What could make frequent sparring partners Apple and Google finally come together? According to Bloomberg News, the move is part of a deal to purchase some 1,100 Kodak patents — offered as part of Kodak's bankruptcy liquidation, announced last year. The patents involve the capture, manipulation and sharing of digital images and the offer for the portfolio is estimated at $500 million.
Having been highly competitive in the past in technology markets and patent purchasing, Apple and Google had even separately eyed buying the Kodak patents as leaders of various purchasing groups. With this rumoured partnership, it seems the two companies have realized sharing the bid for the Kodak patents is better business than duking it out separately.
The driving factor behind the decision is, of course, money. It prevents an expensive bidding war if the two camps were pitted against each other. Plus, should the two giants come together it negates potentially costly litigation in patent infringment cases that could ensue if they and any member of their groups remained competitors.
Could this be the sign of a changing patent environment?
The Bloomberg report points to Apple having teamed with Microsoft and Intellectual Ventures Management and Google's team involving patent aggregators RPX Corp. and "Asian makers of Google's Android phone" (likely Samsung); that means a lot of feisty players would effectively have no grounds for patent litigation should the two groups indeed come together.
Analysts suggest rumors of this unusual (up-until-now) union of the separate Apple and Google led purchasing consortiums may have been the result of earlier patent wars where each company strove to outbid each other and ending up driving prices sky-high in the process.
Ironically, Kodak has estimated the patents to be worth $2.21 billion to $2.57 billion, but now is worth significantly less due to earlier licensing agreements the company was forced to make to generate revenue.
Apple and Google have four months to produce the purported $500 million bid. It is amount that will secure a commitment for $830 million in exit financing the 132 year-old Eastman Kodak Company is hoping will fund a turnaround from their current Chapter 11 status in 2013 and help them move into the more commercial, packaging and functional printing enterprise services.
According to the Bloomberg report, none of the companies have commented on the rumored deal.