The apple of Universal Display's (Nasdaq: PANL) eye is its extensive patent portfolio. It's what the company spends all its time working on, the source of direct license and royalty revenue, and generally the reason for Universal Display's very existence.

To supplement this cache of company-owned OLED patents, Universal Display also partners with three research universities and has exclusive rights to OLED patents springing from these partnerships. But that still wasn't enough: The company has been paying royalties to Motorola Solutions (NYSE: MSI) for 11 years in return for exclusive rights to 74 Motorola-owned patents in the field. Universal Display has been spending about $160,000 a year on these licenses.

Well, that's the end of that relationship: Universal Display has bought Motorola's OLED patents outright and won't be sending any more royalty checks.

We don't know how much Universal Display paid to bring those patents home, though I'm sure the question will be asked (and perhaps ducked) in next week's earnings call. Because the size of those royalty payments was calculated from Universal Display's OLED-derived revenue, the Motorola contract looked as if it would get more expensive over time. Cementing the cost now was probably a smart move, assuming that the price tag was reasonable.

A co-development deal with coating technologist PPG Industries (NYSE: PPG) is now the main intellectual property obligation Universal Display has to another company. That contract is due to expire in December and doesn't seem to produce many patents. It's more expensive than the Motorola clutch, but includes delivery of materials from PPG to Universal Display in a "cost-plus" arrangement.

When the PPG contract is renewed, I expect the terms to be quite different. A fly on the wall around those discussions would have a lot of juicy info to chew on.

Universal Display is consolidating its key assets as the market for OLED displays and lighting heats up. Samsung Display, AU Optronics (NYSE: AUO), and LG Display (NYSE: LPL) are all frantically building new OLED factories to keep up with rising demand. High-quality OLED displays have become a selling point for high-end smartphones and will do the same for TV screens once the panel manufacturers get their large-screen production lines up and running.

This stock has more than tripled over the last year and looks expensive with a history of negative earnings. Some analysts see an end to the red ink in the coming year, though the average tenor remains cautious. Where do you stand? Discuss in the comments below.

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Fool contributor Anders Bylund holds no position in any of the companies discussed here. Universal Display is a Motley Fool Rule Breakers recommendation. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.