ALCATEL-LUCENT, the latest technology company to announce plans to make money from its patents, may generate several hundred million euros this year alone from its trove of 29,000 rights, according to its chief financial officer Paul Tufano.
France’s largest telecommunications equipment maker is offering access to its patents through a licensing syndicate.
Asked whether the deal with RPX would generate a few hundred million euros, Mr Tufano said: “More than that.”
After consuming about €3.5 billion in cash over five years since the 2006 merger of Alcatel and Lucent Technologies, the Paris-based company is following rivals such as Ericsson to set up a licensing strategy as spending by phone operators on network gears slows.
Alcatel-Lucent could generate €500 million to €1 billion in revenue in 2012 from the patents, according to four analysts.
“Licensing is a hot trend in the tech sector right now, but if these numbers turn out to be true, maybe Alcatel should stop everything else and do only licensing,” said Thomas Langer of WestLB Equity Markets in Dusseldorf.
Google bid $12.5 billion last year for Motorola Mobility Holdings as part of a growing trend of technology companies buying patents to defend themselves again intellectual-property suits.
Alcatel does not plan to sell its patent portfolio, which includes voice-recognition and video-conferencing technology, chief executive Ben Verwaayen said on a conference call yesterday. “By syndicating the patent portfolio, we found a creative way to extract value without weakening ownership.”
Asset disposal has been part of the chief executive’s turnaround plan for the company. Mr Verwaayen, who took over in 2008, has sold a stake in the aerospace manufacturer Thales. Alcatel-Lucent this month completed a $1.5 billion transaction to sell its Genesys call-centre software unit to Permira Advisers.
Alcatel-Lucent stock jumped as much as 22 per cent early yesterday, after the gear maker forecast higher profit margins and positive cash generation in 2012.
Alcatel reported its first full-year net profit in six years, although it has pushed back to 2012 its goal of generating positive cash flow. – (Bloomberg)
