Google bids $900m for Nortel patents

Google's bid is expected to serve as the basis for an auction of some 6,000 patents and applications including in 4G, data networking, optical, voice and semiconductors. The Google offer was chosen after several rounds of preliminary bidding.

 

In a statement, Nortel said the patent portfolio “touches nearly every aspect of telecommunications and additional markets as well, including internet search and social networking.”

 

As part of the agreement, Nortel has agreed to pay Google a $25 million break-up fee and repayment of up to $4 million in expenses if another party ends up winning the auction, according to Bloomberg. Bids will go up in at least $5 million increments, and bidding has been pegged to hit at least $1 billion.

 

Other companies expected to bid for the patent pool are ZTE, Ericsson and patent license provider RPX, Reuters said. Reuters has previously estimated that Nortel owns seven of the 105 patent families likely to prove essential to LTE. Huawei may also be interested. 

 

The auction requires bankruptcy court approval.

 

Nortel's patent portfolio is nearly all that's left of the once mighty Canadian telecom equipment vendor. The company has sold off most of its other assets after declaring bankruptcy. Notable deals include the sale of its GSM and CDMA assets and its controlling stake in LG-Nortel to Ericsson.