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Patent Case Could Shift Power Balance In Tech Industry

An anonymous reader writes A lawsuit between Apple and Google could drastically change the power balance between patent holders and device makers. "The dispute centers on so-called standard-essential patents, which cover technology that is included in industry-wide technology standards. Since others have to use the technology if they want their own products to meet an industry standard, the companies that submit their patents for approval by standards bodies are required to license them out on 'reasonable and non-discriminatory',(paywalled) or RAND, terms." If Apple wins, the understanding of what fees are RAND may decrease by at least an order of magnitude.

51 of 83 comments (clear)

  1. Apple has little to do with this by khoker · · Score: 5, Informative

    It's Google VS Microsoft. The first line of the link says as much. Apple only (rightfully) sided with Microsoft. They aren't involved in the lawsuit.

    1. Re:Apple has little to do with this by msauve · · Score: 3, Insightful

      It's Microsoft v. Motorola. Microsoft is the plaintiff, and the patents which Google acquired when it purchased Motorola Mobility are what's at issue, specifically what Google charges Microsoft to use them.

      But yeah, trying to say it's Apple v. Google is a troll.

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    2. Re:Apple has little to do with this by Anonymous Coward · · Score: 2, Insightful

      If it's a part of an "industry standard" then the patent should be FREE. Don't like that? Don't make your invention part of something that no one can avoid.

      While I agree, aren't Microsoft and Apple at least arguing in that direction (they want it to be cheaper and their foe wants the licensing to remain as prohibitively and market-entry-denyingly expensive as possible)?

    3. Re:Apple has little to do with this by brausch · · Score: 3, Insightful

      You've got it backwards/sideways/confused/something.

      Apple and Microsoft are on the SAME SIDE and are arguing FOR CHEAPER licenses.

      RTFM. It's only about one page long.

      --
      "Almost every wise saying has an opposite one, no less wise, to balance it." - George Santayana
    4. Re:Apple has little to do with this by thaylin · · Score: 1

      So you are saying MS and apple should be forced to release their industry standard patents for free, or at least a magnitude cheaper than they are now?

      --
      When you cant win, ad hominem.
    5. Re:Apple has little to do with this by Anonymous Coward · · Score: 1

      Yes. I don't understand why novel and useful inventions should be licensed for peanuts(preferably free apparently to M$ and Apple although IIRC M$ actually does own some standards patents unlike Apple who have nothing non-obvious, novel and useful) while utterly useless and obvious sh!t(complete w/prior art in the physical world) like unlock is somehow worth trillions.

      Also no, just because a particular invention is utilized in an industry standard does NOT mean that it should be free. The body creating the standard(s) should have taken that into consideration in the first place, but no they'd rather play with fire.

      Apple: AFAICT they don't/won't license anything that they can bilk for another dime... or preferably billions which I find to be hilarious as all of their patents over the last decade plus are trivial. i.e. they've probably done nothing useful since essentially abandoning AIM/powerpc and even then well before they really did abandon it. Probably everything useful was from the early 90s or earlier, while primarily IBM with some input from Motorola did the heavylifting later as IBM use power in workstations and servers, and Motorola sold fscktons for embedded applications while Apple was going to selfdestruct attempt #4(? or was it 3?). Either way they're looking to heading towards another one, but will probably survive again as they have piles of cash to carry them through it this time.

    6. Re:Apple has little to do with this by MachineShedFred · · Score: 2

      I don't understand why novel and useful inventions should be licensed for peanuts(preferably free apparently to M$ and Apple although IIRC M$ actually does own some standards patents unlike Apple who have nothing non-obvious, novel and useful) while utterly useless and obvious sh!t(complete w/prior art in the physical world) like unlock is somehow worth trillions.

      Because "slide to unlock" isn't necessary to communicate voice data and IPv4 packets to an LTE mast. If you can't see the difference between a patent on a radio or transmission scheme, and a design patent for a gimmicky touchscreen feature then you really have no business commenting on standards essential patents and the licensing schemes that surround them.

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    7. Re:Apple has little to do with this by Cederic · · Score: 1

      This is an excellent point.

      Expensive research, inspired innovation and extensive testing to assure reliable, robust and effective radio equipment should definitely be worth more than fucking obvious "do more than accidentally touch the screen to unlock" elementary design.

      So I agree entirely that there's a difference, and so do the standards bodies - they don't need a standard for sliding as it's such a trivial thing to think of, design and implement.

      After all, nobody is forced to comply with the standards, and anybody that participated in the R&D efforts behind them will benefit from the shared patent pool incorporated within them so it's not an undue burden on the companies that invested in the technology behind the standard. Unlike something as asinine as slide to unlock, where any attempt to charge another company would be pathetic anti-competitive abuse of an illegitimate government granted monopoly.

      Lovely to be able to agree with someone on Slashdot for once.

  2. Patent fees are always RAND... by Jax+Omen · · Score: 5, Funny

    specifically, RAND(toomuch,waytoomuch).

    1. Re:Patent fees are always RAND... by Jax+Omen · · Score: 3, Insightful

      Really? Downvoted for a bad programming joke?

    2. Re:Patent fees are always RAND... by ArcadeMan · · Score: 2

      Maybe it's because you had a . instead of a ; at the end of your code.

    3. Re:Patent fees are always RAND... by Jax+Omen · · Score: 1

      Okay that made me giggle.

      Although to be fair I never specified a programming language. Hell, I don't even know what languages my joke would have been valid in... I was thinking excel when I made the joke o_O

    4. Re:Patent fees are always RAND... by sexconker · · Score: 1

      You just made me very sad. Where do clever, informed tech people talk endlessly about news nowadays?

      I place my head in the toilet, my nose a millimeter from the water, and I converse with the pipes.

  3. So..? by bhcompy · · Score: 1

    So is the summary stating that Apple is trying to obfuscate the fee structure or trying to obfuscate which patents are subject to RAND terms?

    1. Re:So..? by Lunix+Nutcase · · Score: 1

      Doesn't matter much since Apple isn't part of the case. They just submitted an amiscus backing Microsoft.

    2. Re:So..? by Lunix+Nutcase · · Score: 1

      Amicus, thatis.

  4. Hmm... by pushing-robot · · Score: 4, Insightful

    Can't say I'm rooting for either party here, but I hate the idea of SEPs in general... If a method is literally the only permitted way to do a thing, should it be patentable?

    --
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    1. Re:Hmm... by erice · · Score: 4, Interesting

      Can't say I'm rooting for either party here, but I hate the idea of SEPs in general... If a method is literally the only permitted way to do a thing, should it be patentable?

      If there is only one way to do it, then it is a fact of nature and can not be patented. Also, if the standard has been published, that counts as prior art so no new patents can be applied there. However if I choose to create a standard that requires your existing patent, why should that give me the power to invalidate your patent?

      Standards bodies usually try to avoid patents but this is often not practical because there are so many patents and the best solution is often patented.

    2. Re:Hmm... by AmiMoJo · · Score: 4, Interesting

      The problem is that companies spend money doing R&D on this stuff, and for once it's actually real stuff they are inventing that is genuinely non-obvious and has practical uses. We all benefit if the standard can make use of the best technologies available, otherwise we would have to wait for patents to expire to get things like faster mobile internet access.

      The RAND rules are supposed to make sure that those patents are available to everyone at a reasonable cost. The issue here is that most companies just cross-licence their own patents on exchange for using the RAND ones for free, but Apple doesn't have any to licence and doesn't want to pay the (reasonable) monetary fee instead.

      All Apple has are a bunch of largely worthless design patents that can easily be worked around. It tried to buy in to the Rockstar patent abuse group but it wasn't enough.

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    3. Re:Hmm... by Anonymous Coward · · Score: 1

      It's not that there is only one way to do a task.

      It is that in order to do a task in an interoperable manner, a standards committee has to pick one way among many.
      The participants obviously want the pick to require their patents.
      To get this to happen they have to agree to license them FRAND before they get picked.
      Being picked make you patent more valuable.
      It goes from a way to do something that somebody might, in theory want to do,
      to the way to do something that everybody wants to do.

      The problem is that reasonable is in the eye of the beholder.
      Which makes the trial lawyers happy.

      I think the judge is saying that the added value is due to the picking.
      Sooo the basis for reasonable should have to do with the value of the patent before it was picked.

      The likely unintended consequence is that patent holders will be reluctant to participate directly in the standards process so they won't have to disclose their patents of agree to FRAND. (Patent trolls already likely use this strategy.) Not sure if this will be an improvement for new standards or not.

    4. Re:Hmm... by tlhIngan · · Score: 3, Informative

      Standards bodies usually try to avoid patents but this is often not practical because there are so many patents and the best solution is often patented.

      No they don't.

      A standards body works like this - industry wants to come up with a new standard for some reason - perhaps faster part, new technology whatever. So the standards body convenes a group of people from industry who then argue out the merits and the specifications of the new technology standard. Along the way, patents get hashed out - and a lot of politicking goes on in getting your patent in the standard.

      When it comes to patents and standards, you have two options - you could not offer the patent for licensing and have the standards body work around it, or you can have it become part of the standard, with the caveat that you must license to anyone and everyone as FRAND terms.

      Depending on the patent, one way may be better than the other, but in general, it's usually nicer to have people paying you so you make it FRAND. Which means at times there's a lot of back scratching to get your patent in the standard.

      Most standards are patented. Ethernet, WiFi, etc., they usually all have some form of license fee to be paid.

    5. Re:Hmm... by Anonymous Coward · · Score: 1

      There is a third option.
      Put your technology in the standard but don't tell anyone you own the patents on it. Then when everyone is implemented the standard you ask for license fees.
      This is what RAMBUS did.

    6. Re:Hmm... by TheRaven64 · · Score: 1

      There's also the fourth one: buy up failed companies that have patents in the area that the standards body is interested in, keep them quiet, review the standard but don't participate in the process, and once it's published and people have started shipping silicon then suddenly discover (to your absolute shock and surprise) that you own a few patents that (if you squint enough) look like the cover parts of the standard. Then send C&D letters to everyone to start the timer for the large damages from wilful infringement and wait for settlement offers. There's no estoppel, because you weren't involved in the standards process, and you're not governed by the RAND rules. Because you don't actually make anything, you're not in danger of countersuits.

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  5. Can't be bothered to RTFA, editors? by Anonymous Coward · · Score: 1

    The court case is between MICROSOFT and Google, not Apple and Google.

    Apple did file an amicus brief largely supporting Microsoft's position, but they're not a party to the case.

  6. Its Google versus Microsoft by Old97 · · Score: 2

    Can't the submitter at least read the article they are submitting? Moron.

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    1. Re:Its Google versus Microsoft by RubberDogBone · · Score: 2

      Can't the submitter at least read the article they are submitting? Moron.

      You must be new here.

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    2. Re:Its Google versus Microsoft by brausch · · Score: 1

      :-)

      --
      "Almost every wise saying has an opposite one, no less wise, to balance it." - George Santayana
  7. What does it all mean? by mitcheli · · Score: 1

    While I like Apple just as much as any other Mac fan and have been known to be ding as a troll when commenting on Microsoft posts, I have to ask my self one good question about all the litigation between Apple and the world. When will this litigation cross the threshold of aggressiveness and open up Apple to review by regulators as acting in a monopolistic fashion? (dread the thought! I have zero desire to run Internet Explorer on my iPhone.)

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    1. Re:What does it all mean? by Coren22 · · Score: 1

      Could Apple ever be considered a monopoly? They have around 25% of phones worldwide, and I believe it is around 5% of computers (from Wikipedia it looks like around 5% of desktop OSes).
      http://en.wikipedia.org/wiki/U...

      --
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    2. Re:What does it all mean? by jedidiah · · Score: 3, Funny

      The degree to which Apple is a monopoly in any market is dependent entirely upon the point that a particular fanboy is trying to make that day. They can either be obscure and on the ropes or they can be nearly taking over the planet. It all depends on what that day's agenda is.

      --
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    3. Re:What does it all mean? by TheRaven64 · · Score: 1

      Antitrust rules generally don't require a monopoly in pure economic terms, they require that you have a disproportionate influence on the market. This can be a much smaller market share than 100% and can relate to close ties to other parts of the supply chain as well as pure market share issues (e.g. if Apple bought enough flash that they could require that all large flash makers charge everyone else 50% more than they charge Apple, then this is the sort of thing that antitrust regulations might cover). It's also a bit fuzzy what defines a market. Are mobile phones a market, or are smartphones a separate market? Or are mobile devices (where, according to that link, Apple's market share may be as high as 66% - or as low as 11%) a market? The answer to most of these questions depends on who has the most persuasive lawyers...

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  8. FTFA by gerddie · · Score: 1

    Nokia ... [is] seeking to overturn a lower court’s ruling that found in Microsoft’s favour.

    ... and there I thought MS owned Nokia.

    1. Re:FTFA by Urkki · · Score: 1

      Nokia ... [is] seeking to overturn a lower court’s ruling that found in Microsoft’s favour.

      ... and there I thought MS owned Nokia.

      MS bought mobile phone business of Nokia. I guess you could say MS pwned Nokia by getting Elop as the CEO, but that too is in the past now and Elop is back to MS payroll (I mean, publicly).

  9. Apple and Microsoft buddies in the courtroom... by dstyle5 · · Score: 1

    Time to prepare the fallout shelter, the end is nigh.

    On a more serious note they need to something similar with software patents. Well at least the ones that aren't complete garbage.

  10. Microsoft vs Google by The+Raven · · Score: 2

    I find it interesting that nobody is disputing the validity of the patents, but only the amount you can charge for them. Both sides want patents to remain strong.

    --
    "I will trust Google to 'do no evil' until the founders no longer run it." Hello Alphabet.
  11. "standard-essential patents” by tlambert · · Score: 5, Insightful

    Any “standard-essential patents” should be public domain (or as close as possible, as Elon Musk did with the Tesla battery circuitry), or they should not be included in the standards. Period. FRAND/RAND is code for forming a club where the existing players get to play, but for which there is still a large - potentially huge) cost to join said club - and therefore an artificial barrier to entry into any existing market.

    Either make it free to license, or leave it out of the standard, please.

    1. Re:"standard-essential patents” by Anonymous Coward · · Score: 1

      The result of that will be that there are no more general standards, and once again every manufacturer is doing his own thing (since there is no longer any public spending in research, all of it is done by for-profit entities). Way to go for the benefit of the public...

    2. Re:"standard-essential patents” by Derekloffin · · Score: 3, Insightful

      That just simply wouldn't work. As another poster already pointed out, if you deny them the patent, then they have no reason to involve themselves in researching such, or standardizing. It would also simply encourage even MORE patent trolling as any patent holder can now say their patent isn't FRAND/RAND. The whole point of FRAND/RAND patents is to encourage companies to cooperate, make standards, and not patent troll each other.

    3. Re:"standard-essential patents” by Ecuador · · Score: 1

      Ok, if you give essential patents for free, won't you also have to give insignificant patents (e.g. slide to unlock) for free? I know Apple is not much related to this regardless the summary, but they, for example wanted to charge others something like $20 for insignificant design patents, when at the same time they wanted to get basic communications ones almost free...

      --
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    4. Re:"standard-essential patents” by Sloppy · · Score: 2

      You have to have pretty strong regulations for patents to even exist. In an anarchy, you're allowed to implement whatever you want, without groveling for anyone's permission. So libertarians, if they super-concerned about avoiding being conflated with anarchists, have to weigh all the evils and decide which is the least bad. But it'll definitely involve someone's liberties being infringed.

      Once possible decision as "Libertarian Tyrant" would be to point a gun at the patent holders' heads and say they're required to license against their will. My justification would be that they submitted the patented tech to the standards body, knowing that it would become a burden and risk on other parties' liberties. Doing that signals an implicit endorsement of other people using the tech, so the patent holder OPTED to sacrifice their government-granted monopoly.

      If they don't like that, then they should abstain from offering their "forbidden tech" to standards bodies, and if they learn of someone else doing it, they should be should be suing them (and possibly the standards body too) for inducing infringement.

      Another way to go, might be to just get rid of patents. There's already so much overwhelming incentive to invent things, that it's basically impossible to even prevent much less needing incentive.

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    5. Re:"standard-essential patents” by Solandri · · Score: 1

      Any âoestandard-essential patentsâ should be public domain (or as close as possible, as Elon Musk did with the Tesla battery circuitry), or they should not be included in the standards. Period.

      and from TFS:

      If Apple wins, the understanding of what fees are RAND may decrease by at least an order of magnitude.

      Are both the wishful thinking version of how things will play out.

      If RAND fees drop by an order of magnitude or are eliminated, the outcome is simple: Nobody will submit patents of any value for approval under RAND anymore.

      Those patents will be more valuable if kept proprietary and licensed out in a case-by-case basis. Remember, Apple wanted Samsung to pay them roughly $40 per device for 5 of Apple's proprietary patents, while refusing to pay Google (Motorola) and Samsung more than $1 per device for their portfolio 16 and 103 standards-essential patents respectively. If you go by those numbers, then on a per-patent basis a proprietary patent is worth roughly 300x more than a RAND patent. In other words, for it to make economic sense to submit a patent under RAND, you have to feel RAND will increase the number of devices using your patent by at least 300x.

      So any company with more than 0.3% market share will have no economic incentive to submit any of their patents worth a damn to RAND under that pricing structure. All the good patented ideas will not be submitted under RAND, and we will end up with every product using proprietary implementations. The RAND "official" standards will suck compared to the proprietary versions (unless they were created via government research). And wasteful "standards wars" like HD-DVD vs Blu-ray will become the norm instead of the exception.

    6. Re:"standard-essential patents” by tlambert · · Score: 2

      Ok, if you give essential patents for free, won't you also have to give insignificant patents (e.g. slide to unlock) for free?

      I think you are confusing de facto standards (like "slide to unlock") and de jure standards (like "RFC 793").

      The first is "I'd like to do this because everyone else is doing this, and it's neat". The second is "In order to get your device to talk to the Internet at all, you have to implement this standard".

      The term "standard-essential" in this context refers to de jure standards.

      While it might be a pain in the rear if you can not "slide to unlock", the only thing that it prohibits you from doing is having an unlock method which has been established in people's minds as a Schelling Point. You being unable to used that Schelling Point just means that you aren't going to be able to easily convert people to using your product as an easy replacement for your competitors product.

      "Reverse engineering for interoperability" does not apply to "interoperability with ingrained human habits".

    7. Re:"standard-essential patents” by MachineShedFred · · Score: 1

      Slide to Unlock is not necessary for a phone to talk to LTE towers, or send SMS messages.

      This is why there is a difference between design patents and standards essential patents.

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    8. Re:"standard-essential patents” by TheRaven64 · · Score: 1

      Because the relatively low per-device royalties from FRAND patents in a standard are usually at least one order of magnitude more than the cost of the R&D, even if you never successfully sell any products. Because if you have developed part of the technology that goes into a standard, then you have a head start in developing the final product (not to mention a marketing advantage by being able to point your customers at the fact that you invented parts of the standard). And because, if you don't get the patent into a standard, few people other than you are likely to (intentionally, at least) try to use it.

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  12. It's Microsoft vs. Google... by ndykman · · Score: 4, Interesting

    Well, to be fair, it's Microsoft vs. Motorola which was acquired by Google, which still holds the patents. Apple filed a brief in support of Microsoft. The ruling that Apple is support of upholding is that Microsoft only owed a couple of million a year for it's use of those standards in its products.

    Motorola sought an amount of four billion a year plus 20 billion in back fees. Google and Qualcomm is arguing the latest ruling was over-reaching, and that they need the ability to charge more. But, given the initial demand, it is clear they want to charge orders of magnitude more for these patents and to seek relief from previous sales. It's pennies versus dollars and that adds up.

    And frankly, Google should know better. It's benefited enormously from these technologies being available at a low cost. I know this goes against the Slashdot mindset, but Microsoft is on the right side of the argument here.

    1. Re:It's Microsoft vs. Google... by sexconker · · Score: 1

      No sane lawyer would do this, and no competent judge would allow it.

  13. FT Paywall by godel_56 · · Score: 2

    BTW, if you register with FT you can get a limited number of articles a month for free (5?), although I had to go to the front page first before it would let me look at the story.

  14. angers me by hoolaparara · · Score: 2

    This one pisses me off because these type of standards mostly do actual valuable stuff but because they aren't 'essential' we have companies that try to devalue them. These same companies sue for billions for shit like slide to unlock and a slightly less shitty version of a shitty filesystem that became the standard for removable media because of illegal monopoly behave and use them to extort millions from say android phone makers.

  15. RAND Paul by uvajed_ekil · · Score: 2

    Given that RAND stands for "Reasonable And Non-Discriminatory," is it a bit ironic ironic that Ron Paul's son is named Rand?

    I can't say yet who I'm voting for in 2016, but I can tell you one guy I'm NOT voting for. Hint: I just mentioned him.

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  16. No one is suggesting denying anyone a patent. by tlambert · · Score: 1

    That just simply wouldn't work. As another poster already pointed out, if you deny them the patent, then they have no reason to involve themselves in researching such, or standardizing.

    No one is suggesting denying anyone a patent. What's being suggested is that if something is patented, it shouldn't be part of the standard which everyone has to follow to compete *at all* in the market.

    A really good example of this is the Qualcomm CDMA patent. They did a lot of great work, behind that patent, and they deserve the patent. But you shouldn't have to implement it in order to implement a cell phone that works, and be completely locked out of building cell phones otherwise. It should not be part of the standard infrastructure.

    And, in fact, it's not. Most of the world is GSM, because they are unwilling to pay the $35 royalty per device for CDMA. And they shouldn't be required to do so, just to be able to build a cell phone. In fact, within the cellular device industry, we call this "the Qualcomm tax". Some are willing to pay the "tax", other are not; neither position prevents them from building cell phones, although the choice tends to restrict your devices to one set of carriers, or another (assuming you even have CDMA carriers in your country), unless you build a device capable of both (at which point, you pay the "tax", even if you never use the capability.