updated 02:45 am EDT, Sat July 2, 2011
Apple key to winning Nortel bids
The consortium win in Nortel's auction was headed by Apple against a Google that was at times difficult to take seriously, uncovered details from the inside have shown. The group, nicknamed "Rockstar," led almost from the start and was facing off against just Google by the very end. After already reaching $3 billion, the two sides seen by Reuters' observer bid in $100 million increments up to $4 billion, where Google "tapped out" even after getting special permission to continue past an earlier $3 billion limit.
Ericsson had at one point been trying to bid by itself, but decided to join Apple by Tuesday once the stakes got too high.
Others backed out relatively quickly, the tips hinted. Intel quit on Wednesday, and the Huawei-backed RPX consortium was one of the first to back out after it became clear that the bigger companies were determined to get the patents for vital parts of their business and not just exploring possibilities. It too had been considering a partnership but never found one before the auction was over.
Google's behavior in offering countering bids beyond its original "stalking horse" was odd, sources said. During the auction, it was making unusual bids, based on the distance between the Earth and the Sun and other esoteric conditions that were fun but irrelevant. Its last bid, once values passed $3 billion, was actually $3.14 billion, or Pi. Some have doubted that Google was serious and may have either been having fun or deliberately drawing attention to its bids.
It's still unknown what if any action the consortium will take with the patents, which focus mostly on wireless such as 4G and Wi-Fi. They could at least be used as defense against patent trolls and other competitors. Alternately, they might be used to sue other companies, although the pact coming from a consortium may prevent even Apple, Microsoft, or RIM from suing over a patent without consulting each other.
Apple's lead suggests it more than anyone had the deepest interest in pursuing the patents and may have been hoping to use them as a foil against others with wireless patents, like Nokia, or as further damage against targets like HTC or Samsung.