In our recent article, we explained that during the times of economic uncertainty, patent portfolios can become excellent revenue generators. Case in point: last week, Broadcom sold its IoT patent portfolio to Synaptics for $250 million in an all-cash transaction. Not a bad chunk of change.
Over the last decade, Broadcom built an expansive patent portfolio covering key wireless connectivity technologies. The patents focus on aspects of Wi-Fi 6, Bluetooth 5.2, and GPS L5. Because these technologies will likely become the cornerstone for smart device connectivity, Broadcom’s patent portfolio will likely become highly disruptive. Broadcom’s strategy to patent what is necessary paid off, giving Broadcom significant leverage in the rapidly developing IoT field.
Recognizing that Broadcom’s patent portfolio has the potential to provide a significant competitive advantage, Synaptics spent $250 million to acquire this coveted asset. Synaptics projects that Broadcom’s patent portfolio will add approximately $65 million in annual revenue. Synaptics CEO lauded this deal as a major win: “the addition of best-in-class wireless connectivity technology to our portfolio significantly enhances our overall position.” Clearly, with the acquisition of Broadcom’s patent portfolio, Synaptics seeks to position itself as the leader in the IoT field. As for Broadcom, $250 million in hard cash can go a long way during the uncertainty of COVID-19 pandemic.