Microsoft entered into a deal with Nokia this month to purchase almost all of Nokia's Devices & Services business, license Nokia's patents, and license and use Nokia's mapping services, according to a Microsoft press release. The way the deal is structured has raised some eyebrows, since the IP isn't being sold along with the rest of the business. Alexander Poltorak talked to the Financial Times (FT.com) about why this kind of transaction makes good financial sense for Nokia. ("Nokia patents bump up cost for Microsoft" Financial Times - September 4, 2013) (Registration required)
Article excerpt: The two-part structuring of the transaction is unusual for this type of deal, according to patent experts. Acquisitions such as the purchase of Nokia’s handset business usually include the automatic transfer or licensing of related intellectual property – otherwise, the new owner would have no rights to the products, explains Alexander Poltorak, chief executive of General Patent Corporation, an intellectual property advisory firm.
...“Nokia has been a very savvy IP player,” says Mr. Poltorak. In one sign of this, it sold a group of patents to Mosaid Technologies, a Canadian patent licensing company that has been attacked in some quarters as one of the so-called “trolls” that have held big tech companies to ransom with legal threats.
Nokia may also be able to extract more value from its patents than Microsoft would have been able to do.
The US company has already sold licences to a number of hardware makers that use Google’s Android software, and taking on the Nokia patents as well would not enable it make any more money from those agreements, points out Mr. Poltorak. By keeping the patents, Nokia has retained the right to go after the same hardware makers itself, bringing an extra payday, he argues.
Read full article at FT.com (registration required)