Microsoft wants 'patent peace' in ongoing Motorola spat

Microsoft wants 'patent peace' in ongoing Motorola spat

Summary: Microsoft's lawyers pen a public note to Motorola: 'We want to talk because this patent nonsense is getting way out of hand.' Will the two companies kiss and make up, or squabble until a court rules?

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Microsoft and Motorola continue to butt heads over patents and the licensing of each others' technologies.

The two companies are not friends, but Microsoft wants to be, months after Google acquired the handset maker -- as well as its patent troubles. 

The Microsoft-weighted v. Motorola spats continue to roll on with no end in sight, but Microsoft wants "patent peace" between the two companies.

In a blog post by Microsoft general counsel Brad Smith and deputy general counsel Horacio Gutierrez, the two top lawyers said Google "mounted a public relations and lobbying campaign deflecting attention from its refusal to honor its promise to standards bodies to license standards-essential patents on [fair and reasonable] terms," which led to authorities on both sides of the Atlantic in the U.S and the EU to investigate. The lawyers said they "expect[ed] more" in the future.

So far we have: 

Across the U.S., more than a dozen Android-powered Motorola devices are banned from being imported to the U.S. for sale because Motorola was found to have infringed Microsoft's ActiveSync patent, thanks to a ruling by the U.S. International Trade Commission (ITC).

More recently, a German court banned the sale of all Motorola devices running Android because the smartphone maker infringed a Microsoft-owned patent relating to file storage.

However, Microsoft didn't come away from the scrap unwounded.

Motorola secured an injunction against Windows 7 and the Xbox in Germany over H.264 video codecs, though the sales ban will not be enforced immediately. Microsoft said it wanted to use the video compression technology, but Motorola would charge in the region of $4 billion in annual royalties -- which Microsoft said was not at the market rate.

EU authorities are investigating to see whether its handling of patents breaks antitrust law or not.

In order to come to an agreement, a "lasting solution of these disputes will not be reached by leaking settlement positions through the press," adding: "Patent peace will be found through good faith engagement."

Microsoft just wants everyone to all get along. 

Microsoft has always been, and remains open to, a settlement of our patent litigation with Motorola. As we have said before, we are seeking solely the same level of reasonable compensation for our patented intellectual property that numerous other Android distributors -- both large and small -- have already agreed to recognize in our negotiations with them. And we stand ready to pay reasonable compensation for Motorola's patented intellectual property as well.

Both Smith and Hutierrez went on to detail the two principles to so-called "patent peace," that continues to churn up both companies' time, money and energy. In true dual-esque style, Microsoft noted Motorola's bid to sidestep the ITC's ruling by "cherry picking" Microsoft's propriety technology would only be for "selectively disarming an opponent" rather than seeking a mutual agreement.

The second issue relates to market rates over H.264 video codecs, one of the most popular codecs available. "These and other well-established market rates, along with appropriate safeguards to ensure Google lives up to its FRAND commitments in the future," the blog post read. Microsoft just wants a fair price to buy a license to the patents so it can move on and carry on.

But the lawyers warned Google that litigation now "stands at a crossroads."

With its phones and tablets now subject to injunctions in the U.S. and Germany, Google can no longer doubt the relevance of Microsoft's patent portfolio to Motorola's products. Google can take one of two paths: it can choose either to engage in serious discussions to search for patent peace or persevere in its diversionary tactics. We hope it will choose the first course, and we stand ready to engage in good faith if it does.

A Motorola spokesperson told ZDNet in an emailed statement:

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. Motorola is always open to negotiations that avoid wasteful and abusive patent claims.

Microsoft is serious about kissing and making up, but it's not going to lie down for Motorola -- despite its acquisition bringing the patent fight directly to Google.

All eyes are on Microsoft v. Motorola. Whether or not the two companies will resolve their differences or not remains to be seen. But Microsoft has made it clear: it wants to go back to work and continue building, and doesn't want to carry on needlessly bickering.

Your move, Motorola. Choose wisely.

Topics: Microsoft, Google, Legal, Patents, Smartphones

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38 comments
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  • Not really a change in Microsofts position

    Isn't this what they always wanted?

    Google/Motorola is uncomfortable with MS having successfully won settlements (and license revenue / cross-licensing) with a number of Android phone vendors. Google would like to drive a wedge through those agreements. They've used Motorolas patents to do that - essentially threaten Microsoft that if they don't back down they will hit them with the H.264 patents.

    Microsoft for its part is not going to back down from licensing their patents to Android vendors. And if they made an exception for Motorola they could see a number of other vendors wanting to re-negotiate the terms. Microsofts licensing terms need also be "non-discriminatory" in practice - although not required so by law.

    Google/Motorola has a weak case on the H.264. They are standards-essential patents and they have already licensed them to a number of licensees. Using it as a wedge against Microsoft is not going to hold up in court. They will end up being ordered to license to MS on the same terms as they license to other licensees (standards-essential patents *must* be licensed on a non-discriminatory base).

    On top of that, using a standards-essential patent like that - for a ubiquitous technology like H.264 - can easily earn Google/Motorola a hefty penalty from governments. Especially the EU could hit them with up to 10% of their revenue *per year* they have been found to misuse a patent to exclude others from the marketplace.

    But this is how the case has always been.
    honeymonster
    • Google also wants H.264 to go away

      while trying to force their V8 codec to be the standard.

      I'm guessing that Google is trying to price H.264 so high, while offering to license V8 for next to nothing, that companies will switch.
      William Farrel
    • Good assesment.

      You have pretty much pinned the tail on the donkey. The bottom line problem really is with Google on this one. If Google simply agreed to licence at the going rates the whole mess would be cleared out of the court in short order because from what I have understood on this issue is that MS is only asking a going rate on their patent licences.

      The problem seems to clearly be, is that Google wants none of that, and are now attempting to hold unreasonale patent rates over the head of Microsoft to work out a deal that would exempt Google or maybe licence for some paltry nominal fee. As pointed out, Microsoft feels, and rightly so, that such an approach is not at least currently the way this kind of business is done, largely meaning there are plenty of patent licenceing agreements in place all around and if this one with Google takes place in some substantivly different manner, it upsets the whole apple cart.

      And it really could upset the whole apple cart. Not just for MS patents but it could set off chainreactions over the next couple of years that could create a real mess in the patant world generally. It may create some serious problems for any number of products and cause some nasty set backs for any number of companies trying to cope with a new breed of negotiations, not to mention some great inconvenience for consumers who would actually like to go out and purchase the patented products in question.

      I dont think Microsoft wants to take the leading edge in such a fiasco, and I honestly fail to see any reason why they would want to or should want to. I generally dont see how its immediatly apperant that it would be more profitable for them and I can see how it could end up forcing them into a batch of renewed negotiations that might well also lead to less profitable outcomes.

      Say what you want, but no company thats run for profit is under any kind of mandate to start entering into charitable negotiations with other business just because the other party is not particularly interested in the status quo. If some new outlook on a way of doing business in some area is going to be taken up, its pretty much going to be without fail that if its an area of business that involves lots of money, quite a number of people have had a look at it and feel its a more profitable way, at least in some form or other.

      Go ask Google to start doing things a different way that negativly affects their profits and I would gladly lay bets on the nature of their response.
      Cayble
  • crybabies

    Googlers are nothing but a bunch of cry babies, they should be heavily penalized for abusing the FRAND patents as a model punishment and the EU is just going to do that
    owllnet
    • bunch of cry babies?

      @Owllnet,

      How is Google a cry baby?.
      They charge to use their IP( Frand or non-Frand) just like everyone else charge.

      You explain to me why the Judges is quick to ban Motorola's products for infringe; but allow

      MS (even thought they was/are found guilty of infringing) to continue selling their product?.

      MS has the most to lose, with their childish behaviour they will give Sony PS3 a chance to get back in the console market, they know this this is why MS is scare and want to settle.

      Google should NOT settle until MS sign a pact to not sue anyone that use Android OS.
      Marty Kaan
      • Well Marty.....

        I guess you don't know what Frand and non-Frand patents are! There's no work around for Motorola patent so that why it is a standard. As for MS patent, it's not a standard and non-frand cause you can use something else besides their patent. But wait..... We want our product(Moto) to do this and that, well who care's what MS think and we'll use it (MS Patent) anyways.
        stm24
      • Well Marty.....

        I guess you don't know what Frand and non-Frand patents are! There's no work around for Motorola patent so that why it is a standard. As for MS patent, it's not a standard and non-frand cause you can use something else besides their patent. But wait..... We want our product(Moto) to do this and that, well who care's what MS think and we'll use it (MS Patent) anyways.
        stm24
      • Well Marty.....

        I guess you don't know what Frand and non-Frand patents are! There's no work around for Motorola patent so that why it is a standard. As for MS patent, it's not a standard and non-frand cause you can use something else besides their patent. But wait..... We want our product(Moto) to do this and that, well who care's what MS think and we'll use it (MS Patent) anyways.
        stm24
      • @Marty Kaan. You live in dreamland

        You say:
        "MS has the most to lose, with their childish behaviour they will give Sony PS3 a chance to get back in the console market, they know this this is why MS is scare and want to settle."

        That rediculous statement alone shows your brain is fried. Microsoft hasnt got anything to lose because in the end, in the worst case scenerio Microsoft will only lose whatever cash it cost them to take the fight to the end. And its an end that Motorola will lose.

        In case you couldnt follow the legallities of this story, or any of the mostly well explained posts here, Motorola is barking up the wroong tree because the nature of their patents demand fair licenceing and they are wanting to charge MS rates that are not fair. Microsoft on the other hand have not demanded rates from Motorola that are not already being paid by others.

        The only reason Microsoft issued the statement IS because they now know they have nothing to lose and Motorola is on the downward slide of a slippry slope. Microsoft is like the guy in a boxing match who has just knocked the opponant to the floor and is now saying to him, "I would like this fight to end now, if your ready to be reasonable. Others are doing things this way and so should you."

        If Motorola gets up and as you say " NOT settle until MS sign a pact to not sue anyone that use Android OS", it will actually be EU authorities who do the finnal pummeling of Motorola into submission and Microsoft will be standing around saying:

        "I told you so".
        Cayble
  • They don't want peace they just want to

    get rid of Google so they could go after those who can't afford to fight back!
    L3thargic
    • Seriouslly> 'the ones who can't fight back'?

      looks to me that MS has been going after companies just as large as themselves.

      Why can MS fight, but not their equal?
      William Farrel
    • Your comment is logically ridiculous.

      You say Microsoft is trying to “get rid of Google so they could go after those who can't afford to fight back!”

      Now I’m going to point out just why that’s such a ridiculous statement.

      1. If its Microsofts goal to get rid of those who cannot afford to fight back, then why not just do that and forget about Google for now if Google can fight back?
      2. Your statement implies that Google can fight back, you also plainly say Microsoft is trying to get rid of Google. If Microsofts goal is to get rid of Google, who according to you can fight back, what is the whole point of your so called point about “those who cant afford to fight back”?? Google can fight back, Microsofts trying to get rid of them…how does that even relate to the conclusion that they are fighting someone who can fight back, in order to get rid of those who cant fight back… It dosnt matter how many times you think it through there is no logical connective reasoning between the two points. Its stupid.

      Its not like Google is running around fighting the little mans fight for them. What are you even trying to imply???

      Are you saying if Microsoft destroys Google the little guys will have nobody to protect them??

      I don’t see Google protecting anyone that isnt part of Google.

      Are you implying that Microsoft can only beat up on the little guys??? But you yourself are saying that Microsoft is beating up on Google, who you seem to imply can in fact afford to fight back.

      Sorry, but the only logical conclusion anyone could come up with from your statement would be that you are a pathetic Microsoft hater who spouts off nonsense designed to make Microsoft sound bad even at the expense of making yourself sound like an idiot because what your saying is completely illogical.
      Cayble
  • Standards-essential patents

    These should be forbidden. If you want your proprietary technology in any standard: make it public domain first.
    danbi
    • Agreed.

      No argument there.
      William Farrel
  • Microsoft wants 'patent peace' in ongoing Motorola spat

    Microsoft is being the bigger man here by at least trying to negotiate with Google/Motorola. Google really needs to take this seriously otherwise they will be left in the dust with their android devices. Now that I think about it, I have absolutely no problem with that.
    Loverock Davidson-
    • Microsoft is being the bigger man

      Yea, right!... your so-call BIGGER man (with it side kick Apple) Started all this mess..

      Google don't care if Motorola cellphone (wasn't a hot seller any ways) get's ban, it's the IP's they want and use.

      Now, Google need to finish applying pressure on MS with it's 17,000 patent ( hire a group of people to comb thru it) and sue MS and Apple for infringements..non-stop 24/7
      Marty Kaan
    • Bigger man? Indeed.

      No offense intended here, but your 'bigger man' comment is a bit naive. There is absolutlely nothing benevolent about MS, Google, Facebook or any large multinational company. It is the corporate equivelent of warfare, and uses much of the same dirty tactics, lies and deceit we see every day from Washington. The history of Microsoft illustrates that old adage "Power corrupts, and absolute power corrupts absolutley". During the antitrust case years ago, there was evidence of this when Gates blurted out at a dinner party about his disdain for the governemt intrusion into his business and that he would deal with them, as Melinda kicked him under the table. Yes, I am paraphrasing. I believe the actual comments were far more severe. Not that I'm singling him out. Watson, Edison, Gates, Ford, Jobs - you name them - they all operated like they were untouchable. The writer of the above comment also said 'Great men are almost always bad men". Maybe not criminal, but immoral at times, absolutely. Google is no different, but I'm glad they are there, if anything to even the playing field. In ten years, the players will have likley changed, but the story will remain the same. That's life, I accept it as a capitalist myself. I guess I don't choose greed as the primary basis for running my business. There are no nice guys (or women) here in the business sense, although I'm sure their pets love them.
      Allerion
      • Ha! Good post!

        Well said. More even handed then a lot of the sheer stupidity some of these windbags spout off around here.

        There are no clean hands here if clean hands mean "no profit driven motives". All these companies motives are profit driven.

        There is absolutely nothing that makes Google, Motorola or anyone of them a company "for the people". They are not. Not one of them.

        In case anyone has missed it because they are blind and very stupid to boot; Google is making every effort to suplant themselves as the new OS leader in the world. They are ready and trying everything they can think of to do exactly that. It in fact is not nearly so much of Microsoft trying to destroy Google, its by far Google looking to destroy Microsoft.

        That much is both obvious and a given. Its just that their plan is going so poorly.
        Cayble
      • bingo - that's the system

        Like it or lump it, as taxpayers we subsidize it.
        HypnoToad72
  • Google wants patent peace too

    After all, Google didn't start the patent wars. Apple, Microsoft, Nokia, and Oracle started the fight. If they don't like the bruises they've been getting, then they should have thought about that.

    Also, if they're demanding $2-$5 per device for something as simple as rubberbanding but are only willing to pay $0.0049 for a patent that makes 3G work then they really don't want to have patent peace. How expensive are the phone cases? Apple want to charge $24 per case because they're rectangular with rounded corners.

    I'm not sure how much Microsoft is demanding for the interoperability with their desktop monopoly of Windows prior to XP in terms of mapping long and short file names. However, the FAT patents Microsoft got the removable drive manufacturers to pay just $0.01 per drive. This patent however is easy enough to avoid either with the compile option to remove the mapping support or just not to have FAT on the devices at all for a couple of years. Google has prepped everything in Android 4 that FAT is unnecessary.
    BorgX