Google says it won’t support fair licensing in open standards as Apple, Microsoft, Cisco have
In a distinct departure from the agreement voiced between Apple, Cisco and Microsoft regarding the need for fair, transparent, understandable and consistent licensing policy for open standards, Google has promised to continue to wage Motorola’s increasingly hostile patent wars.
While initially described in a report by Bloomberg as an assurance that Google would continue “Fair Licensing for Motorola Patents,” along similar lines voiced by Apple, Cisco and Microsoft, a letter from Google to the IEEE standards body suggests just the opposite.
Despite waging a war in the court of public opinion last year in which Google boldly accused its competitors (principally Apple, Oracle and Microsoft) of waging a “bogus” “patent attack” on Android, Google letter to the IEEE indicates the company plans to maintain the same kind of closed, unreasonable patent demands it has long portrayed itself the victim of in patent lawsuits.
FOSS Patents writer Florian Mueller wrote today that Google’s letter to standards bodies “indicates no improvement whatsoever over Motorola’s FRAND litigation tactics,” noting that while the letter “spans over four pages,” it still “fails to provide satisfactory answers to those burning questions,” issues related to the definition of fair, reasonable and nondiscriminatory licensing and the use of injunctions as political theater to push unconscionable licensing terms on competitors trying to license standards essential intellectual property.
Google’s letters to the standards bodies “aren’t meant to improve anything,” Mueller writes. “Google is basically saying that it will do exactly what Motorola is already doing now.”
Google “explicitly endorses” Motorola’s position that 2.25 percent royalties of the “net selling price of end products” are “fair and reasonable,” while leaving the door open to seek court injunctions against companies that are still negotiating these onerous terms, essentially using open standards to threatening to kill competitors’ products untiles they agree to pay Motorola, soon to be a subsidiary of Google, significant ongoing royalties completely unrelated to the value those patents add to the overall product in question.
Mueller observed, “To me it looks like Google is taking an extreme position now so it can easily make concessions going forward. It would be a terrible precedent if regulators contented themselves with this.”
He adds, “the third paragraph (out of 13) [in Google's IEEE letter] is totally sufficient to see that Google doesn’t want to promise any improvement. It s commitment to be ‘consistent with MMI’s longstanding practice’ — less than a week after MMI just forced Apple to remove various products from its German online store over a standard-essential patent — is a threat, not a reassurance.”
Rather than asking for 2.25 percent royalties of chips that use standards patents, such as a 3G baseband component, Google is clearly stating that any product that incorporates a 3G chip must pay 2.25 percent royalties based on its list price, future that Mueller earlier estimated would amount to $10 per iPhone.
A year ago, Google complained that Microsoft’s portfolio of a range of mobile patents it sought to win from various manufacturers, which amounted to around $15 in total per device, was a conspiracy to “make it more expensive for phone manufacturers to license Android (which we provide free of charge) than Windows Mobile.”
Google is now saying that one patent owned by Motorola is worth two thirds of Microsoft’s entire mobile patent portfolio. Google also outlines a strategy for an “all-cash license option,” which Mueller describes as “out of step with FRAND. It’s prohibitive, with the sole purpose being to force other companies to let Google user their standards-unrelated patents.”
In paying billions for Motorola and other patent troves, Google is working hard to buy the clout it hopes to use to enable it to continue to disregard existing members’ intellectual property claims the same way Nokia and Samsung pursued: leverage essential standards as a way to gain access to the original patents of competitors.
Apple settled with Nokia but is still in legal contention with Samsung, Motorola and HTC. Apple has specifically complained that Android licenses are muddling the waters between the patents they have already contributed to standards (and which therefore have little bargaining power) and original patents argued by Apple, which its competitors could avoid infringing, work around or ignore as features.
Mueller concludes that Google’s stance against transparency and fair licensing practices in open standards “boils down to saying that Google supports everything MMI has done, and after the acquisition, Google will continue those litigation tactics but obviously with far greater resources and a broader set of strategic objectives, all of which will result in an exacerbation of the problem.”