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Sony Buys Out Ericsson’s Stake in Sony Ericsson, Gets Broad IP Cross-Licensing Deal and Ownership of Five Key Wireless Patent Families

October 27, 2011

Wireless giant Ericsson on Oct. 27 announced that Sony Corp. is buying its stake in the Sony Ericsson joint venture for 1.05 billion euros in cash and getting broad IP cross-licensing and ownership of five key patent families covering wireless handset technology.

According to Ericsson’s press release, the deal also “gives Sony an opportunity to rapidly integrate smartphones into its broad array of network-connected consumer electronics devices - including tablets, televisions and personal computers - for the benefit of consumers and the growth of its business.”

The press release explained that this 10-year joint venture has run its course, having moved from a mobile market with simple phones to one with smartphones that encompass access to Internet services and content. This purchase, it said, “is a logical strategic step that takes into account the nature of this evolution and its impact on the marketplace.”

"This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want. With a vibrant smartphone business and by gaining access to important strategic IP, notably a broad cross-license agreement, our four-screen strategy is in place. We can more rapidly and more widely offer consumers smartphones, laptops, tablets and televisions that seamlessly connect with one another and open up new worlds of online entertainment. This includes Sony's own acclaimed network services, like the PlayStation Network and Sony Entertainment Network," said Sir Howard Stringer, Sony's Chairman, Chief Executive Officer and President. Mr Stringer also noted that the acquisition will afford Sony operational efficiencies in engineering, network development and marketing, among other areas. "We can help people enjoy all our content - from movies to music and games - through our many devices, in a way no one else can."

"Ten years ago when we formed the joint venture, thereby combining Sony's consumer products knowledge with Ericsson's telecommunication technology expertise, it was a perfect match to drive the development of feature phones. Today we take an equally logical step as Sony acquires our stake in Sony Ericsson and makes it a part of its broad range of consumer devices. We will now enhance our focus on enabling connectivity for all devices, using our R&D and industry leading patent portfolio to realize a truly connected world" said Hans Vestberg, President and CEO of Ericsson.

The transaction, which has been approved by appropriate decision-making bodies of both companies, is expected to close in January 2012, subject to regulatory approvals.


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