Microsoft Strong-Arms Another Android Licensing Deal

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News Posted: Mon, Jun 27 2011 11:06 PM

Microsoft announced on Monday that it had convinced yet another company to sign a licensing deal to cover Android wares. General Dynamics Itronix will be paying the folks in Redmond an undisclosed sum to ensure "broad coverage" of Microsoft's patent portfolio for future Android devices the company wants to create.

General Dynamics Itronix makes ruggedized notebooks, netbooks and even a tablet, using mostly Windows software.  But clearly it is eying the ultra-hot Android market for new products.

This is, arguably, Microsoft's third publicized Android licensing deal. The biggest was the HTC deal, signed in April, 2010. The first was, perhaps, a deal with Amazon in February, 2010. Amazon agreed to pay Microsoft royalties to cover a range of Microsoft intellectual property, including, some speculated, the use of Android on Amazon's Kindle. The deal also covered Amazon's use of Linux on its servers.

Linux and its derivative, Android, seems to be turning into a profitable business for Microsoft. A recent analyst report indicated that Microsoft is making a handsome $5 per HTC Android device sold. And that means it is raking in far more money on Android than it is on Windows Phone 7 (which reportedly costs about $15 per device license). However, the idea here isn't really to make a killing on Android, which is nice for Microsoft and all. The idea is to keep Android from being a free alternative for device makers. Microsoft CEO Steve Ballmer said so to the Wall Street Journal in October.

By the way, these aren't the only licensing deals that Microsoft has pulled off regarding Linux. In addition to the Amazon deal, Microsoft scored an early Linux cross-licensing agreement with LG Electronics and a few others, such as a deal with TurboLinux.

Meanwhile, Microsoft has launched lawsuits against Motorola and Barnes & Nobile to try and collect royalties from their use of Android, too.

Until Linux and Android, it was rather rare for Microsoft to initiate a lawsuit over IP infringement. Microsoft was previously more often the deep-pocketed victim of such suits, not the instigator. About a year ago, when the company sued in May, 2010, Microsoft had only filed four patent infringement lawsuits including that one in its entire hitsory. ( and Microsoft eventually settled).

But hey, Microsoft seems to be changing its mind. If you are the world's largest software maker sitting on a boatload of cash and you can't beat 'em, you can at least try to profit from them.

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omegadraco replied on Tue, Jun 28 2011 10:41 AM

$5 per HTC Android device turns into an incredible amount of money. Plus at $15 for WP7 versus $5 for Android device makers are still going to go with the cheaper alternative unless WP7 turns into some kind of powerhouse.

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RTietjens replied on Tue, Jun 28 2011 11:31 AM

The USPTO is the single most-effective bottleneck to innovation and progress; they have repeatedly proven that they will grant a patent for anything, prior art or obviousness notwithstanding, as long as the forms are filled in and the payment made.

Software patents are dooming American innovators. Might as well give up and go work in China; at least there, the Government tells patent trolls where they can shove their patents.

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acarzt replied on Tue, Jun 28 2011 12:00 PM

Wait what? Someone please explain to me how Microsoft managed this one?

How is Microsoft collecting royalties on devices running linux or android???? Microsoft did not create either...

Wth?? That just sounds straight up crooked.

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DaveAlun replied on Tue, Jun 28 2011 3:00 PM

MS' claims have NOTHING to do with actual IP ownership, they have everything to do with a CEO avoiding getting his/her company into a hugely costly lawsuit.

If you were a CEO you'd pay up the $5 per device - and pass the cost to your customer - rather than face billions in legal costs.

In my opinion it's just legalised corporate blackmail. And there's a court in East Texas that would probably enforce the claim, even if it were totally bogus.

Pretty sad state of affairs.

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HHGrrl replied on Tue, Jun 28 2011 3:28 PM

I missed something here. Why does Microsoft get to collect royalties on devices running linux or android?

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AKwyn replied on Tue, Jun 28 2011 6:19 PM

This is really confusing???

They don't even own bits of linux nor portions of android software.

I suspect they're trying to gain patents on the hardware front rather then the software front.


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DaveAlun replied on Tue, Jun 28 2011 10:48 PM

MS don't need to own anything.

All they have to do is threaten a very, very expensive court case and they get license fees. It has nothing to do with ownership - everything to do having the biggest legal department.

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gdubaus replied on Wed, Jun 29 2011 12:06 PM

1. System provided child window controls: 5,889,522

2. Remote retrieval and display management of electronic document with incorporated images: 5,778,372

3. Loading status in a hypermedia browser having a limited available display area: 6,339,780

4. Selection handles in editing electronic documents: 6,891,551

5. Method and apparatus for capturing and rendering annotations for non-modifiable electronic content: 6,957,233

These are common functions and no - they do not have to be created by the patent holder - only registered by them as their ideas.

Patent Harvesting is a seemingly unscrupulous part of the business, but it does have its place.

What I find particularly interesting is the strategy to pick off the smaller companies in an effort to validate their patents and eventually go after Google?

What will typically happen in cases such as this - is a huge IP licensing swap agreement... so watch those that are being sued to either cough up the cash or strangely start exchanging their IP for MSFT claimed IP in some way...

Go back and look at a company called Visto that holds the patent for store and forward messaging... talk about patent trolls....

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3vi1 replied on Fri, Jul 1 2011 10:04 PM

Having not started with a monopoly position, and being unable to buy the competition, Microsoft can't compete. It's the same story as with the Zune or Bing.

Suing companies for not using MS tech is now their standard operating procedure:

All it does is stifle innovation and raise cost to us consumers while making some lawyers who produce nothing very rich. Software patents need to be eliminated (and I say that as a programmer).

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?


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