The Sharks Are Circling: Microsoft, Oracle Target Android Manufacturers

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News Posted: Sat, Jul 9 2011 5:02 PM
Android's rise to dominance as a smartphone/tablet OS has reshaped the mobile OS market--but recent actions by both Microsoft and Oracle could damage the operating system's appeal. Oracle and Google are locked in an ongoing lawsuit over Android's alleged infringement on certain Java-related patents, while both Oracle and Microsoft are negotiating licensing agreements with Android device manufacturers.

While this is an ongoing situation, pressure has mounted in recent weeks.  Last week, news broke that Microsoft has demanded Samsung pay it $15 per Android device. The deal is similar to one the software giant reached with HTC last year; that handset manufacturer pays Microsoft $5 per Android product. Microsoft has signed similar deals, albeit with smaller companies and for undisclosed sums of money. These agreements are only the most recent developments in what's been a litigious year; Redmond is currently suing both Barnes & Noble and Motorola over their own Android products as well.

Oracle, meanwhile, has done an end run around Google and has raised the issue to handset manufacturers directly. At this point, the conversation is reportedly friendly—Oracle has allegedly asked manufacturers to pay $15-$20 to join an early adopters' program—but the database giant is known for playing hardball. The company's lawsuit, filed in August 2010, seeks damages totaling $2.6 billion and requests an injunction preventing further development or shipment of the Android operating system.


Android has been chomping into overall OS market share for a year. Original graph courtesy of Nielsen

Google itself is partly responsible for the manufacturers' woes. By giving Android away, Google avoids the need to offer any sort of patent infringement indemnification. In this context, an indemnification agreement is a legally binding contract in which Google would agree to pay any patent infringement costs incurred by an Android licensee. These sorts of agreements are standard operating procedure in the IT industry. Given the nature of the US patent system, and the years it can take to settle patent disputes, such indemnities are a virtual necessity.

The various companies squaring off against Google/Android (we've covered Apple/HTC separately) have different motivations and target very different aspects of the operating system. Oracle's lawsuit is essentially an attempt to monetize IP it acquired when it purchased Sun, while Microsoft's lawsuit allows the company to negotiate for access to patents it wants, "encourage" manufacturers to develop for Windows Phone 7, and offers a potential revenue stream. Apple's lawsuits against HTC and Sprint, meanwhile, focus on both physical device design and GUI/software implementations. The three companies scarcely offer a united front.

Device manufacturers may find this fractured offense to be of little comfort. If Oracle, Microsoft, and Apple continue to wring per-device settlements out of the industry, Google's 'free' operating system is going to acquire a substantial price tag. Once the tactic has been proven to work, we can expect a virtual dogpile. Long term, Google may be forced to actually license Android in a way that provides a degree of patent indemnification.
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Sam2can replied on Sat, Jul 9 2011 11:48 PM

I have an android handset and a blackberry. I have previously had microsoft 6.5. I use open office. I will never buy apple because they don't use flash. I am upset about what is going on here and am hoping that Google change these problems so they don't get any more money. Google is an innovative company and they can be better than Microsoft, Apple etc. I like Google the best because they give away everything for free. Whereas Microsoft and Apple well lets say if Google wasn't here it would be a different story. As they control the prices and they have become the market leader. They bring both Microsoft and Apple down in their prices. And I feel more people should support them.

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3vi1 replied on Sun, Jul 10 2011 12:45 AM

As I understand it, the Oracle patents are junk. Sun filed them as defensive measures (never enforced them), and they overlap with basic preexisting Unix functionality.

I expect Google will sue Microsoft soon, to force them to reveal the patents they're using to threaten the handset manufacturers. Microsoft is abusing the system by forcing the other parties not to reveal the patents in question as parts of their settlement - preventing anyone else from contesting the patents or changing their functionality so that they no longer infringe.

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

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realneil replied on Sun, Jul 10 2011 12:47 AM

The greedy bastids should have spoken up before there was such a huge adaptation of Android. They waited just to make a bigger payday for themselves now. MS and Oracle should have their ears pinned back for the way they handled themselves in this matter.

Dogs are great judges of character, and if your dog doesn't like somebody being around, you shouldn't trust them.

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JWalson replied on Sun, Jul 10 2011 1:15 AM

The main reason manufactures starting creating Android devices in large numbers was to get around the cost of paying for a license to Apple, Microsoft, Rim and Nokia. By using Android they did not have to pay for Research and Development. It was free to them. All they had to do was download the software and sell it for profit. Now they are finding out Software is not free. There always was a cost. It was a substantial cost that will be paid out to multiple companies. The Profit margin they thought was there never was. Why do you think Microsoft invest so much more in research and development. The profit margins will be very small in the future for selling Android devices. Then you have Apple who mignt not care about licensing anything. How is a manufacturer going to get around that. Oh yeah and you have Oracle who owns java which is what Android is built upon. They are not getting paid either. Now think Google is not making much money for giving away Android for free. I don't see much incentive to keep putting that much effort into it. They should move on to the next big thing and really innovate not copy, there is no money in it.

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Poor babies dont want to compete fairly!

If you cant beat your competition fairly then why not stick your head up your own butt and eat your own product:P

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3vi1 replied on Sun, Jul 10 2011 9:26 PM

>> Now they are finding out Software is not free.

Citation, please. There is tons of free software. How much do you have to pay if you decide to use Gimp for your personal photo editing instead of PhotoShop? How much do you pay to edit audio files with Audacity? How much do the majority of sites on the Internet pay to run Apache instead of IIS?

>> you have Oracle who owns java which is what Android is built upon

Oracle did not invent Java, Sun did.  And they open-sourced it for the rest of the world to use.  Google's java is a complete re-implementation, so don't act like they owe Oracle anything.  The things Oracle's suing for don't even have anything to do with the standard operation of Java apps.

>> Why do you think Microsoft invest so much more in research and development.

And what do they have to show for it? Windows Mobile 7? Maybe that new version of Vista with bigger icons?

>> They should move on to the next big thing and really innovate not copy.

Like Microsoft does? I just cannot understand why Microsoft has so many fans... maybe people are afraid that if something else gets popular, they won't be considered 'experts' because they only know Windows?  If you want to be a computer 'expert', you need to know a hell of a lot more than where Microsoft hid certain registry keys.  Let me tell you a little about Microsoft's innovative products...

MSDOS: A copy of CP/M (look it up, it copied the APIs) created by Tim Paterson, who MS royally screwed over. They had him do all the work for $75,000, and they reaped all the reward of the billion dollar monopoly his product gave them.

Windows: Not the first... not the second... but seventh windowed OS available to consumers. Only successful due to underhanded MS tactics and existing MSDOS entrenchment. The X system from Unixy OSes like Linux predates it.  The early versions of Windows also retroactively enforced the DOS monopoly - I'm talking underhanded AARD code type stuff.

Office: Copies of existing products like Lotus Symphony and WordPerfect. Microsoft gave themselves a great advantage here because they so constantly kept changing the underlying OS to purposely break the competition.

Zune: Copy of iPod and the dozen other MP3 players that preceded it.

Bing: Copy of Google, Yahoo, AltaVista, Lycos, etc....

Internet Explorer: Copy of Netscape, Mosaic, etc. Specifically designed to prevent people for developing web apps and instead developing ActiveX apps (i.e. apps that will only work on Windows)

Kinect: "Innovative" technology copied from an Apple IIe, circa 1978 (http://www.youtube.com/watch?v=XbTn8CGjVSs)

Surface: A desk that acts like Reactrix... The Linux powered system you've been seeing in malls and movie theaters since 2002. That's not innovation, that's an obvious application of existing technology.

Windows Live Messenger:  Verrrry late to the game, as usual for Microsoft, and a copy of many many many pre-existing IM clients that had existed since the 1960s.  Gained marketshare due to bundling with the OS and being able to connect to the exisitng AOL IM users.  MS can't compete on features... but who needs to when you can just buy Skype for IM marketshare.

Microsoft Outlook:  Wow, an SMTP e-mail client... and invented just a scant 14 years after the SMTP e-mail standard was invented and deployed.

If Microsoft does have any "Innovative" patents, they don't seem to have contributed to the invention of any new products.  The innovative stuff, like internet services, always seems to appear in free software products first.

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

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It's sad this is why I've told MS and Apple goodbye, Android has a better software and its free.

If I could I'd replace everything I own that's MS with Android and never look back.

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Joel H replied on Mon, Jul 11 2011 1:37 PM

3vi1,

You appear to think that just because someone thought up something similar, at some point, all patents are invalid. The idea that a computer could be used to create some sort of motion capture tech, and the work that went into something like Kinect, are two different things. I'm not claiming that MS filed patents on Kinect because it loves its engineers so much, but an enormous amount of innovation went into creating that device.

Being able to motion capture, as you've noted, is actually the simple part. The inherent concept of motion capture has been around for decades. What makes Kinect special is:

1) Being able to do so quickly enough to use the tech for any type of reflexive control.

2) Offering the tech for a price that's trivial (compared to average household income)

3) Squeezing the technology required to do so into a small(ish) container that can easily be carried by a person.

4) Carrying out the necessary processing in a small(ish) box attached to said container that runs quietly with minimal power consumption.

I picked Kinect because it's an easy example, but I think it's an important one. I'm no great fan of software patents, a decided *not* fan of the US implementation of software /hardware patents, and like I said--MS isn't the ideal patent poster child, period. Nevertheless, it's important to acknowledge the ways very real innovation continues to occur and deserves to be protected.

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