After several months, still no deal reached in the Nortel patent auction, which reported a flurry of activity back in September of last year. This comes despite the fact that the portfolio was reportedly worth $1 Billion. Now bidding has stalled, according to Joff Wild at IAM Magazine, and there might be an auction in March. With interest from industry players like Google and RIM, and aggregators like RPX (bidding on behalf of Apple), how could this sale not have happened?
It’s possible that the value just isn’t there, but more likely the difficulty lies in splitting the portfolio up. As Joff points out, “[s]plitting it up into tranches gives you a better chance of maximising your return.” This is no small task, but just as you might make more out of selling a vintage comic collection one piece at a time, than if you sold the whole bundle to a second-hand store, Nortel creditors may have to wait (even longer) to see their return under this model.
Granted, they won’t have to wait as long (and won’t realize as much value) as they would if they were to just hire a monetization advisor to help monetize the portfolio directly. This process also takes time, but if the “billion dollar” value placed on the Nortel patents reflects the aggregate amount one would realize from licensing the portfolio, then no bidder would actually pay anywhere close to a billion dollars. Pawn brokers that buy silver coins for $25 and sell them at the same price don’t stay in business very long.
- Spending Spree In Place Post RPX IPO? (gametimeip.com)
- Is Groupon’s Patent Really Worth More Than The Entire Nortel Portfolio? (gametimeip.com)
- Nortel patent sale delayed despite intense interest (reuters.com)
- Nortel bonds on the rise again (theglobeandmail.com)
- Are We On The Verge Of A Patent Arms Race? (gametimeip.com)