What RIM Wants: The LTE Patents Ericsson Didn’t Get

Observers continue to puzzle over RIM’s motivation in the ongoing Nortel saga. Why, people ask, has RIM enlisted the Canadian government in a bid to thwart or otherwise complicate Ericsson’s pending acquisition of Nortel’s wireless business unit in a court-sponsored auction?

As I’ve said previously, RIM would like to get its hands on Nortel’s LTE patents. I have no doubt about it.

What’s interesting is that Nortel’s LTE patents were not included in the pending sale of its wireless assets to Ericsson. If that deal goes through, the Swedish telecommunications manufacturer will get CDMA and LTE products and technologies, but it will not gain ownership of Nortel’s LTE patents.

As Nortel lawyer Derrick Tay has said, Nortel isn’t transferring any of its LTE patents under the planned sale of wireless assets to Ericsson. Nortel will license the appropriate LTE patents to Ericsson as part of the planned deal, but Nortel still owns the LTE patents and a sale process relating to those properties has yet to be determined.

Nortel has more than 5,500 patents, of which 600 — mainly relating to CDMA — are being transferred to Ericsson under the proposed deal.

So, Nortel has sold its wireless business unit, but its LTE patents remain potentially in play. Nortel supposedly wants to keep them, recasting itself as a “patent troll,” stocked with more lawyers than engineers. RIM, of course, would like to acquire them, presuming Nortel is willing or forced to put them on the auction block.

I could be wrong, but I think RIM has involved the Canadian government – and invoked a concerted propaganda campaign – to compel Nortel to offer the patents, many of which were devised and developed in Canadian research laboratories, for sale to a Canadian buyer. The argument would be that such valuable intellectual property, at least some of which was financed by Canadian taxpayers, should remain in the country, where the work can continue under the auspices of a real company (RIM) – you know, one with actual engineers — rather than a corporate shell manned by fast-taking lawyers and green-visored accountants.

How will it turn out? Stay tuned.

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