Nokia IP

1. 1 © Nokia 2014
IPR Value Creation
Jukka Nihtilä, Director, IP Business Development
November, Espoo, Finland

2. 2 © Nokia 2014
Nokia Technologies IP Business
• 30k patents and applications
• Based on a €50 billion cumulative
R&D effort (1991-2013)
• Focus on Standard Essential Patent
Licensing

3. 3 © Nokia 2014
IPR Value Creation in 2006
”IPR creates value in many ways”

4. 4 © Nokia 2014
• Increased pressure to realize the value of from patent portfolios
• Driven by the increasing cost of patenting and patent portfolio maintenance
• and highly publicized examples of large settlement payments and patent sales
• Patent monetization has become an accepted - even required - practice
1. Patent licensing
2. Patent sales
IPR Value Creation today – Focus on Patent Monetization

5. 5 © Nokia 2014
• US patent licensing market $50bn to 500bn *)
• Patent licensing is a fundamental element of the high tech economy
- An enabler of new entrants
- Ensuring fair compensation for technology contributors
• Well established practise in tech industries
- Telecom
- Computer hardware/electronics
- Medical devices
Patent Licensing
*) Deloitte & Touche LLP, 2007 and U.S. Bureau of Economic estimate for 2012

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Key players in the tech industry
”The Billion Club”
Licensing companies

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• Both licensors and licensees have been practising ...
• 3rd party advisory services exist to support
• Early settlements rare, enforced patents will be challenged
• Cost and time to license revenue increasing
• ”Hybrid deals” used to open deadlocks
• The importance of patent quality remains
Patent Licensing is becoming increasingly sophisticated

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• Some patents may create more value outside your portfolio
• Emergence of patents sales market
- Intellectual Ventures acquisition program since 2003
- High-profile transactions - Nortel 2011, AOL 2012, Kodak 2012
• Market today
- 815 open market portfolios on sale in 2013 (RPX)
- 50% of today’s open market portfolios transact in 6 months
- 30-40% of seller’s low-end expectations
Patent sales

9. 9 © Nokia 2014
• Peak transaction value reached
- Nortel: ~1MUSD per US patent
- Current average: $150-250kUSD per US patent
• Supply increasing
- Large tech corporations – not only US and EU but JP and CN as well
- Universities
- Individual inventors
- Patent factories
• Strong demand for high-quality patents and concentrated portfolios
- Large technology companies - ”new entrants” in the Tech industries or companies entering new market segments
- Patent aggregators (IV, RPX)
- Buyer consortiums (Nortel, Kodak)
- Patent licensing companies
- Sovereign wealth funds (France Brevets, Intellectual Discovery, IP Bridge, Ruichuan)
Patent sales going forward

10. 10 © Nokia 2014
• IPR value creation increasingly focused on financial return on the IP
assets
• Patent licensing calls for quality, scale and creativity
• Patents sales continue to be a key element in patent monetization
Conclusions

11. 11 © Nokia 2014
Thank you!
Any questions...