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Apple paid $2.6bn of $4.5bn Nortel patent grab

Worth it to give Google's 'pi' a poke in the eye?

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Apple has revealed that it paid somewhere in the neighborhood of $2.6bn for its share of the recent Nortel patent-acquisition deal.

"On June 27, 2011, the Company, as part of a consortium, participated in the acquisition of Nortel's patent portfolio for an overall purchase price of $4.5 billion, of which the Company's contribution will be approximately $2.6 billion," Apple noted in its quarterly form 10-Q, filed with the Securities and Exchange Commission on Wednesday.

The consortium to which Apple refers included Microsoft, RIM, EMC, Ericsson, and Sony, which beat out Google in a bidding war. The patent portfolio the consortium acquired was Nortel's treasure trove of more than 6,000 patents covering 4G and wireless broadband, which will provide critical ammunition in the ongoing wireless patent wars.

At the time of the deal, RIM said that it had contributed $770m, and Ericsson revealed their $340m payout. Apple – as is its wont – remained silent, but the SEC likes to know about these things, so the amount was listed in the 10-Q filing.

Google's original bid for the portfolio was $900m – a sum, obviously, that eventually looked paltry by comparison when the final offer ended up to be five times larger.

The bidding process, as reported by Reuters, was at times surreal, with Google making bids based upon such mathematical concepts as Brun's constant, the Meissel-Mertens constant, and even pi – one Google bid was, yes, $3.14159bn.

As one source told Reuters: "Either they were supremely confident or they were bored."

When the bidding ended and the consortium won, the chairman and CEO of one major patent-enforement firm told Bloomberg: "This is by far the biggest patent auction in history, both in terms of number of patents sold and in terms of the price tag. Nobody expected the price to get this high."

Rumors at the time said that Apple's contribution was in the $2bn range – hardly peanuts – but $2.6bn makes the lion's share a cool 58 per cent. ®

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