It’s no secret that Motorola has been struggling for market share and relevancy ever since it stopped riding the wave of the Razr success, but they may have new wind in their sales (pun intended) with one of their most valuable assets – their patent portfolio.
With the continuing legal battles spearheaded by Apple, manufacturers are grappling for patents to protect their designs and avoid being their next target. Undefined intellectual property rights are encouraging manufacturers to seek patent portfolios. Companies that have many patents, like Motorola, therefore have an advantage at this time and can leverage these as assets. Motorola, with its impressive patent portfolio, can either use these patents to up their own market share, or can choose to sell them to other manufacturers looking to boost their portfolios. Just last month, Apple took advantage of a patent deal that significantly strengthened its portfolio by purchasing, along with Microsoft, RIM, Sony, EMC and Ericsson, the Nortel patents for over $4.5 billion at auction.
While Google claims that the patent system is broken, that doesn’t mean they aren’t interested in biting of a piece of it, and they have found an interesting ally in Motorola due to the sheer volume of patent rights they have accumulated during their long history in the communications industry. Google and Apple, the relative newbies, will begin to define their presence in the mobile communications world less by their own innovation, and more through the company they keep. Google may have a head start, however, considering that Apple’s deal with Nortel is currently under review with the Justice department. Motorola, on the other hand, is well positioned to battle it out since it has far more relevant patents than any of its competitors. Ehud Gelblum, an analyst for Morgan Stanley commented that, “It is interesting to note that Motorola asserted 18 patents against Apple, and sued Apply first, whereas Apple has asserted just six patents against Motorola”. So although Apple started the battle, it may be defeated by Google and its allies, especially with the 17,000 patent-rich Motorola on their side.