Jack Ellis

According to news stories coming out of India last week, the country’s Competition Commission (CCI) has given the green light to a sale by Motorola Mobility of assets – including patents – to Intel. The Economic Times reports that Intel and Google-owned Moto entered into an asset purchase agreement in December and subsequently approached the CCI for approval, which has now been granted. The Times says that Intel will acquire “certain assets of Motorola Mobility such as non-Indian intellectual property rights, including patents and patent applications”, as well as  “tangible assets of the company located in the US” and “rights to hire some American employees of Motorola Mobility”.

There does not seem to be any news of this reported deal from sources outside India, but from the sounds of it the transaction could have significant implications beyond the country’s borders. While the quantity and technological application of the patents involved is unclear – as is the price that Intel is paying for them – the deal could be a substantial one (though if it is, of course, you have to wonder why no announcements seem to have been made by either Intel or Motorola).

If there is a deal, it would not be a huge surprise: the two companies do have a recent history of cooperation. They struck up a partnership in January 2012, with Intel-powered Moto smartphones hitting shelves towards the end of last year. Furthermore, the chip manufacturer’s recent acquisitions of IP have strongly hinted that it intends to make an even more significant entrance into the handset market. In June 2012, Intel paid InterDigital $375 million for 1,700 patents and related rights in the 3G, 4G and wi-fi technology spaces. At around the same time, it completed the purchase of patents and patent applications relating to wi-fi and LTE from Aware Inc for $75 million.

It is also worth remembering that Intel teamed up with Google in an ultimately unsuccessful attempt to outbid the Rockstar consortium at the Nortel patent auction in June 2011. And they strengthened their alliance in September of that year when they agreed to partner on Android-related R&D. It has been suggested that Google’s outright purchase of Motorola Mobility in the aftermath of the Nortel auction was primarily motivated by a desire to land Moto’s 17,000-plus patents. Executive chairman Eric Schmidt’s insistence that the purchase was about “more than the patents” has not been universally accepted inside the company, let alone outside it, with some commentators very sceptical of Schmidt’s claim; since the takeover, Google has sold off parts of the business, shut down facilities (including one in India) and announced large-scale redundancies.

Nevertheless, if the CCI-approved deal does go through, it would make a lot of sense for both companies. Intel will shore up its patent portfolio as it prepares to push into the smartphone space, while Google will divest itself of assets that are superfluous to its own business objectives while strengthening the hand of an Android traveller, and at the same time getting back at least some of the massive $12.4 billion it spent on acquiring Moto in the first place.