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By James Lee Phillips | June 6, 2011 6:58 PM GMT
In the tech world, the big potential anti-trust debate may still be AT&T's acquisition of T-Mobile. However, the U. S. Department of Justice is currently looking at Apple and Google as well.
Not that there is any possibility of a merger between the two perennial rivals, but both have put in bids for patents being sold by Nortel Networks Corporation. A Wall Street Journal article on Friday states that "people familiar with the matter" are indicating that the Department of Justice has reason to believe that the patents could tip the scales of competition too far in one company's favor.
Nortel's portfolio of patents stretches back for over a century, including (as the company website states) "Alexander Graham Bell's original telephone patents" when the company was still known as Northern Electric and Manufacturing. Apple and Google are far more likely to be interested in the company's later wealth of Internet-era patents, including numerous wireless, wireless 3G and 4G, and data networking patents.
However, the first decade of the 21st Century saw Nortel struggling to recover from numerous unprofitable acquisitions during the 1990's Internet bubble, as well as a 2007 SEC case against three former top execs over accounting shenanigans. The Canadian telecommunications giant that once boasted a third of all trade on the Toronto Stock Exchange filed for bankruptcy in January of 2009, and it was clear to many that liquidation was more likely than restructuring.
In April, Nortel announced that it had made a "stalking horse agreement" (i.e., a bankruptcy-related pre-auction bid) with Google for $900 million in exchange for some 6000 patents and patent applications. "This is an unprecedented opportunity to acquire one of the most extensive and compelling patent portfolios to ever come on the market", said George Riedel, Nortel's Chief Strategy Officer and President of Business Units.
However, Apple seems to be of particular interest to the Department of Justice, who considers the company to be especially active recently in pursuing cases involving "intellectual property rights against other companies," according to The Journal's report. Apple has filed lawsuits against even its own partners, such as Samsung, as well as major Google supplier HTC.
James Lee Phillips is a Senior Writer & Research Analyst for IBG.com. With offices in Dallas, Las Vegas, and New York, & London, IBG is quickly becoming the leading expert in Internet Marketing, Local Search, SEO, Website Development and Reputation Management. More information can be found at www.ibg.com.
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