Googlorola’s problem.

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.


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