Rockstar Bidco (Apple, Sony, Ericson, Blackberry and Microsoft) were determent to outbid (bid: $4.5 Billion) Google in 2011 for thousands of high quality patents from Nortel. Nortel is a Canadian (Ottawa) based telecom company that owned these thousands of patents related to personal computers, modems, wireless technology, fiber optics, social networking and internet search, but unfortunately went bankrupt in 2009. In what appeared to be an international bankruptcy scandal, this left about 30,000 people without a job, many left without a pension and/or life insurance coverage.
Google of course had their eyes on those patents (this one is just an example) and they thought they could get them on the “cheap” side ($900 Million) but things went a little different for the search giant, as the Rockstar Consortium stepped in to protect their market and bid against Google. Google was already very successful in the mobile market with Android, and the Rockstar Consortium was content to outbid Google to keep certain LTE and 4G wireless portfolio patents from Nortel out of Google’s hands.
(Reuters published a good article after the bidding war)
“It did become clear to us very quickly that this was something that a bunch of big companies with humongous balance sheets had decided was strategic for them,” RPX Chief Executive John Amster said. “Clearly at a price at this level it had to be strategic, and they could afford that.“
(Joe Mullin from Arstechnica notes in an article from October 31 2013)
“Patent insiders knew that the Nortel portfolio was the patent equivalent of a nuclear stockpile: dangerous in the wrong hands, and a bit scary even if held by a ‘responsible’ party.
This afternoon, that stockpile was finally used for what pretty much everyone suspected it would be used for—launching an all-out patent attack on Google and Android. The smartphone patent wars have been underway for a few years now, and the eight lawsuits filed in federal court today by Rockstar Consortium mean that the conflict just hit DEFCON 1.”
One might believe this now called Rockstar (Bidco) Consortium did not want Google to get even stronger and they stopped them when they had to.
Rockstar Concertium was created as a new company soon after the purchase of Nortel’s patents was completed to make sure the original owners (Apple, Microsoft, etc.) could not be counterattacked, sort of the same structure as Nokia has now and is therefore much more capable of milking their ([massive]<– clicking the link is worth your long read btw) IP portfolio after they sold their mobile/handset business to Microsoft.
In October 2013, Rockstar Consortium filed a suit against Google, ASUSTek, HTC, Huawei, Pantech, LG, and ZTE for infringing patents and this week the United States Magistrate Judge decided in favor of Rockstar. However, it is not clear if companies other than Google are affected by this decision. Cisco, a company not linked to the before mentioned lawsuit, agreed to pay $188 Million a few days ago. It might be obvious Rockstar wants to make money and Google is their next target, for now.
Google has received some blows in the past few years as well as retaliation from competitors due to the search giant taking the free software route.
- Apple just recently replaced their search engine from Google to Bing, in their new Yosemite OS. In addition, Siri also uses Bing and has been since the beginning.
- Google Glass has completely failed to take off and is considered a flop by many.
- Microsoft is also unleashing a heavy assault on Google docs with Office 365, and just recently making their Office apps free on mobile all platforms with the ability to edit and create documents, while at the same time offering OneDrive as a feature with unlimited storage to all Office 365 subscribers. Microsoft also has a free version of Office on the web to further take away any reason to use Google Docs.
- Microsoft recently launched an all out attack on the Chromebook with the offering of a free Windows licence to OEM’s selling devices for less than $250. This has caused the recent flooding of the market with low-end Windows devices such as tablets, phones and PC’s. We are curious on how this will affect Google and Microsoft in the next few months.
- Mozilla (Firefox) also chose Yahoo instead of Google recently as their browsers default search engine (Yahoo uses search via Bing btw).
- The court ruling recently and fresh from the press the news announced by Reuters that the European Parliament is going to propose a search services split in threat to Google is definitely an interesting turn of events, and can pose a serious problem for Google.
We will keep you posted on the recent court ruling, but judging by all of the above circumstances it seems like Google is not so well liked. We have yet to see the effects of all of the above mentioned and it will certainly be an interesting time to follow Google and the surrounding controversy it has with the E.U.