On the one hand, the tech industry is awash in patent trolls, companies that own generally spurious patents for technologies they didn't really invent, which exist solely to sue other companies into licensing said technologies. On the other, we have tech companies that have patents for technologies that they did, in fact, invent (or at least purchase legitimately) and, as important, use in actual products. These companies, too, must sue others to protect their patents, but for far more legitimate reasons.
Google is upset about the latter kind of company, and it's citing two heavy-hitters, Apple and Microsoft, as example of companies that own patents and are using the legal system to prevent other companies from infringing on their protected technologies. More specifically, these companies are using their patents in a war against Google's Android OS, which is of course the dominant market leader. In poor Google's world, these companies are out for no good.
But what's the argument here, exactly?
According to a blog post that voices this complaint, and I'm using its exact wording here, "Android is on fire. More than 550,000 Android devices are activated every day, through a network of 39 manufacturers and 231 carriers."
Oh. Great. So there's no cause for alarm, right? I mean, Android is already running roughshod over the rest of the mobile world, including industry darling Apple's iPhone. Right?
Wrong.
"Android's success has yielded ... a hostile, organized campaign against Android by Microsoft, Oracle, Apple and other companies, waged through bogus patents," Google Senior Vice President and Chief Legal Officer David Drummond writes in the post.
Ah, bogus patents. I'm curious how that was determined. Let's read on. Surely, this will be explained. After all, it's an incredible charge to make publicly. There must be proof and some public explanation of why that word was used.
"They're doing this by banding together to acquire Novell's old patents and Nortel's old patents (the 'Rockstar' group including Microsoft and Apple), to make sure Google didn't get them; seeking $15 licensing fees for every Android device; attempting to make it more expensive for phone manufacturers to license Android (which we provide free of charge) than Windows Phone 7; and even suing Barnes & Noble, HTC, Motorola, and Samsung. Patents were meant to encourage innovation, but lately they are being used as a weapon to stop it."
Actually, using patents in this way is a legitimate business endeavor with no proof of "bogusness." But I am curious, if Google had in fact won these patents for itself, would that have made them "non-bogus"?
I'm sure he'll explain the bogus comment. Let's keep reading.
"A smartphone might involve as many as 250,000 (largely questionable) patent claims, and our competitors want to impose a 'tax' for these dubious patents that makes Android devices more expensive for consumers. They want to make it harder for manufacturers to sell Android devices. Instead of competing by building new features or devices, they are fighting through litigation. This anti-competitive strategy is also escalating the cost of patents way beyond what they’re really worth."
Again, no explanation of the bogus claim is made, though he does repeat the charge ("largely questionable patent claims"), place the word tax in quotes, suggesting that these companies use this term themselves, and then add a more general "anti-competitive" charge. The thing is, this activity is the very notion of competitiveness. Patents are designed to protect intellectual property, which are a competitive advantage. In many ways, Apple, Microsoft, and whoever else owns these patents actually protecting them is what makes this activity competitive. Google can't just use protected technologies owned by other companies without paying for them. That is competition.
But wait, I'm sure he'll explain why the patents are bogus. Let's keep reading.
"The winning $4.5 billion for Nortel’s patent portfolio was nearly five times larger than the pre-auction estimate of $1 billion. Fortunately, the law frowns on the accumulation of dubious patents for anti-competitive means — which means these deals are likely to draw regulatory scrutiny, and this patent bubble will pop."
Laws do not "frown" on anything; something is either legal or illegal. And again the charge of "bogusness" is raised ... without any explanation of why they might in fact be illegitimate. And then there's some lovely speculation about regulatory scrutiny and what the resulting action might be.
But let's say Apple and Microsoft overpayed for the patents in order to attack Google. Let's say this is in fact anti-competitive behavior. How does that makes the patents bogus? It doesn't.
"We're determined to preserve Android as a competitive choice for consumers, by stopping those who are trying to strangle it."
Wait for it, this is going to be good.
"We're looking intensely at a number of ways to do that ... We're looking at other ways to reduce the anti-competitive threats against Android by strengthening our own patent portfolio. Unless we act, consumers could face rising costs for Android devices — and fewer choices for their next phone."
So let's recap.
Google believes that Microsoft's and Apple's purchases of patents are anticompetitive, and that the mobile patents they own are bogus. To combat this, Google is going to acquire its own (bogus?) patents.
And I'd also point out that Google licenses Android for free. So by raising the price of Android by imposing licensing fees on technologies Android is in fact using, Apple, Microsoft, and others are arguably simply leveling the playing field and taking away an artificial Android advantage, forcing the OS to compete more fairly. Arguably, by "dumping" Android in the market at no cost, Google--which has unlimited cash and can afford to do such a thing--is behaving in an anticompetitive fashion. In fact, one could argue that Google is using its dominance in search advertising to unfairly gain entry into another market by giving that new product, Android, away for free. Does this remind you of any famous antitrust case?
And where's the harm to Google here? How can Google, which commands almost double the market share of the next closest competitor in this market and is, in fact, seeing nothing but continued growth, argue that its competitors are acting anti-competitively? (The numbers: Apple activated a bit less than 30 million iOS-based devices--iPhones and iPads--in the past quarter. According to the Google figure cited above, it is activating almost 50 million Android-based devices in the same time period.)
And speaking of harm, isn't Google's Android dumping harming competition? After all, the mobile OS makers it is competing against developed and paid for the technologies they use, and it's reasonable for them to recoup those costs through the sale of their systems. Why is it OK for Google to steal their ideas and then give the resulting product away?
There's no David in this story of Goliaths. But give me a break. Google has simply cast a light on its own dark secrets. It is Google, not Apple and Microsoft, that is behaving badly here.
