A group of tech heavyweights, including Apple, Google and Facebook, have joined forces to purchase approximately 1,100 digital imaging and processing patents from Eastman Kodak for $525 million, the company announced Wednesday. Once a thriving camera and photo company, Kodak filed for Chapter 11 in early 2012, hoping to restructure.
Intellectual property aggregators Intellectual Ventures and RPX organized a consortium of 12 tech companies — Adobe, Amazon, Apple, Facebook, Fujifilm, Google, HTC, Huawei, Microsoft, RIM, Samsung and Shutterfly — to make the purchase. Each company will split the $525 million cost.
The portfolio was said to be worth around $2.5 billion, but Kodak settled for the $525 million. Partially, that's because Kodak isn't in the position to negotiate. But it's also because Kodak extensively licensed these patents to other companies. "That makes the portfolio far less valuable, because there's very little exclusivity when a patent has already been licensed to someone else," says Harvard Business School professor and former Kodak VP Willy Shih.
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