Opportunities still exist to monetize patents for those willing to do their homework and adjust expectations, veteran patent licensing executive Bob Bramson, a WiLAN director, told IP CloseUp in an exclusive interview.
There is a common theme running through Rockstar’s recent $188M settlement with Cisco, its litigation against Asian handset makers, including Samsung, and sale of 4,000 patents to a group led by RPX for $900M: Patent holders with solid patents and realistic expectations can still find success.
Despite impediments like IPRs, software-adverse decisions like CLS Bank v. Alice, and aggressive anti-NPE lobbying, significant patent agreements are stilling being transacted. The key to their success, says Bramson, who is responsible for more than 1,000 patent licenses and sales over a 40 year career, is quality and need.
“Licensing is about money,” says the patent attorney and strategist who was recorded in our offices in late December. “Surely, the sugar-plum visions of a few years ago need to be rethought, but that does not mean there aren’t good opportunities out there for those willing to conduct the necessary due diligence. Patent monetization is about risk and reward, and if after careful analysis the potential damages are still there, then you at least have the basis of discussion. The last thing a patent monetizer wants to do is win the battle but lose the war.
“Rumor has it that the Rockstar deal got done because of pressures exerted by some of their investors, notably Apple and Microsoft. There is a complex network of relationships and needs that fuel agreements between big parties, and direct revenue is frequently only a part of it.”
Patent Value in Perspective
While it’s difficult to calculate the precise current value of Rockstar (the company) based on its December 23rd patent sale to RPX, it is safe to say that it is a quarter to a half of the $4.5B that it’s investors, Apple, Microsoft, Sony, Ericsson, EMC and
Blackberry, paid in 2011. That said, $1B to $2B value on a single patent portfolio in the current anti-enforcement environment is nothing to sneeze at.
These investors also had complex needs and unique resources, the most important of which appeared to be keeping the patents out of Google’s hands. In Apple and Microsoft’s case, they also had huge amounts of cash on their balance sheet to deploy.
“I expect that there will be a clearing out of patent monetization businesses in the next couple of years,” continues Bramson, who founded and served as CEO of InterDigital Technology Corp. “But that’s not to say there aren’t still opportunities out there. Smartphones are one of many industries that rely on patents to compete. Sectors like medical technology and smart cars are heating up, and 3-D printing is likely to be huge.”
Watch the interview with Bob Bramson by clicking here.
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