Sonos patent win over Google brings IP monetization closer, Morgan Stanley says
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Sonos (NASDAQ:SONO) is 0.5% higher today after giving up some earlier gains following a victory at the International Trade Commission in a fight over patents with Google (GOOG
-0.7%, GOOGL
-0.7%) - and Morgan Stanley says the win brings Sonos a bit closer to monetizing its intellectual property.

The ruling is "further proof that Sonos has industry-leading IP that they can successfully defend in court," analyst Katy Huberty and team write.
It might not bring any direct monetary benefit - the ITC only implements trade-related rulings - but it proves two important points, Morgan Stanley says. First, "Sonos indeed has industry-leading audio technology IP," and second, "they can successfully defend said IP against competitors they believe unfairly infringe upon their technology."
Sonos has defended IP and negotiated licensing deals with smaller competitors, but Google is of a different scale, the firm says.
The audio company now has more negotiating power to either work out a licensing deal out of court, or use the ruling to strengthen its court case against Google (currently stayed) in California's Central District - where it could gain monetary rewards in the form of damages or an ongoing license payment.
One caution is that Google appears willing to keep making its case, meaning a negotiated settlement is the best case scenario vs. a protracted patent-infringement battle that could last years.
Morgan Stanley has an Overweight rating on Sonos with a $49 price target, now implying 69% upside.
During the holidays, reports suggested that Sonos was set to unveil a smaller, cheaper subwoofer.