This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Google Headed for Patent Showdown

NEW YORK ( TheStreet) -- Google (GOOG - Get Report) has gained some mighty enemies.

The unlikely consortium of Apple (AAPL - Get Report), Research In Motion (RIMM), EMC (EMC), Ericsson (ERIC), Sony (SNE) and Microsoft (MSFT - Get Report) that paid $4.5 billion for Nortel's patent portfolio is perhaps the clearest sign yet that the tech sector is dividing into two camps.

"The battle lines are drawn, and it's basically the world against Google," said Recon Analytics' Roger Entner.

Google's loss in the Nortel auction puts about 6,000 patents in networking and wireless technology into the hands of its rivals.

The move comes as patent wars heat up in the mobile industry, which is enjoying enormous growth in segments like smartphones, application development and location-based advertising.

Not only does the loss put Google at a disadvantage in patent cases, it also threatens to raise the cost of Android operating system, which could slow the rapid expansion of Google's mobile software.

Google, which helped launch the auction when it originally offered Nortel $900 million for the patents, was a little bitter about seeing the assets fall into enemy hands.

"This outcome is disappointing for anyone who believes that open innovation benefits users and promotes creativity and competition," Google told Bloomberg Friday.

The setback is one of many lately for Google.

Oracle (ORCL), for example, said this week that it is looking for $2.6 billion from Google for use of the Java codes in Android as part of a patent dispute that started last summer.

And last week, arch enemies Nokia (NOK) and Apple came to a sudden agreement over wireless phone technologies. The swift resolve had all the markings of some behind-the-scenes brokering by Microsoft in order to assure a smooth launch of the Nokia Windows 7 phones later this year.

The alignments are largely a response to how successful Google has been in mobile thanks to its popular, low-cost Android operating system.

"Right now," said Entner, "Android is the one to beat."

And judging by the consorting of its enemies, the beatings will start soon.

Google shares were rising 1.74% to $515.18 in late-morning trading Friday.

--Written by Scott Moritz in New York.



>To contact this writer, click here: Scott Moritz, or email: scott.moritz@thestreet.com.

To follow Scott on Twitter, go to http://twitter.com/TheStreet_Tech.

>To send a tip, email: tips@thestreet.com.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $128.70 0.00%
GOOG $540.78 0.00%
MSFT $48.24 0.00%
FB $78.81 0.00%
TSLA $230.51 0.00%

Markets

DOW 18,070.40 +46.34 0.26%
S&P 500 2,114.49 +6.20 0.29%
NASDAQ 5,016.9290 +11.5380 0.23%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs