Encryption Patents Could Be Blackberry’s Biggest Asset

With the company’s mobile devices widely seen as obsolete, it’s hard to see who would be tempted by Blackberry’s announcement last week that it is up for sale. Yet Blackberry does have some technology of its own likely still growing in value. Blackberry subsidiary Certicom owns patents crucial to using a form of encryption that the US and other governments say is the best way to protect sensitive data, and should replace the methods relied on to secure the Internet today.

Certicom’s near monopoly on implementing that technique, known as elliptic curve cryptography, means it is rarely used today outside of emails sent by Blackberry devices and communications by the US and other governments. But there is widespread belief in the computer security industry that elliptic curve cryptography will inevitably become the main way data is secured.

The National Security Agency’s webpage urging a shift to elliptic curve cryptography cites the reason to do so as:

“[T]he evolving threat posed by eavesdroppers and hackers with access to greater computing resources…Elliptic Curve Cryptography provides greater security and more efficient performance than the first generation public key techniques (RSA and Diffie-Hellman) now in use.”

As I reported earlier this month, one group of security experts has even suggested that advances in math research could make those standard encryption techniques useless in just five years (see “Math Advances Raise Prospect of Internet Security Crisis”).

Today, relatively few people are making use of Certicom’s elliptic curve patents because licensing them is very expensive. The US government negotiated a special licensing deal that allows its departments and agencies as well as their contractors to use the technology. A handful of other large companies are known to have licenses of their own, including Motorola (now part of Google), Oracle and defense contractors General Dynamics. Certicom has already proved that getting around its patents isn’t easy, forcing Sony to settle out of court when the company used elliptic curve encryption on Blue-ray DVDs without paying a license fee.

Blackberry paid $106 million (double its initial bid) for Certicom and its patents in 2009. They could now be worth a lot more, given the potential to license them widely if prices were set correctly.