Google bids $900M US for Nortel patents

Search giant Google Inc. has been selected to make the first bid for the entire portfolio of patents held by Nortel Networks Corp., administrators for the bankrupt Canadian high tech company said Monday.

Google has bid $900 million US to buy about 6,000 patents in what's called a stalking horse bid.

That sets the lower limit in an auction scheduled for June, avoiding bids that are unrealistically low. Other potential buyers will be free to make competing offers.

Nortel was by far Canada's biggest technology company and one of the world's leading developers of telecom technology until it collapsed.

The patent portfolio is practically the last of Nortel's assets to be sold.

"The whole process has been a bit sad," Duncan Stewart, director of research for technology at Deloitte, told CBC News.

"Anybody who'd ever been up to Ottawa and seen the Nortel R&D centre and seen all the incredible Canadians working at pushing back the boundaries of knowledge, it was an amazing place to be, especially in the 90s and yes, this is not only sad, because it's the last bit of Nortel, but to many Canadians I think it was the most important bit of Nortel."

At the same time, he said, many of the Canadians who developed those patented technologies remain in the country, "so even though they're not doing it under the Nortel umbrella anymore, they're still here and they're still, hopefully, innovating in Canada."

Patents cover broad swath of telecom market

The patents cover a broad range of wired, wireless and digital communication technologies.

"The extensive patent portfolio touches nearly every aspect of telecommunications and additional markets as well, including internet search and social networking,"Nortel said in a release.

Other possible bidders include Waterloo, Ont.-basedResearch In Motion, the maker of the BlackBerry,as well as IBM and chipmaker Intel.

Mountain View, Calif.-based Google has been making a push into the wireless market with its Android operating system.

Stewartexpected the patents would fetch as much as $1.4 billion.

"Most people [in the industry] had thought that the Nortel assets would be worth at least a billion dollars," Stewart said.

Given the size of the first bid and how previous Nortel asset auctions have gone, he added, "usually the amount they end up going for ends up being 200 and 400 million dollars more."