If Solid sells off Pantech’s Internet (IoT) business after pulling out of Pantech's smartphone business and selling its smartphone patents, Pantech will be virtually broken up. When Solid sells off the company in July as planned, Pantech, which is a synonym for a myth of a venture start-up’s success will withdraw from all of its business and evaporate in 26 years. At the same time, Solid’s “sell-parents-and-run away” possibility will become a reality.
Pantech made a lot of the world's first attempts so its patents received a lot of attention from other cell phone manufacturers. In 2014, when Pantech went into a court receivership, due to poor management, and the sell-off of the company proceeded, many people strongly voiced that Pantech should not be sold to a foreign company as it can risk leaks of patents and technologies. Even when Solid took over Pantech in July 2015, there was a view that Solid acquired Pantech for patents only." But Solid dismissed such an allegation by saying, “We will nurture our overseas smartphone businesses in foreign countries such as Indonesia."
In May, “We will abandon Pantech’s smartphone business,” Solid announced. “We will focus on the IoT business." With reference to the announcement, “Pantech has competitiveness in the field of the IoT as the company engaged in the field for a long time,” experts said. “It will create synergies with Solid’s business.” In fact, Pantech is supplying chipset-type communication modules using LTE-M technology to S One, the Ministry of Land, Infrastructure and Transport (the DTG Project), SK Hynix and KEPCO. The company is also developing products targeting the narrowband IoT (NB-IoT) market, which is attracting attention as a next-generation technology. The NB-IoT market is actively invested in by mobile telecommunication companies such as KT and LG U+. The NB-IoT market is considered a market with a higher potential as because NB-IoT is cheaper than LTE-M and can transmit a small amount of data.
However, this time Solid decided to sell Pantech's final business, the IoT, clarifying its intention to shut down Pantech. In particular, an allegation is strengthening that Solid was interested in Pantech’s patents rather than Pantech’s human resources or business in the first place, including Pantech’s NB-IoT development materials with high growth potential in the list of items to sell off.
Solid decided to give all of Pantech’s materials about new products under development as well as Pantech’s goodwill to its customers to “W” Company during sell-off negotiation with “W.” We will proceed with contracts for a transfer of the goodwill and development materials first and discuss products and human resources later. After all, Pantech will be completely closed down, and Solid will have remaining patents only.
"Employees who believed in Jung Jun, CEO of Solid were stupid," said a researcher who worked at Pantech. “I wonder why the court gave Solid permission to take over Pantech after seeing Solid fired Pantech employees on four occasions, leak Pantech’s technology and sell off Pantech’s expensive equipment."
"After the acquisition, Solid officially showed its commitment to maintaining Pantech’s business while continuing to study withdrawal from the Pantech’s business internally," a former senior Pantech official said.
The mobile phone industry has been concerned about a possibility that Solid will sell off Pantech’s patents for money and shut down the company since Solid acquired Pantech. Although the courts attached Pantech employees’ job security as a condition for Solid’s acquisition of Pantech, eventually the number of Pantech employees was pruned to less than 50 in two years, and Pantech’s assets were sold out one after another. "Solid will sell off all of Pantech's business and assets except for patents," an industry representative said. “As Solid mentioned the normalization of management through selling patents, there is a growing concern about technology leakage." As of the end of March, Pantech had 2,036 domestic patents and 1,111 overseas patents.
Meanwhile, Solid has steadily sold Pantech's assets and patents since acquiring Pantech in December 2015. In October of last year, 230 US patents were transferred to Gold Innovations, raising concerns about "technology leaks," and 11 of these were bought by Apple. Gold Peak is a patent firm founded in October last year, just before Solid began to sell off Pantech’s patents. Gold Peak is seen as a partner planned for the sale of Pantech’s patents in mind. Patents owned by Pantech will likely continue to be passed on to other companies in the US, India, and China among others through Gold Peak and other channels.