News

Microsoft Lays Out Intellectual Property 'Peace' Conditions to Google

• By Kurt Mackie
• 07/31/2012

Microsoft today accused Google of using diversionary tactics in a legal fight over intellectual property (IP) associated with the Android mobile operating system and other software technologies.

The accusations came from Brad Smith, executive vice president and general counsel at Microsoft, and Horacio Gutierrez, corporate vice president and deputy general counsel at Microsoft. They claimed in a blog post that Google, which now owns Motorola Mobility, is refusing to take a license for all of Microsoft's IP associated with Motorola's products. Next, the attorneys claimed that Motorola Mobility had refused to follow "market rates" with respect to "fair, reasonable and nondiscriminatory" (FRAND) patent licensing.

Google can either "engage in serious discussions to search for patent peace or persevere in its diversionary tactics," Smith and Gutierrez concluded in their blog post. They prefaced that remark by noting the consequences of past legal wars. For instance, some Motorola smartphones are now banned for sale in both Germany and the United States due to past court skirmishes with Microsoft.

Both Apple and Microsoft have complained to the European Commission that Motorola Mobility wants too much for patents associated with essential standards. In Microsoft's case, it has complained that Google wants 2.25 percent of Xbox profits for Microsoft to license an H.264 video codec technology.

Use of Microsoft's ActiveSync e-mail synchronization technology is another point of contention. In June, Bloomberg reported a Motorola Mobility offer to pay $0.33 per Android-based smartphone to use ActiveSync. In their blog post, Smith and Gutierrez decried "leaking settlement positions through the press." Microsoft typically compels companies signing IP deals with it to also sign nondisclosure agreements with regard to the settlement terms, Groklaw has noted.

If Smith and Gutierrez's blog post was supposed to be a peace offering to Google, it received a somewhat frosty reception from Motorola Mobility.

"Microsoft wants to undercut Motorola's industry-leading patent portfolio, licensed by more than 50 other companies on fair and reasonable terms, while seeking inflated royalties tied to standards that Microsoft alone controls," a spokesperson from Motorola Mobility explained on Tuesday via e-mail. "Motorola is always open to negotiations that avoid wasteful and abusive patent claims."

Google and its Motorola Mobility organization are perhaps the last-standing entity that has resisted Microsoft's IP claims on Android, a Linux-based mobile operating system that Google helped to foster. The OS is used royalty free by many equipment manufacturers making smartphones and tablets. Microsoft claims to have struck IP agreements with about 70 percent of U.S. equipment manufacturers using Android.

Microsoft is thought to currently be making more money from IP associated with Android than it does from licensing its own Windows Phone mobile OS to equipment manufacturers. According to IDC's global analysis of the mobile phone market, Android is expected to hold 61 percent of the world mobile OS market in 2012, followed by Apple's iOS at 20.5 percent. Microsoft's Windows Phone/Windows Mobile, in contrast, is expected to trail at 5.2 percent use. However, IDC expects Windows phone to vie for second place by 2016.