Florian Mueller for FOSS patents:
The most interesting economic information is that Motorola, according to the brief, “demand[s] that Apple take a license at a rate that was more than 12 times what Motorola was charging other licensees for the same technology–a rate that was unfair, unreasonable, and decidedly discriminatory”. The public version of the brief obviously does not contain any such thing as a list of various Motorola license deals. But it becomes clearer and clearer that Motorola’s 2.25% demand is unrealistic and not supported by the deals it actually concluded. Apple says that the demand, corresponding to about $12 per iPhone, “was more than 12 times what Apple was already paying to license Motorola’s SEPs”, apparently referring to what Apple was paying indirectly through the use of Motorola-licensed baseband chips.
From Apple’s opening brief in this appeals case:
Motorola has sued Apple in various forums for infringement of eight SEPs (presumably, its eight strongest SEPs) and is batting 0-for-8 in establishing liability in U.S. actions.
Don’t be evil, Google.
…on the 2+ year-old iPhone 4, the 3+ year-old iPhone 3GS, and the 4+ year-old iPhone 3G…plus the first iPad from 2010 and the iPad 2 from 2011.
Mind you…on a SEP, which is exactly what Samsung said would hurt customers.
Yesterday afternoon a UK court handed Samsung yet another loss in it’s FRAND fight against Apple. Samsung wanted 2,5% of the resale price of every 3G-enabled device Apple sells – an outrageous amount by FRAND standards.
The score so far:
Apple 24 worldwide wins
Samsung 3 worldwide wins – two of those in it’s home country, all of those on appeal
Oh and, Sir Robin Jacob has declined to work for Samsung…just sayin’…
Big win for Apple and the EU regulators.
Samsung is still suing Apple for monetary damages, but FRAND/SEP patents are off the table now.
The FTC staff has made a recommendation to it’s commissioners to sue Google for violation of antitrust laws, because of Google’s attempt to block sales of competitors products with standard-essential patents.
Google has publicly opposed the use of patents against its Android operating system program, and launched an initiative in 2010 intended to derail public support for H.264, calling the technology patent encumbered” and recommending its own freely obtainable WebM as an alternative. Google has also charged Apple in the court of public opinion with abusing patents, which it has repeatedly characterized as being limited to “rectangles and rounded corners.”
However, after paying $12.5 billion to acquire Motorola Mobility, Google has made no changes to the struggling hardware maker’s efforts to block the sale of products by Apple and Microsoft, leveraging its own H.264 patents as a weapon to do so. Motorola has portrayed its lawsuits as an effort to “defend” Android against claims by Apple and Microsoft that Android infringes upon their patents, while also describing its standard essential patents as the “one bullet” needed to kill its opponents.
I recommend reading both articles quoted.
According to Florian Mueller of FOSS Patents, judge Barbara B. Crabb granted a number of summary judgements to Apple in it’s Wisconsin trial against Motorola.
After this partial summary judgment win, Apple is in pretty good shape with a view to the Wisconsin FRAND trial, which is scheduled to start on November 5, 2012. It still has the burden of proof on its claim that Motorola’s 2.25% royalty demand is inconsistent with FRAND, and there are some other requirements to meet, but the issues have been narrowed ocnsiderably. Almost exactly a year after Google announced its acquisition of Motorola Mobility, and only days after Google announced mass layoffs at the acquired company, Friday’s decision is only the latest event of many that call into question the patent strategy behind that $12.5 billion impulse buy.
Google and Motorola are about to merge into one company with the former taking over the later.
This gives Google access to the vast patent warchest of Motorola, and they intend to use it.
Last week several reports out of Europe and the US have highlighted Motorola’s stance on FRAND patents, demanding 2,25% of the final sales price of a finished product like the iPhone.
Apple has filed a complaint with the EU about this practice, arguing that Motorola is essentially blackmailing them with standards relevant patents. Late last week they also sued Motorola in California to stop using FRAND-related patents in litigation.
This week Microsoft asserted the same claims against Motorola in the EU, after Google firmly stated that they intend to continue in Motorola’s footsteps after the aquisition.
It seems that Moto is also demanding 2,25% of Microsoft’s offerings, which comes to about 22,50 USD on a 1.000 USD notebook. This is for around 50 patents Motorola holds on the H.264 video standard alone.
Compare this to, according to Microsoft, the 20 cents it has to pay a consortium of 29 companies that hold about 2.300 H.264 patents.
The message Googlorola is sending is clear: It takes only one FRAND-patent bullet to kill you.
The problem they are facing is this: Neither Motorola, nor Google have really invented anything. They mostly just copy. FRAND-litigation will eventually stop. It has to, or everybody loses. The lawmakers know this, and the courts around the world know it too.
Consider this: It takes about 50.000 FRAND patents to build a modern smartphone. If one company doesn’t honor FRAND, and get’s through with it, then why should the others? So if Googlorola get 2,25% of the final product (not the cost of the chip that uses it’s patents!), that comes out to roughly 15 USD per smartphone, if said phone costs 700 USD. Again, it takes about 50.000 FRAND patents to make a modern smartphone…
This will not happen. The courts will stop them, and then companies like Apple and Microsoft will assert their non-FRAND patents. You know, the one’s where a company actually invents and innovates? Yeah, the one’s Googlorola do not have.
Reckoning day is coming.