This Day On The Street
Continue to site right-arrow
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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

How AOL's Microsoft Deal Could Boost RIM

Stocks in this article: AOL MSFT RIMM IDCC AAPL

NEW YORK ( TheStreet) - AOL's (AOL) deal to sell Microsoft (MSFT) over $1 billion in patents only intensifies the war for patent portfolios, potentially benefitting companies like Research In Motion (RIMM) and InterDigital (IDCC).

With the patent market hot again, ( Yahoo! (YHOO) recently sued Facebook over patent infringement), AOL's lucrative sale could have a broader impact.

Miller Tabak analyst David Joyce, for example, notes that the Internet patent market is "increasingly strong", as competition for key technologies increases. Joyced upped his price target on AOL to $30, and kept his "buy" rating.

AOL's patents were thought to be worth around $300 million, according to Benchmark analyst Clayton Moran. "We believe most on the Street viewed $300 million as the likely maximum value. Relative to this expectation, AOL has created $7.63 per share in stock value," Moran wrote, in a research note. The analyst rates AOL "hold" and upped his price target to $28 from $18.

The intensifying patent market could therefore be a boon for companies like InterDigital, which tried to sell its patent portfolio throughout 2011 to unlock value. Ultimately, however, InterDigital did not receive the price it wanted for its portfolio, and pulled the sale. The wireless specialist was hoping to receive as much as $3 billion for its patents, according to reports by the New York Times.

Research in Motion, like InterDigital, could also benefit from the intellectual property feeding frenzy. Omega Advisors' Leon Cooperman, for example, purchased a significant stake (1.4 million shares) in Research In Motion, not only because of the company's turnaround potential, but also because of its patents. "There is tremendous intellectual property..." at RIM, Cooperman said.

Here is the rest of Leon Cooperman's portfolio:

Microsoft's acquisition comes after some prominent intellectual property deals. Google (GOOG), for example, purchased Motorola Mobility for its patents. The Google/Motorola Mobility deal came after a consortium of technology companies, including Apple (AAPL), Research In Motion (RIMM) and the aforementioned Microsoft, purchased patents from Nortel for $4.5 billion.

AOL sold 800 patents to Microsoft in exchange for $1.056 billion in cash. Most of the cash will be returned to shareholders, but AOL has not yet said how it will do so.

Shares of AOL are soaring this morning, up 42.62% to $26.37.

Interested in more on AOL? See TheStreet Ratings' report card for this stock.

Check out our new tech blog, Tech Trends. Follow TheStreet Tech on your wireless devices.

-- Written by Chris Ciaccia in New York

>To follow the writer on Twitter, go to

>To submit a news tip, send an email to:

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,601.49 +244.62 1.41%
S&P 500 2,044.96 +32.07 1.59%
NASDAQ 4,718.2260 +73.9140 1.59%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs