In the land of mobile, patents have never been more crucial. He with the most patents has the most power. Period. In the last few months alone we’ve seen Apple and Samsung duke it out, Apple and HTC take it to the mat, Google chat it up with InterDigital, and I won’t even start on Nortel.
Billionaire investor Carl Icahn — notorious for pumping money into companies and then bossing them around — has taken quite the interest in Motorola Mobility’s patent portfolio. With over 17,000 wireless-related patents and 7,500 pending, Motorola has quite the little treasure in its chest, and Icahn wants the company to leverage it in the best way possible.
According to a stock market filing, Icahn held meetings with Motorola asking (or perhaps telling) the company to “explore alternatives regarding its patent portfolio to enhance shareholder value.” Motorola’s portfolio puts Nortel’s $4.5 billion patent trove to to shame in terms of size, and also includes many valuable patents concerning 4G technology. The company would stand to gain billions off of a sale, although the consequences of such action may be more costly than profitable.
With patents you have two choices: 1) Sell big, and get rich quick or 2) Use ‘em. License ‘em. And see a steady cash flow. In just about every case, holding on to your portfolio and either licensing patents or bringing lawsuits against violating competitors is the best bet. In fact, the only reason Nortel sold in the first place was because in the long term, bankruptcy would keep the company from having to ever pay licensing fees.
After meetings with Icahn, Motorola never actually took a sale off the table. However, the company did mention that the 22 percent increase in revenue had a lot to do with Motorola’s beefy patent collection.