austin, Texas-based maker of software to analyze patent portfolios. Nokia on July 7 said it had sold a group of phone patents to licensing company Wi-Lan Inc.
Picking up the pieces are licensing firms whose sole mission is to buy castoff patents and then demand royalties from other companies in a strategy to make a profit.
“There’s a whole industry of buying and selling patents,” said Innography Chief Executive Officer John Martin