Google Tried Bidding Geeky Numbers For Nortel Patents; How About $3.14159 Billion?

from the taking-this-seriously? dept

Tue, Jul 5th 2011 7:05am — Mike Masnick

Reuters has put together a nice recap of what happened inside the Nortel patent auction, which resulted in Apple, Microsoft, EMC, RIM, Ericsson & Sony getting the patents for $4.5 billion. There are a bunch of interesting bits of information in there, but one of the most bizarre is that rather than bidding round numbers, like pretty much everyone else, Google bid weird numbers that only geeks would recognize:

At the auction for Nortel Networks' wireless patents this week, Google's bids were mystifying, such as $1,902,160,540 and $2,614,972,128.

Math whizzes might recognize these numbers as Brun's constant and Meissel-Mertens constant, but it puzzled many of the people involved in the auction, according to three people with direct knowledge of the situation on Friday.

"Google was bidding with numbers that were not even numbers," one of the sources said.

"It became clear that they were bidding with the distance between the earth and the sun. One was the sum of a famous mathematical constant, and then when it got to $3 billion, they bid pi," the source said, adding the bid was $3.14159 billion.

Yes, they bid pi. Really not quite sure what to make of this. It could be Google hoped that they'd be able to "signal" to geeks their feelings about the whole process (which the company had been pretty clear about all along -- it didn't want to buy the patents, and seemed to think the whole process was stupid, but it felt compelled to, because it would be even worse if the patents ended up with someone else). However, it certainly does come off as pretty damn cocky -- an attitude that Google is frequently criticized for. Still, it also suggested the level of seriousness (i.e., not much) with which Google treated this whole process. It had to bid a lot of money, but the numbers acted as a bit of a protest for the mess which put them in a position where they felt they needed to do so.

The other interesting bit in the tick tock was how the groupings came about, with coalitions forming as different companies dropped out. Apparently, Intel bid heavily, and when it dropped out, there was a fight between Apple (who put together the winning coalition) and Google over who it would team up with. Intel eventually chose Google.

Of course, that setup makes the whole process seem even sillier. Once they get down to two "teams" why not then just all join forces and set the bid lower (divided among more partners), rather than continue to use each other to drive the bid higher. Well, there's one reason: if the winning bidder intends to use the patents against the losers... Google (with Intel's help) wasn't willing to go to $4.5 billion, but it seems likely they'll end up paying one way or another, down the road, thanks to the new "winners" of the patents.

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Filed Under: geeky, numbers, patents, pi
Companies: google, nortel

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JackHerer (profile), 5 Jul 2011 @ 7:13am

Don't read too much into it
Google do this all the time, they floated 14,142,135 shares in their IPO. That is pretty much the square root of 2 (1.4142135).
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JackHerer (profile), 5 Jul 2011 @ 7:15am

Re: Don't read too much into it
Oh i forgot, their SEC filing for the IPO said they wanted to raise $2,718,281,828. e roughly = 2.718281828
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Gabriel Tane (profile), 5 Jul 2011 @ 7:15am

Sources?
'"Google was bidding with numbers that were not even numbers," one of the sources said.
Not even numbers? Who were these 'sources'? The Letter People?
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Gabriel Tane (profile), 5 Jul 2011 @ 7:18am

Re: Sources?
and as soon as posted that, I experienced my facepalm... the person should have said "bid with numbers that were not even"... Or "bid with odd numbers"... or "bid with numbers that were not rounded to the nearest Nth".

At least, that's what I hope they meant.
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johnjac (profile), 5 Jul 2011 @ 7:20am

better phones
How does this get us better phones?
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Anonymous Coward, 5 Jul 2011 @ 7:26am

Re: better phones
The companies that won the patent can now include this awesome tech in their upcoming phones. This would not have been possible without these patents. You are a fool if you think otherwise.
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John Doe, 5 Jul 2011 @ 7:29am

I think that is awesome...
The only drawback to Google running the bidding up is they have guaranteed that the winning bidders will use the patents to sue to get their "investment" back.
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Planespotter (profile), 5 Jul 2011 @ 7:32am

Awesome tech? These are patents and nothing else, not like copyright on an actual thing just the concept of such a thing. Whatever happens I am pretty sure we aren't going to see a massive boost in "awesome tech" on any phones anytime soon, whereas I'm pretty sure tech teams in isolation without ever seeing the patents will come up with similar ideas and be squashed from implementing them as the patent owners realise they have a way to monetise the patents and stop other companies from innovating in the market place.

What are patents for? I seem to have forgotten?
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Anonymous Coward, 5 Jul 2011 @ 7:38am

http://science.slashdot.org/story/11/07/02/1335202/Google-Bid-Pi-Billion-Dollars-For-Nortel-Patents

It seems some believe Google was simply trying to bid up the price to make everyone else pay more. They didn't want the patents, but they wanted to make sure that whoever got the patents paid a lot for them. This provides those with the patents with less litigation money for one thing, and less money to bid on future bids.
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Anonymous Coward, 5 Jul 2011 @ 7:40am

It is proof only that Google has way too much cash on hand, and is actually hurting the US economy by hoarding that cash rather than re-investing it in the marketplace.
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out_of_the_blue, 5 Jul 2011 @ 7:41am

Maybe Google is run by nutty numerologists.
"Really not quite sure what to make of this." -- Well, you filled otherwise empty page space with this bit of trivia, that's the meta-view.
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ChurchHatesTucker (profile), 5 Jul 2011 @ 7:43am

Re: Re: Sources?
I'm sure the competition wasted some time trying to figure it out, which is reason enough to do it.
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TDR, 5 Jul 2011 @ 7:44am

Maybe if they'd bid pie instead of pi, they might have gotten the patents. I hear apple or blueberry pie tend to be good for that sort of thing. ;)
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John Doe, 5 Jul 2011 @ 7:44am

Re:
I'm pretty sure tech teams in isolation without ever seeing the patents will come up with similar ideas and be squashed from implementing them as the patent owners realise they have a way to monetise the patents and stop other companies from innovating in the market place.

What are patents for? I seem to have forgotten?

Seems you understand patents pretty well.
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Anonymous Coward, 5 Jul 2011 @ 7:45am

Re:
No, those who actually got the patents are the ones with too much cash. They're the ones wasting it on patents instead of re-investing it on innovation.

Google didn't waste any money on these patents, they still have that money to re-invest. They simply bid the price up to make sure that their competitors didn't get all these patents for dirt cheap. It was actually pretty smart of Google.

Besides, if these sorts of patent auctions somehow promote innovation, then what's wrong with Google promoting this innovation by obtaining these patents. If anything, this is evidence that patents should automatically go into the public domain when a corporation goes bankrupt.
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John Doe, 5 Jul 2011 @ 7:45am

Re:
Says who? They are going to need that cash to pay out the "innovation tax" to the companies that just bought those patents.
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ClarkeyBalboa (profile), 5 Jul 2011 @ 7:51am

Re: Re: better phones
If these patents had gone into the public domain, then everyone would benefit from having this tech available to all manufacturers. That would have been of far greater benefit.
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The eejit (profile), 5 Jul 2011 @ 7:51am

Re:
Ah, the anti-Google crowd. What fo those who colluded to outbid Google? Did they have too much money as well, and are thus hurting the US economy?
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DannyB (profile), 5 Jul 2011 @ 7:52am

Re: better phones
> How does this get us better phones?

By rewarding innovators who are willing to invest heavily in future patent litigation risks. That's what made this country great. People willing to risk capital for the hope of future profits. It's capitalism.

We need a commodity market for trading in patent litigation futures. This will create incentives to further invest capital. It will create jobs -- for lawyers, traders and market managers.

It's a good thing I tell you. Those who suddenly find themselves (somehow!) with a new high school diploma in their hand, but lacking any useful talent or skills to do nerdy geek stuff like "hi tech" can find a comfy job behind a desk. They can help create demand for cool new phones by posting more "kick in the balls" videos, or becoming a major Twit posting about which color lipstick or shoes to buy.

Without our God given right to patents, how would any innovation get done? If other countries start out innovating us, we'll just sue and collect patent royalties. God bless our American lawyers. Eventually if everyone can make a good living collecting patent license royalties, then we will have solved one of mankind's oldest problems and nobody will have to work anymore -- freeing up time to enjoy our new better hi tech phones and concentrate on the fight over whether patent royalties or copyright royalties are more morally better.

It's a bright innovative future!
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techflaws.org (profile), 5 Jul 2011 @ 7:53am

Re: Maybe Google is run by nutty numerologists.
Don't be jealous, bozo.
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Esahc (profile), 5 Jul 2011 @ 7:54am

I personally like to think they were just having a little fun with it. If I had that kind of cash I'd do it too.
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Anonymous Coward, 5 Jul 2011 @ 7:55am

Re:
As opposed to Microsoft, Apple and others, who are moving the economy by spending money buying patents (and invisible, intangible good that can become worthless in a blink of an eye)?

Real smart...
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Anonymous Coward, 5 Jul 2011 @ 8:02am

Re:
Besides, whoever gets those patents will likely sue everyone for them anyways. Might as well make sure they have less money to sue with.

It was a mistake that Google avoided patent bids for so long. Even if they didn't win many these auctions, at least they could have made sure that those who do win pay a hefty price for those patents, which would have given Google an even better competitive advantage. Avoiding (patent) bids just because you don't think you will win them is a mistake. Make your competitors pay for whatever is being auctioned.
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Anonymous Coward, 5 Jul 2011 @ 8:05am

Re: Re:
many of these auctions *
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el_segfaulto (profile), 5 Jul 2011 @ 8:08am

Re: Re: better phones
It sounds like you don't like America's number one TV show, "Ow My Balls!" I'm going to need to see you at the nearest reeducation center immediately.
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Atkray (profile), 5 Jul 2011 @ 8:11am

Re: Re: better phones
You won't be laughing when this gets implemented.
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Anonymous Coward, 5 Jul 2011 @ 8:17am

Patent cash buying madness. LE SIGH :(
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DannyB (profile), 5 Jul 2011 @ 8:31am

Re: Re: Re: better phones
What do you mean when?

You must be behind the times. :-)
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DannyB (profile), 5 Jul 2011 @ 8:31am

Re: Re: Re: better phones
Assumes facts not in evidence. :-)
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Anonymous Coward, 5 Jul 2011 @ 8:45am

Re: Re: Re: better phones
That's the freetard in you speaking.
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Marcel de Jong (profile), 5 Jul 2011 @ 8:53am

Re: Re: Sources?
540 and 128 are pretty even in my book.

The pi billion, that's just hilarious.
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GeoOT, 5 Jul 2011 @ 9:06am

Re: Re: Sources?
Gabriel- There is a term in mathematics for numbers of this ilk. The formal term is an Irrational number. (see the Wikipedia article) The term makes the Google bids (almost) rational.
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toyotabedzrock (profile), 5 Jul 2011 @ 9:14am

Why would anyone see this as "cocky"?

Sounds more like an observation based on age discrimination given the age of the Google founders.
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Danny (profile), 5 Jul 2011 @ 9:52am

/smirk
At least they didn't bid 8675309
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anymouse (profile), 5 Jul 2011 @ 9:53am

Re: Re: better phones
Learning from the general trends of the auto, banking, and home mortgage market fiasco's over the last several years, the next young group of ruthless business executives had no idea that their 'get rich quick' scheme would be the final straw that would cause the entire US economy to collapse overnight.

When asked to explain how their 'get rich quick' scheme caused economic fallout that made the great depression look like a minor economic event, all their CEO, Dick ScrewedemGood could say was, "It seemed like the next step in the securities market... taking junk mortgages, combining them, collateralizing them, and selling them to unsuspecting investors as collateralized mortgage objects was such a resounding success that we decided to do the same thing with patents. We took all the junk patents, combined them into one big object, broke the object up into multiple 'options' that could be purchased, then sold all the options to companies looking to protect themselves from being sued for patent infringement. Sure we suspected that there might be some litigation here and there, but since nobody really knows what 'patents' are in the little pieces they bought, nobody should be able to use them to litigate... who knew the judges would decide that all owners had an equal share in all patents, resulting in the current nuclear patent litigation we have going on today..."

Sure, I'm full of it now.... but just wait for someone to try it (I'm patenting this business model, so if anyone is interested, hit me up for the licensing fee).
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Anonymous Coward, 5 Jul 2011 @ 10:13am

Re: Re: Sources?
Don't worry, I thought the same thing. That sentence could have used some different punctuation or it could have been left out completely. Is that really the best quote that was available?

"The numbers. The NUMBERS! Their not even!!!"
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theangryintern (profile), 5 Jul 2011 @ 11:30am

Re:
I dunno, I'd think the fact that over 20,000 people have jobs because of Google is doing a lot to help the economy.
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abc gum, 5 Jul 2011 @ 12:04pm

Re: Re: Re: better phones
If it looks like a bubble and pops like a bubble ...
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This isn't really necessary, 5 Jul 2011 @ 12:51pm

get your math together
Let me get this straight: "pi" can't be bid. Pi is a number, and doesn't have a dimension (e.g. meters, volts, dollars, etc.). So "pi" billion dollars is a bid, but "pi" is not. I just couldn't keep it inside me, sorry about that.
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Bengie, 5 Jul 2011 @ 1:18pm

Re: Re: Re: better phones
Google doesn't plan to charge for them, but they can use them as arsenal.

If someone claims Google is using their patent, Google can turn around and claim they're also using one of Google's patents.

Instead of anyone getting sued, they license out each other's patents for free.
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Anonymous Coward, 5 Jul 2011 @ 1:26pm

Re: Re: Re: Re: better phones
says the copyrightard
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Anonymous Coward, 5 Jul 2011 @ 1:30pm

Re: Re: Re: Re: Re: better phones
err... in this case patentard, i guess... whatever
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Lawrence D'Oliveiro, 5 Jul 2011 @ 3:23pm

Re: Maybe Google is run by nutty numerologists.
�Numerologists� only know enough about number theory to add digits together. Their idea of �advanced maths� is using numbers to count positions in the alphabet. They wouldn�t know what an �irrational number� was, they�d think it was one that needed therapy.
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Tom, 5 Jul 2011 @ 3:23pm

Irrational bids
I think the best comment I've read on this was (IIRC) from slashdot, where a user implied what Google may have been signaling was how irrational software patents are...
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trish, 5 Jul 2011 @ 4:23pm

Tom
WIN
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Anonymous Coward, 5 Jul 2011 @ 7:31pm

Re: Re: Re: Sources?
Er, no. Pi is actually a transcendental number, not irrational.
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Anonymous Coward, 6 Jul 2011 @ 1:31am

it will just make the cost of phones higher!
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Cowardly Anon, 6 Jul 2011 @ 6:48am

I have to say when I read this, it made me smile. It actually fell under the category of good news for me. I shared it with some of my co-workers and they all agreed. Google is awesome, and they just gave us a reminder as to why they are awesome.

As to why Google would do this? To get people talking about it. "Google Bids 3mil on Patents", isn't as great a headline as "Google Offers Pi for Patents". It gives reporters, yourself included Mike, something to write about beyond what happens. You speculated and wondered and it made for a better story. A better story that people will remember. A better story that people will talk about.

One of my co-workers didn't even know the Nortel patents were up for sale. Another didn't know patents could actually be bought.

By doing this, Google is opening the lines of communication on a system that most people don't know or care about. And that is the true reason why Google is awesome.
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Anonymous Coward, 6 Jul 2011 @ 7:21am

Next time I play Gazillionaire, I'm totally going to bid 31416 on a spaceship upgrade.
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Richard (profile), 13 Jul 2011 @ 3:45am

Re: Re: Re: Re: Sources?
Trancendentals are also irrational...
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