Watch for assertion against companies operating across mobile devices, messaging and wireless networking technologies
1st August 2023
Key Patent Innovations and the BlackBerry portfolio
Background
The BlackBerry patent sale to Dublin-based Key Patent Innovations (KPI) completed in May 2023.
The transfer of non-core patent assets to KPI represents a material increased risk to companies operating across mobile devices, messaging and wireless networking technologies.
BlackBerry, formerly Research In Motion (RIM), has an established history of successful litigation against tech power players including NXP, Qualcomm, Apple and Facebook.
KPI provided an update on its progress with monetising the portfolio in the weeks following the deal completion stating that “…significant efforts are underway to demonstrate the value of these patented inventions to potential licensees.”
The company also confirmed that it had made numerous hires including licensing executives and patent lawyers with specific expertise in monetising patents equivalent to what is acquired.
Update – August 2023
It was reported that BlackBerry were being sued for a refusal to pay its own IP advisors in the sale. The article referred to 32,000 patents being involved in the deal.
Cipher analysis of the BlackBerry portfolio
Using the Cipher Universal Technology Taxonomy, we have identified the top areas of technology innovation protected by the BlackBerry portfolio.
These include:
- Wireless Networks
- User Interface
- Security
- Social Media
- Antennae
The above list combined covers 60% of the BlackBerry portfolio.
Assets within the top technology category of Wireless Networks – 21% of the full BlackBerry portfolio – are likely to have been included in the deal.
Assuming that this is the case, this places KPI as the top tier non-practicing entity (NPE) owner of wireless network technology area patents, ahead of Intellectual Ventures, OT Patent Escrow and WSOU Holdings.
Geographical and competitor breakdown
The core markets protected by the BlackBerry portfolio are the US and Europe.
Screening across the top US and Europe innovators in wireless networks is an obvious place to start building an opportunity pipeline of assertion targets.
Material revenue generating companies in this list include Qualcomm, Samsung, Apple, Deutsche Telekom, NTT, Intel, Sony, Alphabet, AT&T, Cisco Systems, Verizon and more.
For KPI, readiness and preparation is the game now to ensure the best defence against this rising NPE threat.
The Deal
The deal was delayed in part by the failure of Catapult IP to secure financing for the previous $600 million agreement announced in January 2022.
Having missed agreed deadlines, Blackberry terminated the agreement with Catapult IP in Dec 2022 and shortly after announced a new deal with Dublin-based Malikie Innovations, a subsidiary of Key Patent Innovations, which completed in May 2023.
Patents that are essential to BlackBerry’s current core business operations were excluded from the transaction.
BlackBerry receives a license back to the patents sold, which relate primarily to mobile devices, messaging and wireless networking. The sale included in the region of 32,000 patents and applications.
BlackBerry received $170 million in cash on closing. The deal terms also include a guaranteed payment of US$30 million to Blackberry within three years and a profit-sharing agreement capped at a $700 million royalty share of future profits.
This deal sees BlackBerry high-grade its patent portfolio to the core assets that underpin its operational business segment of Software and Services.
The deal will allow BlackBerry to focus its strategic efforts on building its core Cybersecurity Platform and IoT Solutions offerings which combined generated $624 million in revenue for fiscal year 2022.
As a footnote, Catapult IP is claiming breach of contract. This despite missing the previously agreed deal deadlines and with the lending syndicate led by Toronto-based investment firm Third Eye Capital having pulled funding.
Download Blackberry Patent Report
Blackberry Patent Report – Update
This snapshot report includes sections on:
- Classification of inventions
- Quality of inventions
- Invention ages (and expiry dates)
Original deal analysis
Cipher produced a report at the time of the Catapult IP deal in February 2022. Our original observations are available as an ungated report.
Cipher analysis of the BlackBerry Patent deal (Feb 2022)
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