By Kat Asharya | Mon Mar 12, 2012 12:39 pm
The Justice Department approved the $4.5 billion purchase of over 4,000 Nortel patents to major Android rivals like Apple and RIM, guaranteeing no end in sight to the legal battles entangling the mobile industry.In Brief boils down complex events to give you the heart of the matter -- today and what it means for tomorrow -- clearly and simply.
What's Happening: The DoJ's review of the record-setting patent purchase of 4,000 patents, previously owned by the now-bankrupt Nortel Networks, expired without comment by the regulator. Rockstar Consortium, a partnership between Apple, Microsoft, Sony, Ericsson and RIM that won the portfolio at auction, is now free to use its purchases.
The Nortel intellectual properties -- covering technologies in wireless, wireless 4G, data networking, among other technologies -- went up for sale last year as a prized commodity in an industry increasingly embroiled in a web of patent litigation. The DoJ's official go-ahead clears the way for the Rockstar Consortium to use the patents freely.
What's Really Happening: The Nortel patents were purchased by an unusual partnership between Apple, RIM, Microsoft and Sony. These partners are generally rivals in the marketplace, but most are all Android rivals, now armed with a warchest of intellectual property.
What's Next: The DoJ's green light will likely lead the way to a new rash of lawsuits targeting Google's mobile OS, continuing a growing wave of patent litigation against Google and its Android phone maker rivals. The Nortel IP covers some key areas in technology, particularly in wireless 4G.
With the DoJ approval, Apple et al. could begin implement many of the Nortel patents in new features and software, but will likely also begin filing more infringement suits against Android phone makers, to either force sales bans or open up negotiations for settlements and licensing. The rash of patent lawsuits against Android is poised to escalate, and the Android rivals could become even more aggressive in their legal strategy to hobble Google.
However, Google has boosted its patent game, acquiring Motorola Mobility earlier this year and giving the search giant its own strong portfolio of patents. Google can likely draw on its own patents to create software and Android capabilities free of patent infringement, or begin to file its own suits against rivals.
The Takeaway: In an industry where the competition between device makers is fought in courtrooms as well as the market, the DoJ's approval of Rockstar's purchase officially arms a group of Android rivals with a formidable weapon. Most of the patent battles have led to few definitive victories, but even one settlement can have lasting, concrete consequences -- Microsoft, for instance, collects a sizable portion of profits on HTC Android phones for its use of its patents. The Nortel patents, especially those covering key technologies like 4G, may lead to more of these licensing settlements in the future.
At this juncture, the focus on patent suits is beginning to shift from outright infringement accusations to questions over fair use of industry standards software. By covering key pieces of technology crucial to the mobile industry, the Nortel patents may get caught up in this debate. However Apple and company chooses to wield their patents, one thing is clear: the importance of patents in the mobile industry will continue to grow, and those armed with the strongest portfolios will likely wield the most influence as the patent battles evolve.
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Editorials & Opinion By Kat Asharya
The Justice Department approved the $4.5 billion purchase of over 4,000 Nortel patents to major Android rivals like Apple and RIM, guaranteeing no end in sight to the legal battles entangling the mobile industry. 
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