In what was a surprising turn of events for many in the tech community, Oracle filed a formal complaint of patent infringement against Google, demanding a jury trial and unspecified damages over the use of Java in their Android platform. So why now? Can they win? And what does it mean for Google and Java developers at large if they do?
It's one thing to sue small fish into oblivion. Anyone remember Psystar? They went up against Apple selling dubiously-licensed Mac clones. They don't sell Mac clones anymore. Big surprise.
It's another thing when a small fish sues a big fish. Big fish tend to have deep pockets that can, to the massive financial benefit of said small fish, make a lawsuit go away very quickly. Settlements, acquisitions, and licensing deals can all prove quite lucrative for the small fish with relatively small investments by the big fish, especially if the small fish actually has the intellectual property rights it brings to a court.
In both of these scenarios, there are serious financial incentives to file IP-related lawsuits. When a big fish sues a bigger fish over intellectual property rights that aren't clearcut, there has to be a bigger picture, a corporate strategy that makes the financial and PR risks worth the potential gain. In this case, it's mobile computing which, in case you haven't noticed, is the future of both consumer and, in many ways, enterprise computing. Yeah, I'd say there's an incentive here.
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Next: So just how big is that incentive? »
Oracle bought Sun Microsystems in January of this year, acquiring all of their intellectual property (much of it related to Java) for a mere $7.4 billion dollars. There were more than a few analysts who thought that number was mighty high for a company on the verge of collapse and whose strongest IP (including much of Java) had been open sourced. Suddenly, though, the purchase price makes sense if Oracle plans to leverage its more obscure patents against the likes of Google and, in the process, be entitled to a share of its Android-related profits.
Interestingly, as the Wall Street Journal reported,
Google was widely assumed to have rights to use Java under a licensing agreement for Java...The suit is "very perplexing," said Kim Polese, a former Sun manager..."Everyone is using Java."
Sun was often criticized by investors for making little money on Java. Oracle, on the other hand, seems determined to wring more profit from Sun's intellectual property..."Java is one of the crown jewels of the Sun acquisition," said Ray Wang, an analyst with Altimeter Group. An Oracle injunction could block developers from building applications using the Android platform and shipments of Android phones, he said.
In fact, if Google can be a target, then any number of Java developers can potentially find themselves in Oracle's crosshairs. However, I'm inclined to think that it's no coincidence that research released this week shows drastic gains in Android popularity and manifold increases in Google mobile search (the real source of revenue behind Android, which is open source). If Oracle can force a deal with Google, it suddenly has at least a business class ticket on the mobile train and can even start looking at vertical markets that include mobile technologies.
So will Oracle win? A fair number of analysts believe that there will be some sort of licensing deal that comes out of this, although the size and scope may very well not be the windfall for which Oracle is looking. If Oracle wins, though, how much does Google lose? Google executives have repeatedly hung their hats upon the future of mobile, which means Android. Mobile search, mobile platforms, and mobile content will all be cash cows for Google long term. It remains to be seen how big a chunk, if any, Oracle will take out of that cow.
We're looking at months of litigation for this to play out and neither company really stands to benefit from a quick settlement. Google, for its part, needs to demonstrate that there was no infringement to protect Android, future revenues, and, perhaps more importantly, the Java developers who make Android compelling. Oracle, on the other hand, wants more money than Google is likely to give without being ordered to do so by a jury. Oracle essentially asks for the destruction of code that leverages Java in Android, but it would be foolish to not take a major stake in future Android-related revenues instead if it can get them.
A complete copy of the complaint is here. Read it and talk back below - Do you think that Google really infringed on copyrights or is Oracle just coming late to the realization that mobile is a platform that can't be ignored, even if you're, well, Oracle?
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