Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

In a bid to protect its patents related to Android and partners using the platform, Google Inc. recently filed a lawsuit against Rockstar. Google has asked the San Jose court to declare that its Nexus group of devices does not violate any intellectual property of Rockstar.

Earlier, Rockstar had accused Google and its partners of infringing seven patents, which it bought from bankrupt Canadian company Nortel in 2012. Rockstar is a consortium formed by Apple (AAPL - Analyst Report), Microsoft (MSFT - Analyst Report), Blackberry, Ericsson and Sony (SNE - Snapshot Report).

Rockstar is a patent holding NPE (non-practicing entity). In 2012, Rockstar spent $4.5 billion, of which $2.5 billion came from Apple itself, to buy a number of patents owned by the defunct Nortel.

The patents, which Rockstar now owns, mainly deal with basic smartphone functionalities such as "mobile hotspot functionality," and "Messaging and Notification." Since the purchase of patents, Rockstar has been trying hard to license them but met with little success. It faces the risk of losing the huge investment made by its members.

In order to survive, the company is filing lawsuit against the likes of Samsung, Asus, HTC and other device makers who use Android platform. However, Google’s attempt to save its partners may face procedural headwinds, as in the case of Cisco whose attempt to save its customers from patent violation claims in April this year was overruled by a federal court.

Nevertheless, we believe that Android’s growing popularity will drive top-line growth going forward. Google is a market leader in online advertising and has been trying to explore various ways to diversify its revenues and fight competition. Google continues to acquire smaller companies with specialized technology to boost its different offerings.

Google reported gross revenue of $14.89 billion in the third quarter of 2013, up 5.6% on a year-over-year basis. The company has expressed its intention to increase investment in its core products in the future.

Currently, Google has a Zacks Rank # 2 (Buy).
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
BITAUTO HOLD BITA 35.33 +14.82%
ANI PHARMACE ANIP 24.79 +14.66%
E HOUSECHINA EJ 10.99 +9.24%
CANADIAN SOL CSIQ 26.97 +7.15%
INTERNATIONA ICAGY 33.30 +5.38%