How do defensive patents held in a company's portfolio, like those in semiconductors, generate value without asserting commercial use?

They function as bargaining chips in cross-licensing agreements, securing market access and avoiding legal fees.

In technology sectors characterized by inevitable infringement claims, such as semiconductors, defensive patents serve a strategic, non-commercial purpose. A company might stockpile thousands of these patents with no intention of ever asserting them directly against product sales. Instead, they are utilized as leverage during negotiations with competitors. These assets allow the company to engage in cross-licensing agreements, thereby securing their own freedom to operate in the market and avoiding potentially billions in costs associated with protracted legal disputes, illustrating that value can be realized through risk mitigation rather than positive cash flow.