InterDigital Inc (IDCC)

[M6]

Intel Acquires More Patents

http://www.iam-magazine.com/blog/Detail.aspx?g=e93ca242-0259-428b-a248-0b1c5b709799

Intel acquires more patents to boost its smartphone strategy

We’ve known for several yeas that Intel’s focus on the secondary patent market is to bolster its patent portfolio in the mobile space as the company struggles to establish a foothold in the smartphone sector. In 2011 the chipmaker lost out to the Rockstar consortium in the bidding for the Nortel portfolio. It followed that setback soon afterwards, though, with the 2012 acquisition of a large portfolio from InterDigital for $375 million and last week it was announced that the company has added a further 1,400 patents from Powerwave. The latest acquisition, which it is purchasing from an affiliate of the Gores Group which bought the patents from Powerwave in Chapter 11 bankruptcy proceedings, involves telecommunications infrastructure technology.

Commenting on the deal, an Intel spokesperson told the IAM blog: “The transaction is part of our ongoing process to improve our overall patent portfolio. We’re not disclosing the price of the transaction; however, the amount is not material to Intel. We believed these patents were high quality and a good fit for our portfolio.”

If they are of the quality claimed and given that they were acquired out of bankruptcy proceedings from Gores, an asset management company, the likelihood is that Intel was not alone in at least taking a look at the portfolio – the patents would surely have been of interest to a number of parties, NPEs among them. On that basis we might assume that although the price is not material to Intel it is still a significant amount and that some kind of bidding process may have been followed. Though, of course, this can only be speculation.

On the wider business front, the challenge for Intel is that so far an aggressive push into the smartphone sector has not been paying off. In the company’s results for the second quarter of this year, revenues for its mobile and communications group dropped 67% compared with the first quarter and down 83% compared with Q2 2013.

The true test for Intel’s smartphone strategy looks like it’s going to come at the end of this year when the company releases a new chip with integrated 3G and then an LTE version in 2015. It seems increasingly that by next year we’ll be able to tell if Intel’s forays into the secondary patent market have been worthwhile.