Jack Ellis

Hon Hai/Foxconn Group chairman and founder Terry Gou suggested earlier this year that his company had been filing too many patents – and the Taiwanese manufacturing giant is now clearly exploring novel ways of generating extra cash from the extensive IP holdings that have resulted from this volume-based approach to procurement. Having previously sold patents to Google in 2013 ansd 2014, Want China Times reports that, earlier this month, the company placed 1,400 IP portfolios covering electronic components technology up for sale on WTOIP, a China-based online IP trading platform that formed a partnership with US counterpart AutoHarvest back in March.

Also, in a first for Foxconn, it will hold an auction of 27 portfolios covering a diverse range of technologies on 19th November. The company’s exclusive monetisation agent MiiCs & Partners has retained the services of veteran patent auctioneers at ICAP in order to handle the event. “It is one of multiple ways in which we are monetising Foxconn’s patent assets,” Roger Tu, senior vice president at MiiCs, told IAM. “We believe this auction should facilitate maximising the value of these patents in the marketplace.”

Among the lots on offer are portfolios relevant to mobile devices and applications, cameras and lenses, LCD projectors and displays, flash memory, audio/video processing and playback, cable modems, batteries and chargers, medical software, navigation, optical systems and connectors, wireless access points, televisions and voice-over-internet-protocol, among others. “We believe these patents are good quality covering different technologies,” said Tu. “We have run an in-depth process to identify them and to decide if they qualified for auction.” Similarly, guidance prices – which you can view on ICAP’s website here – were calculated based on factors including, but not limited to, market reference prices, technology trends and patent quality, he added.

IP auctions have had mixed success in the past. Ocean Tomo – which pioneered the concept of the big-ticket patent auction – held several such events between 2006 and 2009, but exited the business that year by selling its transactions unit to ICAP after a number of disappointments. Most notably, one of the last auctions it held during that period resulted in only six of over 80 lots being sold. ICAP has since abandoned the open, public sale format. Last October, after the expiration of its non-compete agreement with ICAP, Ocean Tomo announced that it was planning to restart its auctions business. Although Spring 2015 ws pencilled in for the first event, one does not seem to have taken place as yet.   

Nevertheless, Tu has confidence in the auxciton concept. “The deal rate depends on the market demand and patent quality,” he said. “We believe ICAP is more than capable of running the auction successfully and increasing the exposure of the patent sales opportunity we are presenting.” MiiCs will continue in its efforts to monetise any of the patents that fail to sell at the auction, Tu stated - so indicating that, wisely, he sees the auction as part of a proces not the end of one.