Rivals Band Together Against Google to Buy Patents

Nortel offloads 6,000 patents for $4.5 billion

Big names like Apple, Microsoft, and Research in Motion put rivalries aside in order to win a bid for 6,000 Nortel patents up for auction. A consortium of six companies, also including EMC, Ericsson, and Sony, shelled out $4.5 billion for the bundle of mobile patents, representing a landmark auction for Nortel.

The winning bid technically went to an unknown company, Rockstar Bidco LP, which had lawyers scratching their heads trying to figure out who the newcomer was. As it turns out, the pseudonym was a tactic by the powerhouse consortium to shield their interest in the block of patents. The Department of Justice gave clearance to the group to bid on the patents without revealing their identity.

With the six companies enjoying their spoils and bankrupt Nortel happy for the massive injection of cash, it looks as if the only real loser is Google. The company, under its subsidiary Ranger Inc., was expected to win the patents, hoping to use the technology as a defense in a slew of patent suits relating to Android technologies.

The inner workings of the arrangement among members of the six-company consortium are not yet clear. The companies will either share all of the patents among them or will parcel out the bundle and retain rights to specific patents individually. Research in Motion and Ericsson said in statements that they contributed $770 million and $340 million respectively to the bid. The other companies’ contributions are not yet known.