“One of the exhibits Samsung has now made public tells an interesting tale. It’s the slide presentation that Apple showed Samsung when it first tried (and failed) to get Samsung to license Apple’s patents prior to the start of litigation. While some of the numbers were earlier reported on when the exhibit was used at trial, the slides themselves provide more data – specifically on the difference between what Apple wanted Samsung to pay for Windows phones and for Android phones. The slides punch huge holes in Apple’s FRAND arguments. Apple and Microsoft complain to regulators about FRAND rates being excessive and oppressive at approximately $6 per unit, or 2.4%; but the Apple offer was not only at a much higher rate, it targeted Android in a way that seems deliberately designed to destroy its ability to compete in the marketplace.” Eagerly awaiting the 45 paragraph comment explaining how this is completely fair and not hypocritical at all. Bonus points if it includes something about Eric Schmidt being on Apple’s board, and, double bonus point if it mentions one of the QWERTY Android prototypes. Mega Epic Bonus if it somehow manages to draw a line from Edison, Tesla, to Jobs.
I’m absolutely no fan of the way Apple is throwing its weight around in the patent space, but this article seems to present a number of dubious arguments to me.
First, the discount for using a Windows OS is based on the fact the patents are already being paid for in the Windows licence. All Apple are doing is offering not to double-charge Samsung. I’m not sure it’s reasonable to claim this is a bias towards Windows over Android. It may be the incorporated cost of the patents in a Windows licence is less than the $12 Apple wants to charge for these, but since we don’t know the cost breakdown of a Windows licence, it’s impossible to know.
Second, it seems odd to suggest that because Google makes the best mapping software, it’s okay for Google to push everyone else out of the market. I’m no expert in competition law, but I’m fairly sure the argument goes something like this: if Google have a monopoly they’ll no longer have to compete, so there’ll be no reason for them to improve their services. It’s important therefore to remove barriers to competition, so that even if Google is the best, someone else can come along with a better product at any time.
I’d be happy to see an article about the validity of a capitalist approach in a free-service economy, but I’m not convinced this was really what the article was driving at.
I’m sure there were some excellent points made elsewhere in the article and I’m happy to be corrected, but these two arguments seemed to stand out as unconvincing to me.
Yeah, that part wasn’t particularly convincing. I cared about the FRAND stuff, though – I’m glad authorities are keeping close tabs on a company as large and possibly dangerous as Google.
I wouldn’t be quite so upset if I actually could see some harm from Google being #1. Google spends an enormous amount of money creating maps. Why should they not get to dominate the market. No one is stopping anyone else from spending millions to make better maps. I also see search results as an opinion. No matter how Google gets its results, they are Google’s opinion of the top results. I may rank things differently. As such, opinion is a form of speech and to be protected at all costs.
Edited 2012-10-22 14:28 UTC
But that’s exactly the point. Competition law isn’t supposed to prevent companies dominating the market. It’s to prevent them from exploiting this position and creating unfair barriers to others entering markets. If Google takes advantage of their Web search position to promote their mapping products (say), then this might be an example. If their mapping product is popular based on its own merits, then there’s nothing wrong with that.
Also, to be clear, the law isn’t just intended to protect you now: it’s to protect you in the future. Once Google has driven/bought all of the other innovative companies (by which I don’t necessarily mean Apple, Nokia or Tom Tom) out of the market, they can stop investing the millions they’ve been doing up until now.
TechGeek,
“I wouldn’t be quite so upset if I actually could see some harm from Google being #1. Google spends an enormous amount of money creating maps.”
Well, there’s no denying google’s spent money. But they did purchase some of their competitors outright. Those that I’m aware of: Endoxon, Keyhole, Where2
Yes, same here. Although Apple’s patents aren’t technically FRAND (I don’t think), the discrepancy between what they were demanding, and what they claim is fair, does seem hypocritical.
They aren’t “technically” FRAND nor are they FRAND in fairyland either.
The comparison is nonsensical, not hypocritical.
Well, I agree with the first, but the second is a matter of opinion in my view. This isn’t a legal question (Apple are perfectly within their rights to ask as much as they want). The question of whether it’s consistent for them to demand more for their essential patents than they’re willing to give for FRAND patents is dependent on whether the requirement is by virtue of them being FRAND (making it nonsensical), or them being essential (making it hypocritical).
What makes them essential? NOTHING besides some butthurt Fandroids wanting free access to them. Half of the time they will argue that overscroll bounce is useless and not worthy of copying, the other half of the time you want to describe them as ESSENTIAL?
That’s nonsense. Popular does not equal essential.
There are a number of different patents and people involved here. It wouldn’t be inconsistent for some people to think some of the patents are essential, while others are useless.
But at any rate, the claim that Apple’s patents are essential for making a full touchscreen device appears to have come from Apple (at least according to the article).
There’s no doubt Apple (and companies they’ve acquired) have made important advances in touchscreen interfaces. Personally I don’t have a problem with Apple benefiting from others using these ideas (with caveats). But I don’t think their licensing terms should be unreasonable.
No, I saw no claim by Apple that these are essential patents. I only see groklaw making up new classes of patents.
I guess it depends on what’s meant by “essential”. The slides imply that Apple patents cover: basic telephony, O/S, Object Oriented, Touch, GUI, apps, music, etc.
An “Advanced Mobile” licence (slide 8) more specifically is implied to cover:
– Multitouch user interface
– Apps and App Store
– iTunes media store and media player
– Real Web and Web services
– Advanced sensors and device context
– Service-oriented offering
Some of these look pretty essential to me. However, whether or not any or all of these are actually covered by the patents (rather than just implied by the slides) is another matter.
[Edit: fixed formatting.]
Edited 2012-10-22 17:04 UTC
I do not derive the implication that these are essential whatsoever. The only implication I derive is that Apple believes it has a broad range of patents covering a number of areas, that some in the industry are already violating some number of them, and if those companies would like to license them as a portfolio, it would cost them a pretty penny.
Valuable and/or popular is not synonymous with essential.
Groklaw is choosing to distort the picture by claiming they are de facto standards or essential. But neither view is being presented by Apple. Groklaw is making it up.
That’s fair enough, of course, but it might not be an unreasonable way to interpret the slides. For example, at the bottom of slide 8 it states that “an iPhone advanced mobile class device would require all 3 licences”. The implication is that a licence would be required (and is therefore essential).
I wasn’t impressed by the Groklaw article, and clearly there’s a lot of interpretation going on. However, since I didn’t look at the patents in detail myself, I really can’t judge whether they could be considered essential or not. I appreciate you’ve made up your mind on the matter though!
No, that is a foolish conclusion. A patent license is required to use the patent, yes. This does not make the patent essential. You aren’t defining “essential”; you are merely restating the definition of “patent.”
To me, the implication from the slide is that, in order for Samsung to sell an “iPhone advanced mobile class device”, all 3 licences would be required. If this is true, it follows that the patents are essential for such devices.
The text on the slide associates the patent licence with the device class, not the patents, so it’s easy to interpret this as more than just a restating.
But this really is just about some very narrow points of interpretation. I’m happy to accept that you read it differently, and that my interpretation may not reflect reality.
I believe Apple’s lawyers have explicitely stated that it is impossible to build a touchscreen smartphone without infringing upon Apple’s patents. Can’t find the link right now, so I might be wrong.
What makes Apples patents “essential”?
This is a good question. The article suggests Apple claims they’re essential for touchscreen devices: “Apple clearly believes you can’t make one without infringing Apple’s patents, making them de facto standards-essential in effect”.
This belief may be coming from the slides, where Apple state that a “full touchscreen device” would not receive the 20% discount a QWERTY phone receives. I don’t know whether Apple stated anything more explicitly elsewhere.
Nope, just groklaw nonsense.
So, let me guess, you were all over buying a license from Caldera… oops SCOg to protect yourself.
I see.
So, you are butthurt over your “BSD” not becoming the the dominant *NIX…
Sorry to hear that.
Nope.
First, That was not the suggestion at all. Second, Google isn’t doing anything anticompetitive against other map makers, at least not in the same way Apple and Microsoft are.
What about the vandalism to Open Streeth Maps? Google never came out with an explanation, till now, they are still “investigating” the issue.
Google is a multinational company, with thousands of employees, deals in billions and the word “Google” is probably known and used more than any other word after “God” and “sex”.
To say they engaged in some petty vandalism is laughable.
I googled
“open street map vandalism” read a few articles, interesting, no doubt they believe, and maybe rightfully so, that some Google employees were responsible for this, but it takes an impressive imagination to believe it was corporate strategy or something more coordinated than some drunk idiots.
I’m not saying anything about their ethics, just plain market strategy, Google is doing brilliantly on almost every field they play, this particular incident reeks of stupidity. Or something else.
Blah, blah blah, where is Google’s explanation?
No where, they did admit it was a contractor from them.
How does it feel to suffert the Stocolm syndrome?
Maybe they do engage in openstreetmap vandalism. But I can tell you, that if they do, they don’t do it from an IP that can be traced right back to their ass. It is an Internet-age company, they know about traceability.
Well, they were stupid enough to get caught stealing wireless information from their Google cars, and stupid enough to get caught working around the security of safary, and stupid enough to get caught not deleting the information they collected from Google cars after they say they did.
So, I see no difference here.
Apologies if I misread the article. My understanding of the accusation is that Google have been using their dominance in search to unfairly promote their other products. Whether or not Google’s other products are better is surely independent of whether Google have “cooked anything” in their search results?
If Google’s services are getting promoted due to an impartial algorithm because they happen to be the best services, then I’d hope an investigation would vindicate them.
By the way, I’m not accusing Google of doing anything anticompetitive, and I’m not saying the accusations aren’t themselves business-motivated. I really wouldn’t know!
Tell that to Skyhook.
I intensely dislike software patents and Apple’s use of them, but the Groklaw comment seems completely off base. There is no general obligation in law to license standards-essential patents on FRAND terms. The obligation to grant FRAND licenses is purely contractual, and comes only to the extent imposed by the bylaws of organisations companies join. Specifically, if a company chooses to join a standard-setting organisation, the organisation’s bylaws will impose upon it an obligation to license its patents on FRAND terms to the extent they are relevant to a standard approved by that organisation (and only to that extent). In other words, the obligation to grant FRAND licenses is a voluntarily assumed contractual obligation that companies take upon themselves because of the benefits they derive from (a) reciprocity in terms of licenses for that standard (b) the volume of licenses generated by having a patent form part of a standard. As a result, it only applies to standards the bylaws cover.
As far as Apple’s dealings with Samsung go, there is no obligation to grant a license on FRAND terms. As far as I am aware, there is no “touchscreen standard” that has been created by a standard-setting organisation (unlike the GSM standard, or the 802.11n standard). Apple (or, for that matter, Microsoft) is, therefore, legally free to be as money-gouging as it wants – unlike Motorola, which is bound by the fact that it has contractually agreed to grant FRAND licenses to Apple, Microsoft. and anyone else who asks.
That is, in terms purely of patent law. Those slides seem to me to potentially raise antitrust issues (or, in Europe, competition law issues), but it’s hard to tell without a broader context and without looking at figures. FRAND licenses, in general, help avoid competition law issues, which is another reason why companies agree to grant them. Apple seems to me to possibly be dancing close to the border of what’s permissible, but without a broader sense of what happened in the discussions – and of Apple’s corporate practices on licensing generally – it’s hard to say.
For the record, I am not a fan of Apple’s tactics (or of the ridiculously broad patents that are the rule nowadays). There is a horrible danger that this could end up becoming a zero-sum game. If companies who find themselves unable to retaliate against Apple because they’re contractually tied into FRAND terms end up turning against the FRAND system, that will spell disaster for smaller manufacturers worldwide. But that’s a different issue, unrelated to the one Groklaw raised.
You are missing the point of Groklaw’s complaint. It’s all about the amount of $$$ to be paid for said patents. While FRAND definitely defines that no one can be excluded from being granted a license, it does not define the price that should be paid.
I totally disagree with companies that use FRAND pledged patents as injunction tools, but arguing about how much who has to pay is quite normal in an industry where most other patent deals have been based on broad cross licensing + monetary terms.
Apple is the company that has issues with “sharing”, like a new whiny kid in the sandbox.
Of course FRAND affects the price that can be charged. The ‘R’ in FRAND stands for ‘reasonable’, and imposes a binding legal obligation upon to the patent holder to only charge a reasonable royalty. Or, to put it negatively, it precludes the patent holder from charging an unreasonable royalty.
Absent such an obligation, a patent holder is free to demand as unreasonable an amount as it likes. This is why Groklaw’s point is fundamentally flawed – Motorola voluntarily gave up its freedom to charge anything other than a reasonable price for its standards-essential patents when it agreed to contribute them to the relevant standard. Apple hasn’t done that, because the patents in question aren’t part of a defined standard. The fact that it (and, I add once more, Microsoft) are demanding unreasonable royalties on their patents is therefore absolutely irrelevant to the question of whether or not they can demand that others not charge them unreasonable royalties.
Reasonable does not mean that the licensee gets to choose the price. Reasonable can be a billion USD and unreasonable can be 10 USD. It’s not defined, as their FRAND commitments don’t define what is reasonable.(Remember that Apple and Nokia had exactly the same issue)
But Non Discriminatory means that the fee should be the same or at least similar for every licensee.
For 3G standard, Qualcomm and Intel have a license with all FRAND patents holders which cover their customers: the license fee is included in the price of the 3G chip.
Problem is that both Motorola and Samsung did explicitely exclude Apple when renewing their licensing contract with Qualcomm and Intel.
Can you explain how this could be non discriminatory?
EDIT: Link
http://www.fosspatents.com/2012/03/samsung-suffers-second-and-even-…
“Furthermore, the court held that Samsung cannot assert 3G/UMTS patents against the iPhone 4S due to patent exhaustion: Apple is licensed by extension since it purchases baseband chips from Qualcomm, and Samsung’s attempt to terminate its license agreement with Qualcomm as far as third-party beneficiary Apple is concerned failed because Samsung had make a commitment to ETSI, the standards body in charge of 3G, that it would grant irrevocable licenses to its 3G/UMTS-essential patents.
On those grounds, a French and an Italian court had previously denied Samsung preliminary injunctions against the iPhone 4S.”
Edited 2012-10-23 13:34 UTC
And why would I veer off to a different topic. The one that I did no bring up? This has nothing to do with discriminatory, only reasonableness.
Actually, ‘reasonable’ is a term with a very clear meaning in law – it’s chief significance is that it imposes objective limits on what a licensor can charge (i.e., a licensor cannot charge what he subjectively decides he wants to charge). There’s been quite a lot written on how it’d operate to restrict the scope of what a licensor can demand in relation to a patent subject to FRAND licensing requirements. The consensus among lawyers who work in the area is that it’d be much more restrictive than the ‘Georgia-Pacific standard’, (which is based on 15 factors, and used to assess damages for infringement in non-FRAND cases). This is because reasonableness must be judged in relation to the relative contribution and importance of the patent to the overall standard, not in the abstract, and because of the requirement that the royalty be non-discriminatory.
There isn’t any FRAND-specific case law, because never before in the history of standard-setting has any organisation sought to use FRAND patents as a weapon against a competitor. But the legal principles are nevertheless very clear. I can recommend some articles in law journals if you’re interested (and have access to a law library).
oskeladden,
“Actually, ‘reasonable’ is a term with a very clear meaning in law – it’s chief significance is that it imposes objective limits on what a licensor can charge (i.e., a licensor cannot charge what he subjectively decides he wants to charge). There’s been quite a lot written on how it’d operate to restrict the scope of what a licensor can demand in relation to a patent subject to FRAND licensing requirements.”
“I can recommend some articles in law journals if you’re interested (and have access to a law library).”
I’ve never read any legal definition of FRAND licensing. If one exists I’d highly appreciate any documentation you can provide/quote to clarify it.
Sure, I’ll do this tomorrow, when I’m back in the office.
Right! The classic paper – which represents what is clearly now the majority view – is D. Lichtman, ‘Understanding the RAND Commitment’ 47 Houston Law Review 1023 (2010). It’s also on SSRN, in case you’re interested and don’t have access to Lexis or HeinOnline – http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1783406
As you can see, the main point he makes is that a FRAND license is intended to ensure that a company cannot charge a higher royalty than the patent’s ex ante value simply because it’s become part of a standard, and that FRAND decouples the calculation of damages from the standard test. This is now the generally accepted position.
The main dissenter is Damien Geradin, of Tilburg University, who maintains that – in effect – FRAND commitments impose no real legal commitments. His views became very influential because he advised Qualcomm in their action against Nokia, but lost ground once people who understood contract law a bit better entered the debate. His argument is in effect a patent owner’s brief, which is interesting as a matter of competition law and competition economics but has no real basis in Anglo-American contract law – contract interpretation focuses on giving effect to the parties’ commercial purpose, and as Douglas Lichtman points out in his piece Geradin’s arguments leads to absurd results when seen from this perspective.
The footnotes to Lichtman’s paper give you a good review of the literature up to 2010. There’ve been a few more papers since then, but mostly from an antitrust / competition law perspective.
oskeladden,
Thank you for that research!
Well, as illogical as it seems to not negotiate on price until after an official agreement, I guess I have a better feeling for why standards bodies agree to such vague “RAND” terms in the first place. Going through the thousands of potential patents to assess license fees up front is not something the standards body can afford to waste time doing, so they say “Screw it! We’ll call them all RAND and move on.”
I guess that I’m on the same page as the author; I dislike the ambiguities with the RAND approach, but I can understand why it’s used in favor of getting bogged down in endless negotiations over what price to charge over individual bits of code.
My own opinion is if these firms themselves can’t even be bothered to read each other’s patents when building a standard, then what motivation should anyone, anywhere in the world ever have to read them either? If they had relevant technical merit in the first place, surely everyone on the standards committee would have read and understood each one of them. It reaffirms my belief that software patents have zero utility to devs who actually build stuff are mostly a means for lawyers to take profits out of software.
oskeladden, it occurs to me that you might be a patent lawyer yourself, are you? If so, no offence to you personally, I just liked the software field better before the lawyers got heavily involved
Edited 2012-10-24 14:54 UTC
Well, in a sense – ‘real’ patent lawyers tend to be scientists (or, at any rate, have degrees in science), but I did work with patents and IP generally. I haven’t been in practice for around 12 years, though – I entered academia around the turn of the century.
I was a programmer before I became a lawyer, so I understand the issues involved. My personal view is that patents aren’t really suitable for software – software needs sui generis protection, somewhat like plant varieties have. The real difficulty, though, is that it can be very hard to distinguish between software and hardware when you start thinking of embedded systems and even instructions hard-coded in printed circuit boards. That was how patent protection for coded computer instructions got started.
By itself, software patents actually wouldn’t have been a disaster (indeed, the EPO hands them out quite frequently without causing the same level of problems that the USPTO does). The real problem came from the fact that the US Supreme Court decided that patents should be allowed on ‘methods’, because those could be inventions too. The result was that patents suddenly became available on any method implemented by a computer program, with the results we see today. I’m not sure where the law will go from here, because software patents are now so entrenched that it’ll be hard to root them out, but as the ongoing litigation shows the system really is completely broken.
oskeladden,
“I was a programmer before I became a lawyer, so I understand the issues involved. My personal view is that patents aren’t really suitable for software – software needs sui generis protection, somewhat like plant varieties have.”
Probably not a bad move if you enjoy law, software’s been going downhill with all the corporate restructuring and significant offshoring. My career is hurting since few local businesses are seeking my specialised CS skills, I’ve transformed myself into more generic positions with more work, but at significantly lower wages…not to cry a river though.
“The real difficulty, though, is that it can be very hard to distinguish between software and hardware when you start thinking of embedded systems and even instructions hard-coded in printed circuit boards. That was how patent protection for coded computer instructions got started.”
Well, should “software” be patentable when it’s implemented as hardware and sold as a IC/hardware? Good question! But should software be patentable when it is being written by software developers to run on a generic processor? I think not. Isn’t that a simple & effective distinction? At least the patent situation would be pretty clear-cut for software developers who’d be free to develop software running on commodity processors.
I suppose some hardware developers will be peeved that that’d have to pay into patent licenses to use the same algorithms that software developers get to use independently…but at least then the patent debate would be pushed back to the hardware level instead of at the software level where it is today.
“…I’m not sure where the law will go from here, because software patents are now so entrenched that it’ll be hard to root them out, but as the ongoing litigation shows the system really is completely broken.”
Exactly, this situation could have been easily averted BEFORE businesses got wound up in it. But now, these patent deals are worth billions if not trillions in fees. Patent holders must be terrified at the prospect of governments nullifying software patent monopolies.
Even so, we might make a clean break from the past by ceasing the issuance of *future* software patents. There’s a good chance this would dramatically increase the value (and litigation) of existing software patents, but after a while we’d return to having normal market incentives for developers to add features to their products.
The real problem is that the federal government is not independent from the corporations that it oversees. The same players that allowed the patent system to become what it is are still at the helm today.
I fail to see where you oppose my point.
Err..
My point is that:
a) Apple is unrestricted in relation to the price it can legally charge to license its patents.
b) Motorola is subject to severe restrictions in relation to the price it can legally charge to license its patents.
The size of the royalty Apple is demanding for its patents is therefore legally irrelevant to the size of the royalty Motorola is legally entitled to demand from Apple. Groklaw’s complaint – that Apple is being inconsistent in claiming that Motorola is charging too much when it is demanding more – is therefore, in legal terms, totally incorrect. The fundamental flaw in it is that it is based on comparing a figure that is not subject to any legal restrictions with a figure that is – and the entire question is about whether the legal restrictions applicable to the latter have been complied with.
If you agree with all of this, then great – you did, however, start off claiming that Groklaw’s complaint has substance.
Edited 2012-10-23 21:52 UTC
I did no such thing. I never claimed they had legal substance.
This is hugely misleading, the Apple patents in question are not FRAND, they can charge whatever they want for them. There are many things wrong with the patent system, but this is not an example. It is not at all surprising that Apple offered an unreasonable deal, since what they really want is for Samsung to differentiate from the patents in question.
The difference between FRAND and non-FRAND is one of the things that isn’t particularly broken about the patent system. Here other issues, such as broad and obvious patents, simply make it seem problematic.
Edited 2012-10-22 14:48 UTC
It actually is a broken aspect – because it only works if the playing field is level.
So far, the mobile industry has worked on what is essentially a patent sharing scheme. The mobile phone companies would license each other patents – FRAND or not – to push the industry forward. If you had lots of valuable non-FRAND patents, you could get a discount on the FRAND patents from e.g. Nokia if you licensed those non-FRAND patents back to Nokia.
Up until Apple joined the industry, this worked fine. However, Apple had no interest in this reciprocal system, and instead, profited massively off FRAND patents – without signing license agreements, I might add, they just took them – while refusing to give back its own patents, while AT THE SAME TIME demanding the same treatment as other companies that DID share their patents.
This is CLEARLY not in the spirit of what the FRAND licensing system in the industry had been about up until that point. We now see the system budging and crumbling, because suddenly, crappy software and design patents are now infinitely more valuable than cold and hard FRAND hardware patents – patents for a standard that took massive amounts of time, investment and work to design, implement, and spread across the globe. The effort it took to get GSM, 3G, and associated technology working is of such an immense magnitude it’s hard to fathom. Bouncy scrolling and rounded corners fall into more than insignificance here.
There would be no mobile phone – smart of not – without Motorola and Nokia. We’d still have phones – feature and smart – without Apple. Yet, it’s Apple’s patents that are worth the most. Do you see how unfair that is?
So no, the FRAND system is no longer working – because a new player decided to misbehave itself.
Edited 2012-10-22 15:05 UTC
Do you even have the slightest shred of evidence that “everyone prior to Apple” willingly provided reciprical licensing to non-FRAND patents in exchange for FRAND patents, or do you not even mind just making crap up now?
(Last I checked: this started with an Apple and Nokia dispute that was resolved amicably with Apple resolving to pay for FRAND patents at a reasonable rate with no reciprical licensing of non-FRAND patents. And it’s only Google and Samsung demanding absurd rates on FRAND patents.)
And, even if you had any evidence of such behavior, this is still a violation of FRAND: FRAND Standard Essential Patents should not be used as levers to gain access to other IP. Ultimately, this butts up against non-discriminatory (i.e. companies with useful IP get FRAND patents cheap; companies without useful IP pay more for FRAND patents than others).
Edited 2012-10-22 15:41 UTC
Most patents licensing deals are secrets, so it is impossible to find such proof. But it sounds likely, since most lawsuit seems to involve Apple with an “old” manufacturer (Samsung, Motorola, HTC…), and no in-fighting between those manufacturers.
A spokesman for Apple said: “Apple and Nokia have agreed to drop all of our current lawsuits and enter into a licence covering some of each other’s patents, but not the majority of the innovations that make the iPhone unique.” (source: http://www.guardian.co.uk/technology/2011/jun/14/apple-nokia-patent…)
It does hint that Nokia got a license for some of Apple patents.
Where does it says that FRAND should not be used to gain access to other IP ? It says you can ask for a “Reasonable” payment, cross licensing non-FRAND with FRAND might be considered as “Reasonable” payment. And apparently, in case of Nokia, Apple thought it was.
If I recall correctly, the Apple/Nokia case got settled after Microsoft took an interest in the company. Apple and Microsoft are very close partners, so that most likely played a key role.
Rubbish. All companies do everything they do so as to succeed in business – i.e. make money. Companies can have all sorts of different business models and do all sort of things in particular ways to suit their business model but their business model is designed to do one thing: succeed in business. None are concerned with ‘pushing the industry forward’ except as a by product of making more money. If they could slow the industry down and make money they would.
The reason that companies such as Samsung or Motorola or Nokia have offered FRAND patents in the past was to make money. It was based on a calculation that showed that going the FRAND route made more money than not going the FRAND route. The basis of those calculations was the low innovation rate business model that prevailed in the handset market before the disruption of the iPhone which caused a rupture with previous market conditions. In the new post-iPhone market conditions offering patented technology within a FRAND framework makes less financial sense, hence companies have slowed FRAND offerings and attempts to agree new FRAND agreements (micro-sim etc) are very fraught.
The old smart phone market conditions were relatively kind to lesser performing companies. The new smart phone market is lethal to lesser performing companies. Currently only two companies have working business models that ensure profitability and scale, and hence survival, in the new global smart phone market, that is Samsung and Apple. All other companies are struggling (with the possible exception of some companies currently restricted to the Chinese market) and almost none will survive in the market.
In this context the struggle between Samsung and Apple will be intense and fought on many fronts. Neither will offer the other anything other than painful licensing terms, both will screw the other for every dollar and every drop of blood, neither are interested in FRAND much anymore. Apple is busy severing every dependency it has on Samsung in it’s supply chain and severing every link it can to Google’s service stack so it can reduce it’s vulnerabilities, it will have completed that process within a couple of years at most.
The previous reordering of the handset and device market post iPhone was only stage one of the disruption, we seem to be entering a new period now where players such as Microsoft and Google and Amazon realise that they have to mimic Apple’s business model of making and selling families of integrated devices with integrated eco-systems in order to survive in the modern smart device global market. They won’t all succeed. Samsung looks like an odd one out here because it has not, yet, gone with an integrated device service stack model and has continued to ride Google’s service stack. That may well change. The relationship between Google and Samsung will be one of the most interesting to watch in the next few years as we discover which is the tail and which is the dog.
The bottom line – software patents must die. Or money hungry companies will just stall the industry with their idiotic wars.
What is so absurd about apocalyptic comments like this is that in the last five years we have had incredibly fast innovation and much greater patent litigation. So the idea that the scale of litigation will slow innovation is simplistic and disproved by the actual course of events.
All industries and markets undergoing a period of intense disruption caused by paradigm shifting innovation have seen an accompanying wave of intense IP litigation. The litigation waves have all faded, as will this one.
Try to stay calm and carry on, the end of the world is not nigh (except for some big tech companies).
incredibly fast innovation and much greater patent litigation
We had fast innovation in spite of greater patent litigation (which only continues to rise). I.e. the innovation could be even faster. There is no point to even argue about that – the damage of software patents to the progress of technology is self obvious.
Yes that is true. We have to note, however, that unlike other industries it’s the challenger that is going after the established players. That is not the usual for disruptive innovation… Usually the established players point the patent guns at the newcomers. Here, Apple has pointed the guns at established players(for all the right and all the wrong reasons).
You want to know what’s apocalyptic? The fact that Apple has ushered in the era where sitting at your computer and writing your own code can get you sued the shit out of by their laywers. Even if its your own code that is completely different than theirs. Totally different code and Apple can just come along and say “your code violates one of our zillions of patents you cannot distribute your code.” “All your code are belong to us” Fuck Apple.. Will not recommend any of their products to anyone going forward until they stop this bullshit. Nor will I purchase anymore of their products until they stopit. screwem.
I’m pretty sure that Apple is doing exactly that right now.
Actually that is exactly what Nokia, Samsung and Motorola were doing with they’re lame ass feature phones a bit more than 5 years ago. Incremental and minuscule hardware updates such as a slightly better camera, or adding radio or whatever.
Until Apple came along with the iPhone (which they initially made fun of).
Edited 2012-10-22 17:04 UTC
Apple has the right and should protect things that make their device stand out. However, they have taken a lot of steps that do not defend the most definitive elements of the iPhone; in addition to the one’s that do defend the elements that make iPhone an iPhone.
One example is the broadening of swipe to unlock patent. Specifically because most of those patents are implemented in WP7/WP8/Win8, this ceased to be the defining patent for the iPhone. Demanding $40(or whatever they were demanding) for swipe to unlock, tap to zoom and rubber banding is a “robbery”.
Please don’t be childlike because the entities you are talking about, gigantic corporations whose businesses are counted in the tens and hundred’s of billions of dollars, are very far from childlike. Childlike companies don’t grow that big.
Charging a license fee is not robbery it is a business. If you have the ownership of something that someone else wants to license you can charge what you want or you can decline to even offer the possibility of a license. It’s your choice, it’s your property. You can be challenged as to the validity of your claim to ownership but if the courts decide you do indeed own the thing then you are free to dispose of it however you want and at whatever price you choose and the market can bear. That’s just how the world works, and has always worked.
Some companies, Motorola are a good example, voluntarily entered into binding agreements that governed and limited the way they could license some of their property. They did that completely voluntarily and because at the time it seemed in their best interest to do so. Circumstances changed and now it is not in their best interest to abide by the agreements they signed but that’s just unfortunate for them. Once you sign up to a legal commitment you are committed.
When people whine about how “Apple’s offer was not only at a much higher rate, it targeted Android in a way that seems deliberately designed to destroy its ability to compete in the marketplace” what the fuck do you expect? That Apple would go about things in a way that would facilitate their competitors to better compete with them? What company, especially any big successful company, ever does that?
This endless regurgitating of the same old litany of complaints about how big bad Apple is gunning for Android are just stunning in their naivety. There is possibly a trillion dollars at stake here. This is a game for the fully adult. It’s not going to be a tea party. There will be blood.
You say what giant successful company?
Hmm I don’t see Google suing Microsoft for Bing? I don’t see Google suing ANYONE over products that compete with them. Filing for patents of trivial software features that has been around in other iterations and suing world+dog over trivial software features is a farce. I do not support that behavior in the marketplace and will work to inform anyone who needs tech advice to stay far from Apple’s products until the quit abusing the patent system.
You mean other than all the multiple legal actions being undertaken, most based on FRAND abuse, that are being conducted by Google’s Motorola division?
Good luck with that campaign.
Tony Swash,
Don’t be pretentious. Patents were *supposed* to promote inventions which would not have otherwise been viable to develop without patents, yet I somehow doubt there’s a single patent in apple’s “FRAND” portfolio that you could claim this to be the case for. Apple are as guilty as everyone else in abusing the patent system and intentionally using it as a weapon to harm competitors. They *all* deserve to share the blame for the patent mess we’re finding ourselves in.
Fanboys need to quite playing favouritism. While individual cases will be won and lost, everyone should recognise that we *all* loose in the long run because the costs of all this BS gets passed on to consumers as either higher prices or lost features. These lawsuits today have squat to do with innovation.
I don’t expect anything other from Apple, Microsoft or even Google. That does not change the fact that Apple is actively abusing USPTO process of continuations to broaden swipe to unlock patent.
Since you are defending patent owners(Apple) so adamantly, you must agree with Lodsys that app devs have to pay up. That patent is not invalidated and is not FRAND’ed.
Yeah, “childlike” barely starts to describe it…
http://en.wikipedia.org/wiki/The_Corporation_(film)
Edited 2012-10-30 00:01 UTC
Without signing a license agreement for FRAND patents? That is nonsense: there are thousands of FRAND patents in the 3G standard alone and probably as much in the WiFi, Bluetooth and other standards. Yet Apple has only problems with Samsung and Motorola because they excluded Apple from the usual way of licensing FRAND patents which is as a part of the price of the standard chip (Qualcomm or Intel for 3G).
Only thing Apple invented was its company logo, it is impossible that a company entering the mobile market 5 years ago could have invented critical parts of the system over companies doing this for more than 20 years.
The iPhone and iPad are nothing more than the marriage between a PDA and a phone, all features having existed in each are prior art.
And or bouncing into oblivion
US patent office kills off Apple’s bounce-back patent
http://www.theregister.co.uk/2012/10/23/uspto_apple_patent/
beat me to it. great news huh. i reckon. (not anti apple just anti stupid obvious patent).
(should ask at least 10 clever people how they’d implement a solution to a problem, if nobody on said random panel even overlaps with the proposed solution, then patent office can fairly award the patent, otherwise it’s should be allowed pass – that’s my tuppence, if we should have patents at all!)
Super triple bonus if Thom’s next post is somehow related to Google, where it praises them in some way or another while dissing Apple and at the same time linking to Groklaw.
Edited 2012-10-22 15:00 UTC
I think you’re proving the point of the article.
That Thom has single-handedly become the most massive troll on this site?
In this thread, Thom shows he has absolutely zero understanding of the patent system. None. Nada.
Hell, same goes to most commenters on OSNews. Look no further than the Apple trial articles to see how many people said that Samsung would win and how the people who suggested Apple would win got buried into oblivion.
Apple does not have to license their non FRAND patent in a fair, reasonable, and non discriminatory fashion. They don’t. They can charge infinity billion dollars for their patent, or they can refuse a license altogether.
Again, to repeat my familiar phrase: Only in OSNews bizarre land is this alarming in the slightest. Only in the invented reality of some commentators here is down up, and up down.
When Apple agrees to the governing rules of a standard setting committee to license intellectual property on FRAND terms, then there will be an article.
Of course, OSNews is entirely quiet on Microsoft locking Google out of Germany with patent wins against Motorola.
In the bizarre land of not-the-USA many of our institutions of law also seem to find this alarming when applied to software patents.
Okay. That’s fine. This is an article pertaining to a case in the United States. I’m having trouble figuring out the point of your comment.
The article is, but your comment also refers more generally to the state of discussion on OSNews relating to patents. Regarding that, I was stating that its not just a rump of techie enthusiasts of this site that hold the views you roundly condemn, so perhaps they shouldn’t be dismissed.
Oh, nice tautology!
Question is does some Apple patents are enough essentials that competitors can’t avoid them to compete with Apple on some marketfield?
Apple’s own lawyers are answering this in these slides:
– slide 4 : “Operating system, applications, user interface, and services are the key to a differentiated customer experience”
– slide #6 : “Mobile Computers rely upon several key technologies principally developed in the computing industry […] Touch interface / gesture recognition”
– slide #7 : “Advanced iPhone Technologies needed to create an *advanced* class device (e.g. Touch, GUI, apps, music, etc.)”
– slide #8 : “Apple’s iPod and iPhone innovations have defined the standard for modern high-end consumer devices”
– slide #16 : “non-touch device – 20% discount”
– slide #17 : “Full touch screen device – No discount”
It appears there quite clearly that, from all examples given, the key, the standard defining, the needed technology that trigger a distinctive rate is full touch screen device.
The only logical conclusion here is Apple consider that for making a touch screen device one MUST license their patent.
And by their own claim, Apple has defined a standard for high-end customer devices with iPod and iPhone, two devices with features a touch screen.
I really failed to understand how that’s not making automatically touch screen patent falling under FRAND policy. Except if one accept that Apple is free to block every competitor to access high-end customer devices by asking unfair, unraisonable and/or discriminatory license rates (see: no tautology here…).
Avoid this kind of abuse is the main reason FRAND exists in the first place.
And if touch screen interface is essential to make a advanced mobile device, aka FRAND, then why Apple asked $30 when they found $6 too much for as much essential FRAND license to access advanced mobile networks like 3G/4G!?
What justify these $24 difference per unit!?
How an user interface technology making user experience more friendly can worth more than a mobile network technology making a mobile device being, well, mobile in the first place!?!
If a technology required to have a 3G mobile device worth no more $6 per unit, a technology required to have a touch user interface on that same 3G mobile device can’t worth more, simply because without the former you don’t have any salepoint for the later…
When I read “iPhone advanced mobile class device,” I read a device including specific patents that are exclusive to the iPhone, not any and all touchscreen-based devices.
From there, you are just describing patents. Yes, patents grant exclusive rights to the owner. If you don’t own the patent, you may be able to license the patent from the owner or you can avoid using technologies which infringe on the patent.
This absurd and unsupported notion that Apple is demanding patent licensing on any and all touchscreens is easily disproven. Even amongst all of its litigation, not everyone is being sued for touchscreen-related patents. When touchscreen patents have been involved, they have been clearly quite specific, not general (i.e. using a different gesture to scroll an iframe within another scrollable region, or the zooming-centering behavior of double-click to zoom, etc.)
The only thing that falls under FRAND policy are international standards that contractually require FRAND policies. What international standard is there for touchscreens, and when did Apple submit their patents to be governed by FRAND terms?
Just because these patents may be desirable, this does not mean they are essential or that Apple should be compelled to do so (there certainly is no law or contractual obligation that requires this).
Edited 2012-10-22 18:53 UTC
The re-read the slides. It’s perfectly clear there that NOT having a full touch screen is one criteria that trigger one discount: it’s given multiple times as an example (when you read “Ex:” what do you read instead?).
Second, I also think that Apple patents aren’t actually that essentials to make a full touch screen mobile device. Several suits show that these patents were not infringing by competitor as Apple’s lawyers were claiming, making them, indeed, not absolutly essential ones.
But these slides clearly present the exact contrary: the rate is clearly presented as 20% higher on the sole basis that the device is full touch screen one. It’s in several slides. That claim was clearly used to increase the license rate per unit for any touch smartphone sold by Samsung on the sole point that it’s a full touch screen device.
Also, can anyone give a list of “Apple licensed processor”?
A5 ? How one can have that 20% discount in the first place?!
I personnaly found slide #12 the most telling one: it’s written black on white that :
– the full rate, $30 per smartphone, applied to “touchscreen devices based on” Android, Symbian, Bada (except for non touchscreen, aka physical keyboard form factor).
– the full rate for touchsceen devices based on “Windows, others” must be discussed.
Why this distinction? Let’s consider that’s due to the already-licensed OS discount. Which OS fall there, actually?
Windows Phone, okay. What else? iOS is not an option here, as it’s not available for OEM licensing.
So, what’s the “others” choice here?
I find zero logic in this post, sorry. Unclear how you’d like me to respond.
Yes, if your device doesn’t include a full touchscreen, the patent portfolio is discounted. If you are using Windows or some other technology that may have a sublicense to some of the patents, you may receive a discount. I don’t see any logic in claiming that these discount statements means that any and all touchscreen devices utilize Apple patents.
Edited 2012-10-22 19:55 UTC
Now that’s me who don’t see any logic in your!
If you doesn’t include a full touchscreen, Apple agree to discount his “smartphone license” rate, but it doesn’t mean that when you do, the fact that such discount is no more applicable anymore doesn’t mean that Apple consider that all touchscreen mobile devices are using inevitably some of their patents on this area?
I will agree that patent and logic are not necessarily living in the same space, but your seems too as well…
Is that supposed to be one sentence? Is it supposed to make sense?
English not being my native language, I really can’t answer that.
Let’s try shorter:
a) full touchscreen device = discount on apple patents license
b) not full touchscreen device = no discount on apple patents license
By which logic you could conclude Apple is NOT claiming no touchscreen device is possible without licensing their patent!?
Which, BTW, was proved false in several european suits, which ruled that Android’s multitouch features were not infringing the Apple’s patents that Apple’s lawyers were throwing it the suits.
Hence an alternative question: if Apple’s multitouch patents are not that essential that somes judges find that Android multitouch don’t infringe them, why Apple consider that the simple fact that an unit sports a full touch screen device make the %20 discount disapear!? If it’s not essential, there is no point to put *all* full touch devices falling under their touch patents. If it’s essential, there is no way for every full touch devices to fall under them, making them FRAND ones.
Apple can’t have them both ways.
The simple answer is: Apple doesn’t claim that it is either way.
You are continuing to foist your misinformed understanding of what essential is upon Apple and then making bad arguments from that initial bad premise.
That is not the question at all, but it is at the center of many people here misunderstanding.
If Apple has patents that competitors need in order to successfully compete, they can either pay what Apple asks or they can not compete. There is no law that requires they give access to other competitors so they can successfully compete with Apple.
*Successfully*, of course not.
But could try, I really think there is.
Otherwise, Apple could just ask $100 billions per unit for touchscreen patents and rule the touchscreen devices marketfield until the world’s ending.
Touchscreen is presented as an unavoidable technology increasing the smartphone license rate in quite every slides here. It’s clearly an attempt to raise 20% the enter price in hope that would make the Windows Phone 40% discount more interesting for Samsung.
The target in these slides is not Samsung.
It’s Android. It’s written everywhere : drop Android.
Without any proof that Android actually infring Apple patents beside the usual “it use our technologies”.
No wonder Samsung don’t buy it.
If Apple was not that hangry, asking for a $5-10 rate, maybe they would have.
Instead, they reject it and goes full straight. They may lost in suits, but they win far more in marketshare.
Wait, what?
FRAND patents relate to standards, a standard being something that is set by an organization (such as the ISO or ITU).
Saying that Apple has defined a “standard” is NOT at all the same thing as a standard such as 3G technologies.
You cannot use the same word (standard) with two totally different meanings (required to conform to a specification -vs- what consumers expect) and then try to claim they are the same sort of thing.
Apple may hold patents to technologies that people expect to be implemented in products for them to be marketable, but that is not the same thing as saying that the IP is required for companies to make a product that can work with a specification.
Apple is perfectly within its rights to not license their IP at all, or under whatever terms they choose. FRAND patents have specific obligations that they must confirm to.
Simply change the rules at the standards level. If you want your IP to be part of a standard then you must assign the rights over to the standards body. The standards body allows anyone who implements the standard to have royalty free access to the patent. Structure it in such a way that if the IP is being used outside of implementing the standard that the original company gets to negotiate as with any other patent.
The idea of standards essential patents is, simply put, stupid. No company should have to pay another company anything to implement a standard.
Standards are built on existing technologies which are often already patented. It would not be possible to define a standard without using any patented technology.
Then, I don’t see a problem with FRAND patents until someone try to abuse the system to force a newcomer to cross license their own non-FRAND patents.
Which is exactly what Nokia, Samsung and Motorola tried to do.
Nokia did it more or less fairly in the sense they didn’t ask for an injunction.
At that time, any newcomer would have had no choice but accepting. Apple was however big enough and had such a winner product with the iPhone that they were able to refuse to cross-license their non-FRAND patents.
FRAND patents when misused allow the historical actors to dictate their law to any newcomer without such a portfolio: this is exactly what Thom seems to prefer. A time when mobile corporations ruled the mobile industry.
I think this is something that everyone has missed.
20% discount is for “Apple licenced processors”.
Now unless Samsung decided to give up its own Arm based Exynos business, it would be paying 20% of $30 or $40 to apple for every product. Not infringing product, but every product.
Usually, I am against software patents. First and foremost, because I see them causing more harms than good. On a fast paced industry that extend its tentacles to virtually all human activities today, it is, at minimum, counter productive to give to any player a right to block others from be also players.
User interactions should NEVER, EVER, QUALIFY for patents!. They constitute a language! These define-meaning, take-order things like one-click buy, slide-to-unlock and all gestures are components of LANGUAGE by all standards. Bum! Magically 9x % of all these frivolous lawsuits are kaput! Other elements of user interfaces are already covered enough by design protections and copyright. This also would give to examiners of USPTO more time to do their job and look for prior art. Also, the main loophole would be closed to free ride from suckers to abuse the law system.
Last, even though I said that I am against software patents I do see them as valid on many cases. Lets take for example the infamous *FAT* case. On its complexity, it is no different to project a machine, one that takes bytes and arrange them on a convenient way. What the law should contemplate is to make illegal to block any initiative to get things from one format and put it on another. The implication should be the following on *FAT* case: it would be legal to read a *FAT* file system, but not to read and write, on the last case, you would be obligated to buy a license. Also, there should be an automatic threshold on market usage, get over 50% and it is not FRAND or get over 90%, you already got the rewards for your invention, no more fees on that for you. Guess what? People would start very fast to think about using FRAND terms to avoid the multitude of converters from mp3, h264, quicktime and all others private formats that exist today. One more nail on bad practices coffin.
OBS.: forgive me if someone already said that here, I am kind of busy and do not have the time today to take a look on them all.