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When A Company Fattens up its IP Portfolio...

Written By Brian Hicks

Posted January 28, 2014

HP Ipaq Apple iPhone Qualcomm Patents

The mobile device we hold in our hands each and every day becomes increasingly vital to our way of life– it holds the key to the way we act, interact, and react to the world and what’s going on around us. In the future, our reliance will only increase.

Qualcomm (NASDAQ: QCOM) is one company that has long understood this opportunity and the growing need for advanced mobile technology. With its latest acquisition, Qualcomm is set to take the mobile tech industry by storm.

It recently bought from Hewlett-Packard (NYSE: HPQ) a large patent portfolio with some of HP’s biggest and potentially greatest mobile technologies.

Qualcomm shelled out an undisclosed amount for some 1,400 patents and pending patent applications in the US, and another 1,000 patents and applications in other countries. Like the amount Qualcomm paid, the actual number of patents is unclear.

But without a shred of doubt, Qualcomm now owns a large part of our future mobile operating systems and what we can expect our future handheld devices to be.

The most notable patents were part of HP’s Palm, iPaq, and Bitfone properties, which were early smart device pioneers that ended up being a bit ahead of their time.

Palm’s story is important in the modern tech sector. It first took flight in the 90’s with personal data assistants (PDAs), and ended up releasing its first touchscreen smartphone in 2002, a full year before the first BlackBerry smartphone, and a whopping five years before the iPhone.

Palm was arguably the first real smartphone company. 

Unfortunately, it was also the first casualty of the smartphone wars, since it was a bit too visionary and not profitable enough. After attempting a final turnaround with the Palm Pre in 2009,  it ended up being acquired by HP who completely folded its operations during a dramatic period when the executives battled over the company’s direction.

The iPaq handheld suffered a similar demise. It was introduced by Compaq before the company was eventually bought out and dissolved by HP. HP then acquired Bitfone, a vendor of mobile device management software in 2006 in an effort to build up its iPaq platform, but it was all for naught.

By 2011, the mobile device lines were discontinued. What HP was left with was a decade worth of acquisitions and buyouts, and technology that was extremely valuable, but ultimately useless to a company whose most lucrative business was printers.

This is where Qualcomm steps in: a self-proclaimed leader in the future of the mobile industry. These fundamental mobile patents will broaden Qualcomm’s portfolio and deepen its licensing revenues, and also provide more flexibility to proceed with future developments, without incurring licensing charges to competitors.

While the sale price was not released, we do know that HP purchased Palm in 2010 for $1.2 billion, and then ended up writing down approximately $1.5 billion after HP realized it could no longer afford to pursue development of mobile technology.

Qualcomm (NASDAQ: QCOM)

Based out of San Diego, California, and started in 1985, Qualcomm, Inc. is engaged in the design and manufacturing of digital communications devices and services. The company operates in four segments: Qualcomm CDMA Technologies (QCT); Qualcomm Technology Licensing (QTL); Qualcomm Wireless & Internet (QWI), and Qualcomm Strategic Initiatives (QSI).

There are 157 Qualcomm locations worldwide as the name grows and becomes synonymous with mobile technology and the ever-growing popularity of the smartphone.

As part of this latest purchase, Qualcomm merges its mobile expertise with the iconic HP name that is so popular in the PC realm. This sale should set both sides up to benefit.

Early this week, Qualcomm has been slightly down, while HP rebounded from the previous week’s fall, a result of this agreement.


And while Qualcomm may still be finding its footing, it undoubtedly will bounce back, which will give rise to the company’s licensing partners.

The Qualcomm licensing page reads:

“The wireless industry was built on the notion that humankind can aspire to defy the authority of distance. It’s only fitting, then, that a wireless company needs to capitalize on resources far beyond its own walls to truly thrive.

At Qualcomm, we reach out to third parties all around the world to design, manufacture and sell products based on our industry-leading wireless technology. And with each innovation discovered, with each inventive solution developed, the entire wireless industry grows stronger as our licensees’ efforts encourage more users to join in the wireless revolution.”


The value of this patent portfolio is almost immeasurable if we think what Qualcomm might be able to deliver with its access. One thing is for certain: it will drive more value to current and future licensees.

The benefit abounds. They’re already a dominant maker of mobile chips, but with this added intellectual property, the sky just may be the limit.

And if you like to play the unknown and the possibility of what might be – something BIG – then Qualcomm might just be your ticket.

When you think mobile, think Qualcomm.