January 11, 2013, 7:57 AM — Ericsson has agreed to transfer 1,922 patents and 263 patent applications to Unwired Planet in return for a share in ongoing revenue from the patents.
The transfer includes 753 U.S. patents related to 2G, 3G and LTE technologies, Unwired Planet said Thursday. Four months ago, the company owned just 200 U.S. and foreign patents, and around 75 pending patent applications.
"Our patent portfolio now extends to all layers of the telecom handset and infrastructure stack," said Unwired Planet's CEO Mike Mulica during a conference call. The patents cover application stores, location-based services, mobile search and mobile advertising as well as network protocols, antennas and many more topics, Mulica said.
The portfolio will continue to grow, as Ericsson has also committed to transfer a further 100 patents each year from 2014 through 2018.
Mulica said the company wants everyone who uses the patented technologies to pay a license fee. "We will use litigation when necessary," he said.
Unwired Planet has already turned to the courts to assert its patents. In September, it sued Google, alleging that Google Maps, Adwords, Google Search and the Android operating system, among other technologies, infringed its patents. It also sued Apple that month, alleging infringement by the iPhone, iPad and iPod, Apple's push notification service, iAds and location services used in the Safari Web browser and Apple Maps. Those lawsuits are in the preliminary proceedings phase, Mulica said.
Unwired Planet will share revenue from its patent portfolio with Ericsson. The Swedish network equipment vendor will get a 20 percent cut for the first US$100 million dollar revenue raised and a 50 percent cut for revenue raised between $100 million and $500 million. Ericsson will receive a 70 percent share of revenue over $500 million, Mulica said.
Ericsson will receive no lump sum for the transferred patents, but if Unwired Planet is acquired by another company, Ericsson may elect to receive one instead of sharing revenue. In that case, the payment would be calculated according to the market value of the patents, with Ericsson receiving a minimum of $1.05 billion, less any revenue share it had already received, if Unwired Planet is acquired within three years.
Handset makers will be the priority targets for Unwired Planet's new patent portfolio, the company said.
Unwired Planet would love to obtain thousands of other patents that Ericsson holds, said Tim Robbins, General Manager of Intellectual Property at Unwired Planet, during the conference call. He wouldn't say which were the strongest patents his company had gained. "There are obviously favorites, there is a lot of them, a lot more than a couple," he said.