Microsoft cements position as Android's patent toll collector

Microsoft cements position as Android's patent toll collector

Summary: Microsoft is going to make money from almost every Android device shipped.

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Samsung's move to license Microsoft patents for its Android devices means that the software giant as secured its position as toll collector for most devices powered by Google's mobile operating system.

You see new Android Samsung phone. Microsoft sees licensing revenue.

Some will argue that these Microsoft-Android licensing deals are heresy and a sign of a patent system run amok. For these folks, the Samsung deal is a sign of a broader problem. Others will argue that Microsoft is just exercising its intellectual property rights. No matter what side you take it's hard not to notice the irony that Microsoft is going to make money from almost every Android device shipped.

Microsoft said in a blog post that Samsung and HTC both signed licensing deals and the two together "accounted for more than half of all Android phones sold in the U.S." Motorola Mobility, which was acquired by Google, is the holdout. Motorola and Microsoft are currently in court. If Microsoft wins in court, it's possible that Google will even have to pay the software giant---assuming the search giant closes the Motorola Mobility deal.

Mary Jo Foley: Samsung signs Microsoft patent licensing deal to cover Android devices

CNET: Microsoft, Samsung strike licensing deal

For Microsoft, these Android licensing deals with Samsung, Acer, General Dynamics Itronix, Onkyo, Velocity Micro, ViewSonic and Wistron show that "licensing works." From a business model and competitive perspective, Microsoft's moves on the licensing front are brilliant. If Android wins, Microsoft gets a licensing stream. If Windows Phone takes off Microsoft also collects. Add it up and Microsoft has two horses in the mobile OS race.

According to Microsoft these licensing deals "show what can be achieved when companies sit down and address intellectual property issues in a responsible manner." Microsoft then targeted Google and said that if "industry leaders such as Samsung and HTC can enter into these agreements, doesn’t this provide a clear path forward."

The path forward for Android appears to be licensing patents from others. Microsoft has its hand in the Android pie and don't be surprised if Oracle ultimately does too.

Android is increasingly looking like a highway: A public resource that features a lot of tolls along the way.

Related:

Welcome to the patent valuation bubble

Topics: Microsoft, Enterprise Software, Legal, Samsung

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22 comments
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  • RE: Microsoft cements position as Android's patent toll collector

    And folks see this as a good thing for Microsoft?<br><br>Patent trolls has been around for years. It's just now the big monopoly wants to monopolize that once small industry to become their business model.
    Return_of_the_jedi
  • RE: Microsoft cements position as Android's patent toll collector

    "Add it up and Microsoft has two horses in the mobile OS race."

    Yep.

    It's ironic that royalties on Android are probably large enough to pay for Windows Phone development in its entirety.
    Rich Miles
  • the community will not put up with this racket

    The people will rise and demand a stop to M$ illegal tax!<br>Shame on those cowards that signed on the dotted line deals that take away your constitutional freedom!<br>The people will stand united with google and Motorola against the axis of evil software: M$, Apple & Oracle.
    The Linux Geek
    • I hope you're right

      @The Linux Geek <br>But The People rarely act like a unified whole and the fact that people continue to voluntarily patronize demonstrably unethical companies like MS doesn't bode well for your prediction.

      Reply to LiquidLearner:

      We're discussing MS right now, not Google. But if you think Google is unethical, then take their success as further evidence of the public's tolerance for market manipulation and monopoly games.
      John L. Ries
      • and google is the ethical?

        @John L. Ries

        Now that is funny! If Google backed their product then the OEMs wouldn't be left to fight this themselves. Of course it's smart for Google but sucka for the partners.
        LiquidLearner
    • and how will they do that?

      @The Linux Geek

      By not buying Android from companies that have a licensing deal in place? They would move onto Windows Phone then. That would teach Microsoft!

      you also don't seem to understand what a patent troll is. Microsoft actually creates products with their IP, they don't just sue others based on an idea they had. We get that you think open source means you think software companies should be able to steal and use whatever they like. The legal system doesn't agree with you. Samsung is easily big enough to fight but they seem to think a loss would be likely. Which would cost them even more in the long run.
      LiquidLearner
      • So which MS patents does Android violate and how?

        @LiquidLearner
        MS has never publicly said, but maybe you have some insights.
        John L. Ries
    • Android is NOT free, you've been dubbed

      Google is an advertising/Marketing firm, so you are essentially selling them your info for their "Free" Services. I'd rather pay for the services I use and get a better product.
      ManKzin
  • RE: Microsoft cements position as Android's patent toll collector

    They are not really patent trolls. They are a real company with real products. The products are very relevant to their business and so are the patents. A patent troll is more about a company that has no products, nothing relevant, yet still gets legal teams, collection teams involved to get money for a patent they likely acquired because they saw a financial benefit. Patent trolls are more like gamblers hoping to get a big pay off. Microsoft has a strategic business and technology interest in protecting what it has developed.

    If the patent system changes dramatically and everyone is left to win based solely on their merits of their product...that won't happen either. Because then there will be companies with marketing budgets or other hooks that win based on something other than the purity of their product being great.

    For those who think innovation is stifled, look at the past 5 or 10 years. There's been a slew of leaps in technology and products offered. And companies without prior experience in a product line have leap frogged and won against existing companies.
    billdepot@...
    • No such thing as patent troll

      @billdepot@... As long as the govt allows patents to be treated as property. Why does someone need to create something in order to profit from a patent?

      And am sure that those complaining about the "trolls" would do the same if they suddenly found themselves in possession of a patent that was valuable.
      otaddy
      • RE: Microsoft cements position as Android's patent toll collector

        @otaddy I can't speak to whether people would do the same. There are likely people having a patent and want it to be used for the greater good therefore not try to gain financially from it. And yes there are plenty of people who'd go for the money if they were given the chance.

        I didn't say someone should not profit from a patent. I said I do not consider Microsoft to be a patent troll.

        However, I think it's easy to view the practice of patent trolling to be largely about funding non-productive entities (placeholder corporations, legal constructs) rather than about furthering the thing the patent is about. The entity is not trying to create something or push the thought or product forward. Very typically the entity is only trying to collect money. i can understand how this can be viewed negatively even if this negative view is not really fair.
        billdepot@...
  • Smart for Samsung - let Googlerola fight, then let deal lapse

    Not hard to count beans and conclude that it's good business to pay a little for the next X years, then letting the deal lapse when Googlerola kicks the can off the field. How else can an OEM that also wants to make Windows phones (and eventually, tablets) deal with this? MS has not just the threat of patents, but also withholding WP7/W8.

    To be clear, I hate it ... but it sounds smart.
    daboochmeister
  • RE: Microsoft cements position as Android's patent toll collector

    We can all see the PR MS uses, but we don't know about the conditions. MS asks for extreme secrecy about this kind of negations. See Barnes & Noble that would not play that game.
    It is in the interest of MS that everybody thinks that is has strong patents against Android, and receives a lot of money for every device. So they can go knocking on the next door...
    It may be true they get a lot from Samsung, but if it is not the case, MS will still give that impression.
    Just suppose Samsung did reply they were not interested unless for a really small amount. If MS did agree, under condition of secrecy, the press release would also look like the one we see now.
    Why suggesting this? Maybe Samsung felt weak in his battle with Apple. Or just strong because they did invest anyway to defend themselves against Apple. And Microsoft was not that strong, I suppose the same patents used against Apple could be used someday against WP7. And/or they want to sell WP7 claiming it has no patent problems. And they probably also want to avoid a Samsung - Apple situation, knowing that public outcry could kill their patent game.
    somereader
  • RE: Microsoft cements position as Android's patent toll collector

    Microsoft greatly increased patent filings in 2002, and it looks like it paid off for them.

    Microsoft invented a lot of Android processes about 10 years ago and their patents show that.
    Austin02
  • RE: Microsoft cements position as Android's patent toll collector

    Microsoft greatly increased their patent filing about 10 years ago.
    Austin02
  • An example of Microsoft's &quot;Innovation&quot; . . .

    "the hypermedia browser has a content viewing area for viewing content and is configured to display a temporary graphic element over the content viewing area during times when the browser is loading content"

    Good grief . . .

    US Patent: 6339780

    http://www.google.com/patents?id=DwEJAAAAEBAJ&printsec=frontcover&dq=6,339,780&hl=en&ei=04iDTpDkI4u38gPU3OgJ&sa=X&oi=book_result&ct=result&resnum=1&ved=0CC8Q6AEwAA
    ziggysdaydream
  • RE: Microsoft cements position as Android's patent toll collector

    What are the actual patents that has such a stronghold for Microsoft?
    bernardmoon
  • RE: Microsoft cements position as Android's patent toll collector

    What are the actual patents that has such a stronghold for Microsoft against these companies?
    bernardmoon
  • RE: Microsoft cements position as Android's patent toll collector

    Microsoft is basically finding ways to sustain in the market ... because they are not into it now because of google and facebook and afraid of losing their repo.

    My Website :- <a href="http://www.webslambook.com">Webslambook</a>
    touchwebinc
  • RE: Microsoft cements position as Android's patent toll collector

    what "software giant"?, MS!?, pff...
    that guy is what you would call a heir living.
    and I don??t think Windows phone will ever stand a competition.
    paulomunir