Patent Aggressor Microsoft Files EU Complaint Against Google/Motorola For Charging Too Much To License Patents

from the live-by-the-sword dept

It's difficult not to look cynically at Microsoft's latest move to file an antitrust complaint in the EU over Motorola's patent royalty rates, and think about just how obnoxiously hypocritical Microsoft is being as a company on this particular issue. First off, Microsoft has become a pretty significant patent aggressor over the past few years, filing lawsuits and pressuring companies to pay up. It's also been a huge fan of patent FUD -- especially against open source competitors. Most people assume that Microsoft was the main player behind SCO's quixotic (but costly and distracting) legal battle against Linux. Then, of course, every so often Microsoft officials insist that Linux infringes on a bunch of its patents, but it never wants to make clear which ones. More recently, of course, Microsoft has been demanding license fees for its patents from a variety of companies making use of Android -- to the point that some have argued Microsoft makes more off each Android installation than each Microsoft Phone installation.

Of course it was partly Microsoft's aggressive patent position against Android that put Google in the position of feeling compelled to buy Motorola Mobility to get its patent portfolio, mainly for the sake of protecting itself and having a bunch of patents that it could use as a shield against a lawsuit from the likes of Microsoft. Of course, Microsoft was already suing Motorola over the company's use of Android.

A few weeks ago, we discussed the tough spot that Google was in over Motorola's patents. The company has indicated that would keep in place Motorola's current patent licensing strategy. While many of us would prefer that Google make a big statement by freeing or opening up many of these patents, the company is actually in something of a ridiculous position: if it does that... its competitors (mainly Microsoft) will claim anti-trust violations by saying that the company is using its market position to undercut the prices that other charge.

It's other choice? Keep the current rates. And that's what it's indicated it would do... so the second that the EU and the US approved the merger, Microsoft files this antitrust complaint, arguing that the rates Motorola charges for its patents is too high. It's a damned if you do, damned if you don't position for Google. Keep the rates as they are, and they're violating antitrust rules by charging too much. Cut the prices or free up some of the patents, and it's an antitrust issue for leveraging their position and "dumping" in the market.

Of course, Microsoft's almost gleeful blog post about its complaint ignores all of this reality and history, and tries to position it as if Motorola and Google are trying to "kill" web and mobile video by charging too high a royalty rate. Frankly, for anyone who knows anything about Microsoft's patent practices over the past few years, they'll see through this and recognize how laughable Microsoft's claims are.

Either way, the situation is ridiculous. Fighting over patents doesn't help bring any new innovations to market. It just diverts money to the lawyers.

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  1. icon
    Walt French (profile), 27 Feb 2012 @ 9:47pm

    Central Thesis is Bogus, Must be Biased.

    “While many of us would prefer that Google make a big statement by freeing or opening up many of these patents, the company is actually in something of a ridiculous position: if it does that... its competitors (mainly Microsoft) will claim anti-trust violations by saying that the company is using its market position to undercut the prices that other charge.”

    I'm a bit of an expert on random number generation. Perhaps I know more than 99.995% of the world's population, while 300,000 people know more. So I claim authority in saying that this innovative legal theory is not some random collection of English words. Rather, it is meant to convey an argument, i.e., it has a motivation (in terms of quasi-random numbers, “is biased.”)

    The theory, as far as I can tell, has exactly zero precedent in any discussion of patents, FRAND, anti-trust legislation, recent comments by the US Dept of Justice or the EU Competition Commission. If anything, actually, the opposite: it rejects common-sense and well-established concerns about patent licensing.

    So the words didn't just arise from a cat walking on a keyboard, and they fly in the face of common sense. They must have been written with some purpose that ordinary common sense doesn't reveal.

    I will guess: the writer is trying to show a reason that Google (which explicitly signed off on Moto's patent actions, to the alarm of the DoJ and EU CC), and Motorola (now rebuffed another time by the Karlsruhe court) still wear the White Hats. Because wearing White Hats is important to telling who are the good guys in 1950s TV shows for adolescents.

    We statistician types always have to concede that we may be wrong: this silly claim, contradicted by all the facts, might have been purely accidental. I estimate — OK, SWAG — about a 0.01% chance that the writer simply was trying to get some page visits by writing something meaningless.

    It would be helpful, Mike, to know why you published this drivel after you got Twitter comments that said your “theory” had no relationship to reality, from an authority in the field. (Maybe there were more favorable comments, but they didn't exactly jump out of your thread.)

    So readers: Mike is apparently mealy-mouthing behavior by Motorola that he can't find a sensible justification for. He seems to be unhappy that his champions are stuck in something inexplicable. You are reading stuff that the word “agitprop” was invented for, perhaps inspired by the Department of Propaganda at Google. Or perhaps Mike volunteered to trash his reputation of sensibility for the good of The Cause. Whatever the reason (alas, detecting obvious bias is different from knowing what caused it), this is a rubbish claim.

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