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Bill Bennett


Apple, Microsoft sue Google, Android phone makers

Last week Rockstar Bidco, a group of phone makers including Apple and Microsoft, filed a suit against Google and Android phone makers for infringing five of its patents.

The patents were acquired from the wreckage of Nortel for US$4.5 billion after a bidding war. Google lost that auction. The winning consortium includes Apple and Microsoft as well as BlackBerry, Ericsson and Sony.

Now, as expected, the patents are being used against Google and its Android partners. The defendants are Samsung, LG Electronics, HTC, Huawei, Asustek, Pantech and ZTE Corp – pretty much everybody who is anybody in the Android world.

Rockstar patents certainly not worthless

Because Google also bid billions for the same patents, it’s going to find it difficult to argue they are worthless.

All Things D has the main news story and a copy of the litigation document.

Yes it’s a mess.  And yes, it shows there’s something rotten with the entire patent system. As John Gruber at Daring Fireball points out, don’t feel sorry for Google. It is just as bad.

So what?

What does the patent action mean in practical terms for phone users like you and I?

Rockstar’s action hangs on five patents that revolve around matching search terms with advertising and user data. In other words, serving personalised advertising. This is central to Google’s business model. Apple, Microsoft and their partners are attacking the core of Android.

Should the Rockstar consortium win, Google will probably have to pay damages. Phone makers may have to halt sales – at least temporarily. It’s possible a settlement will include changes to Android. This could, in turn, mean forced upgrades and even some loss of functionality. Maybe even breaking some apps. All of this will be a short-term disruption.

It could also mean paying licence fees to Rockstar. This will undermine Google’s free-OS-and-apps-in-return-for-advertising business model. It will almost certainly make Android a more expensive option for phone makers. Google may just make advertisers pay more to target Android users.

There’s little chance Google and it’s partners will take this lying down. There could be protracted litigation. If they have any means to retaliate, you can rest assured they’ll be firing their weapons in the coming days. One possibility is less Google support for non-Android operating systems.



7 thoughts on “Apple, Microsoft sue Google, Android phone makers

  1. From my perspective these patents apply more to the proprietary code Google uses in its services more than the core of Android. I think this is like Apple’s previous attacks on OEMs where they are implicated by having devices that run offending code (which I’m sure is all in Google Play Services) rather than anything else which really should mean if Google is reprimanded for it then OEMs should be unaffected.
    Yeah, but this is gonna be another circus.

  2. Do we know how much Google and its partners have been asked for in license fees for these patents?

    Do we know whether Google and its partners were made an offer to join the consortium, so no one needed to get sued or pay license fees?

    Google bid almost as much for these patents, and then when they failed to get them they spent three times more to secure Motorola’s patents (and going concern business), which they have been actively suing the others over for some time already.

    Paul Graham’s tweet “The world changed today. Apple definitively crossed over into evil.” was ridiculous, unless you believe that Google was already there.

    It certainly seems fair to me that Google and its partners should pay for a fair share of these patents, whether by joining the consortium, or by paying licensing fees to it.

    If you go by volume of handsets shipped then a fair amount would be somewhere around $3B – $3.5B.

    (and the reverse by the others for some proportion of the Motorola patents, though Google surely overpaid there)

    1. “Paul Graham’s tweet “The world changed today. Apple definitively crossed over into evil.” was ridiculous, unless you believe that Google was already there.”

      Agree totally. Either they are all evil on this or none of them are.

  3. You all probably already know this, but MS’ biggest mobile OS in terms of revenue (by far, apparently) is… Android. http://www.zdnet.com/apples-new-iphones-are-fine-but-microsoft-really-profits-from-smartphones-7000020502/ Microsoft makes much much more by shaking down Android OEMs with threats of patent lawsuits (for extremely questionable patents, I would add, but it costs $millions to prove that in court, and the courts in the US aren’t particularly fair or reliable) than it does with its flagship Windows Phone 8 OS and its various half-baked tablet efforts…

    1. True. It’s worth seeing the almost us$1 billion Microsoft dropped on the original Surface early this year against the close to US$2 billion picked up from Andriod licenses.

      1. Stinks to me. MS haven’t *earned* very much… they’ve just got a LOT of inertia.

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