Apple Hoards $76 Billion, Looks to Bolster Patents, Cloud

Apple is sitting on a $76 billion cushion, more cash and investments than any other tech company, leaving it plenty of ammo to acquire start-ups and bolster its patent portfolio.

The Cupertino, Calif.-based company's second number represents over $12 billion dollars in cash, with the rest mostly in marketable securities.

Some investors want Apple to return some of that money to stockholders in the form of dividends. But Steve Jobs addressed the company's resistance to do that in a conference call last year, saying Apple wanted the money available to further expand business in the future.

The company has not stated exactly how it will spend its safety net, but over the past several months, Apple has made business moves that demonstrate the kind of expenditures where the reserves may come in handy.

Patent litigation has become one of the company's primary concerns of late. The patents formerly held by the Toronto-based Nortel, which filed bankruptcy in 2009, recently sold for $4.5 billion. Apple was part of the group that won an auction for the patents, and it contributed more than half of the amount paid at approximately $2.6 billion.

The battle over the Nortel patents is likely to lead to even more expensive patent battles in the future. Apple and Google are already eyeing the company InterDigital, a firm that owns over 9,000 wireless design patents and has 10,000 more pending. Companies now have a lot to gain by acquiring patents, as it protects them in patent infringement cases with competitors.

Apple is engaged in plenty of legal battles, including an ongoing imbroglio with Samsung, involves patents both sides may have violated when making their smartphones and tablet devices.

While the case may prove costly for both sides, it has also threatened to dismantle the companies' lucrative relationship with each other as supplier and consumer, illustrating the several layers of damage these patent disputes can inflict. Current court cases show patent lawsuits seem to be increasing, creating another front for companies to monitor and maintain.

In addition to fending off patents, Apple has a few other long-term projects demanding resources. The company has poured millions of dollars into a massive data center in North Carolina to support its new iCloud data service. The basic iCloud service will be free for customers, and while Apple has made strides signing on industry labels, it will likely have to continue to rely on its extra cash to build upon it, and keep ahead of the competition.

Apple also has announced plans to build a new campus to accommodate the company's growth. Just the land alone for this project is estimated to have cost Apple over $300 million. As this project moves forward to its anticipated 2015 completion, CEO Steve Jobs has hinted at Apple's plans, which includes a revolutionary and costly new design.

Apple may have a lot of money left over, but as the industry and mobile market in particular become more competitive and new points of battle open up, the company may find itself with a lot more places to spend its extra cash.

Apple Hoards $76 Billion, Looks to Bolster Patents, Cloud originally appeared at Mobiledia on Thu Jul 21, 2011 3:31 pm.