“Apple Inc. is fighting a multi-front patent war against competing makers of mobile devices, demanding injunctions that would block sales of their products. But the company has also indicated a willingness to cut deals with competitors, according to people familiar with the matter,” Ian Sherr reports for Dow Jones Newswires.
“The consumer-electronics company has put forth proposals to Motorola Mobility Holdings Inc. and Samsung Electronics Co. to settle some pending litigation in exchange for royalty payments to license its patents, among other terms, these people said,” Sherr reports. “This is not a new tactic; Apple had some discussions with companies such as Samsung before initiating litigation, according to statements made to a court in at least one suit. Apple isn’t attempting to offer patent licenses to all its competitors or create a royalty business, one person familiar with the matter said.”
MacDailyNews Note: See: Apple licensed iOS scrolling patent to Nokia and IBM, offered license to Samsung – December 4, 2011
“However, some people familiar with the situation see more reason for Apple to consider legal settlements,” Sherr reports. “One factor is that Android has proliferated so widely that shutting the software out of the market using injunctions is no longer practical, one of the people said. Licensing is an alternative that could add cost to Android development and make it less appealing for manufacturers. Apple, of Cupertino, Calif., has asked for between $5 and $15 per handset for some of its patents in one negotiation, or roughly 1% to 2.5% of net sales per device, another person familiar with the matter said. Motorola, for its part, has been criticized for asking for 2.5% of net sales per device for its wireless patents from Apple.”
MacDailyNews Take: Motorola Mobility’s are FRAND patents. Sherr should have pointed that out directly. A reporter interested in conveying the full truth would have done so. FRAND patents do not command 2.5% royalties, especially when the technology is already licensed by Apple from Qualcomm.
“None of the people could confirm if settlement talks are currently taking place, but say this is part of an ongoing process,” Sherr continues, “Any offer to license patents would seem to oppose statements from co-founder Steve Jobs, who died in October.”
MacDailyNews Take: If you can’t kill it with injunctions, you can price it out of existence. Jobs certainly understood that.
Sherr repots, “The company told an Australian court last year that Jobs had begun discussions with Samsung in the summer of 2010, in part because of the close relationship between the companies. But those talks broke down when Samsung released its first Android- based tablet, the Galaxy Tab, in the fall of 2010.”
MacDailyNews Take: Which was basically a total iPad knockoff except for the inferior OS, watered-down third-party software, anemic ecosystem, and malware problems.
Read more in the full article here.
MacDailyNews Take: Again: If you can’t kill it with injunctions, you can price it out of existence. Dead is dead, no matter how it was killed.
Related articles:
Google ordered by judge to give Apple information on Android development – March 5, 2012
Microsoft joins Apple in FRAND patent fight in EU against Motorola Mobility – February 22, 2012
Apple sues Motorola Mobility over Qualcomm license – February 10, 2012
Apple asked standards body to set rules for essential FRAND patents – February 8, 2012
EU launches full-blown investigation of Samsung’s suspected abuse of FRAND-pledged patents; Motorola on notice – January 31, 2012
Apple licensed iOS scrolling patent to Nokia and IBM, offered license to Samsung – December 4, 2011
My first instance where I disagree with a major decision Tim Cook is making for Apple.
He should not license Apple’s technology.
I don’t know how true this story is, but one has to look at the big picture. Much of Android’s popularity is based upon its “free” nature. Between Microsoft, Oracle and Apple, that status could change significantly. Bringing parity to the cost of the OS will force buyers to compare more on quality, where iOS excels. The Android “horse” is out of the barn. Microsoft already decided that there is no putting it back, and I think they are right. Apple has a lot of critical patents, and some that are not so critical to differentiation. For some patents it may make sense accept a license fee rather expending resources on litigation.
The beauty of licensing is the cost to Google.
Think of how many of those 850,000 daily activations are going into things that aren’t used as smart phones or personal internet devices. It really starts to make this thing totally uneconomical for Google to sustain.
I think you got excited too easily. Calm down, does Tim want to license or this idiot writer Sherr says Tim want to license. The writer place the power of FRAND patents above non-FRAND patents, which immediately discredit his story. He doesn’t even understand the basic facts of patent war. Such a ignorant fool.
Agreed with Kelly – DO NOT LICENSE any of iOS to Google.
Steve wanted to go global thermal nuclear on Android not Let’s Make a Deal with Bob Barker or the Moleman Eric.
Ka-Ching!
C’mon Tim . . . Keep up the Thermonuclear Assault!!
de guello.
$5-15 per patent per device can add up. Spit that out as a dividend to AAPL shareholders and everyone is happy 🙂 I feel there may be some truth to the theory that Android has proliferated too deeply to be wiped out – might as well take some money from that while continuing to take the vast majority of profits in the industry.
That is the same logic as letting some other person have regular sex with your partner as long as they pay you a fee for the privilege.
Apple had no intention of licensing it’s Patented IP to someone selling a cheap knockoff and this is in essence what they would be consenting to.
As a shareholder not only no but HELL NO.
Burn the houses of the Fandroid Theft Ring/ Google Crime Family ™© down to the ground.
No. I don’t agree with licensing. Apple should kill/destroy/thermonuclear Google/Android as Steve wants done. Do not forget that Apple people!
The writer of article is a idiot or ignorant. He doesn’t even know difference between FRAND patents and non-FRAND patents. Read this sentence “By comparison, some of Apple’s rivals are wielding broader patents that may have been deemed essential for creating wireless communication devices.” By the definition of FRAND, patent holders must license in the FRAND term, which industry going rate is 1 to 2c per chip.
Makes perfect sense.
apple already knows it can beat these guys in the market, might as well make a few extra bucks off of them while they are alive vs. throwing massive chunks of money to the lawyers on cases Apple may well not win, or may not get injunctions with.
Licensing is a far safer bet, or even cross licensing in cases where a competitor has non FRAND patents that could cause issues for Apple.
Disagree. Apple doesn’t need to make a few extra bucks the MacroSloth way by squeezing money.
This fight is almost over, Google is against the ropes, why help them out when Microsoft and Rim have at least created a OS to compete. Google stole – so – Terminator style — Destroy all bots — death to Android.
The logic in that article is soo effed up. Someone has been robbing you and since they have been doing it so successfully we are not going to arrest the thief and make restitution. We instead are going to reward them with a license to steal in perpetuity.
That is the simple translation of the bullshit thinking espoused regarding the Fandroid Theft Ring. Apple has a right to keep it’s patented IP away from FRAND status and Google is in effect trying to force Apple into licensing technology they wished and have every right to keep exclusive.
You’re looking at it all wrong. It’s more like someone’s been robbing you, they’ve been caught, and now they’re going to have to pay you back the value of what they stole PLUS XX times MORE for years to come.
It also sends a clear warning to other thieves, that if you don’t pay for what you take, and pay dearly, we’re going to come after you.
The writer doesn’t understand lawsuits, business licensing, or how companies handle disputes privately. Apple doesn’t just run to the nearest courthouse and file a lawsuit when it first learns of a product which infringes on its IP.
The first thing Apple does is try to negotiate and reason with the offending company privately. This may include cease and desist letters, offers to license technology, lump sum settlement offers, etc.
The author clearly doesn’t understand that every case is different. For example, Apple recently won an injunction against Motorola for the Slide To Unlock patent. While that feature is very common on virtually all smart phones now, Apple has the authority of the court behind it for that patent. So Apple has two choices:
1. Play hardball and make Motorola change the OS so that it uses something other than Slide To Unlock (maybe Moto does a turn the dial to unlock, touch two corners, etc.); or
2. License Slide To Unlock to Motorola and collect royalties, thus making Android more expensive for Motorola to use and generating income for Apple (after all, just how crucial is Slide To Unlock to the overall iPhone experience now anyway?)
This is NOT “weakness” on Tim Cook’s part, but rather very shrewd actions designed to arrive at an acceptable and profitable result while protecting Apple’s property.
First of all, I don’t give much credence to unsourced articles like this one.
That said, if it’s true, I don’t like the prospect. In the world of IP defense, Apple distinguished itself in its approach by using patents to stop infringement. I’ve always associated the “licensing model” pursued by companies like Nokia and Microsoft as too close to those of the Intellectual Ventures and Lodsyses of the world – a characteristic of a companies that sought to turn a buck instead of standing behind the innovations they brought to market.
I realize this is an emotional reaction based on how Apple has always conducted itself – more “noble”, if you will. But I always want to think of Apple as a company that blew me away with innovation and protected what it made with an iron fist.
I’m sure I’m in the minority.
No you are not. I want Apple to be recognisable by distinctive features that Apple alone has access to. Core competency has to mean something.
“MacDailyNews Take: Which was basically a total iPad knockoff except for the inferior OS, watered-down third-party software, anemic ecosystem, and malware problems.”
MDN are you conceding that it has similar battery life, similar build quality, and price?
This is not news, as FOSS’ Florian Mueller has reported that in filings he found that Apple offered a licensing deal ages ago.
“Apple, of Cupertino, Calif., has asked for between $5 and $15 per handset for some of its patents in one negotiation, or roughly 1% to 2.5% of net sales per device, another person familiar with the matter said. Motorola, for its part, has been criticized for asking for 2.5% of net sales per device for its wireless patents from Apple.””
As MDN notes, this shows the writer doesn’t know anything as FRAND patents aren’t the same as unencumbered ones.