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Like Yahoo, a dying internet giant is looking to unlock the value of its patent portfolio. AOL did it in a way that won't blacken its reputation in the tech wo

by bproper 15y ago

Like Yahoo, a dying internet giant is looking to unlock the value of its patent portfolio. AOL did it in a way that won't blacken its reputation in the tech world. But it also won't be able to get recurring revenue from the majority of its patents. What's interesting to me is that AOL is so focused on how this money will flow back to shareholders. It's like Tim Armstrong is buying himself some breathing room with the street to get his business (media/ad sales) moving in the right direction.

fleitz 15y ago
That's 10 cents per share, considering their EPS is 14 cents, it's a pretty good deal. I wonder how they intend to invest that cash though, on the surface it seems the thing to do would be to return it to shareholders.
- ralfd 15y ago
  It is a good deal. A few days ago there were speculations AOL would get much less for it: http://www.bloomberg.com/news/2012-03-29/aol-inc-s-patent-sale-may-yield-290-million.html http://www.bloomberg.com/news/2012-03-29/aol-inc-s-patent-sa... "AOL Inc.’s Patent Sale May Yield $290 Million … It’s worth much less than what investors have estimated, based largely on the fact that most of AOL’s patents are not commercially viable, or junk grade.
rbanffy 15y ago
> a dying internet giant is looking to unlock the value of its patent portfolio. Selling it to another dying giant that will use it against each and every competitor that doesn't have a cross-licensing agreement.
- therealarmen 15y ago
  Microsoft is a dying giant?
_delirium 15y ago
> But it also won't be able to get recurring revenue from the majority of its patents. True, but $1b is so much money that it probably overvalues the lifetime revenue AOL would be able to get from the patents, even assuming they'd step up aggressive enforcement leading to licenses/settlements. They would need a few really big wins out of those 800 patents for the average lifetime revenue to top $1.25m/patent.

by bproper 15y ago

fleitz 15y ago

That's 10 cents per share, considering their EPS is 14 cents, it's a pretty good deal. I wonder how they intend to invest that cash though, on the surface it seems the thing to do would be to return it to shareholders.

ralfd 15y ago
It is a good deal. A few days ago there were speculations AOL would get much less for it: http://www.bloomberg.com/news/2012-03-29/aol-inc-s-patent-sale-may-yield-290-million.html http://www.bloomberg.com/news/2012-03-29/aol-inc-s-patent-sa... "AOL Inc.’s Patent Sale May Yield $290 Million … It’s worth much less than what investors have estimated, based largely on the fact that most of AOL’s patents are not commercially viable, or junk grade.

rbanffy 15y ago

> a dying internet giant is looking to unlock the value of its patent portfolio. Selling it to another dying giant that will use it against each and every competitor that doesn't have a cross-licensing agreement.

therealarmen 15y ago
Microsoft is a dying giant?

_delirium 15y ago

> But it also won't be able to get recurring revenue from the majority of its patents. True, but $1b is so much money that it probably overvalues the lifetime revenue AOL would be able to get from the patents, even assuming they'd step up aggressive enforcement leading to licenses/settlements. They would need a few really big wins out of those 800 patents for the average lifetime revenue to top $1.25m/patent.