Without radical change in patent law, Android's ecosystem will die

Only the invalidation of Apple's utility and design patents will save Android from possible extinction as a widely-used mobile device platform.
Written by Jason Perlow, Senior Contributing Writer

As we have seen from the outcome of the Apple v. Samsung trial, the jury found that Samsung willfully infringed upon intellectual property patents which Apple held that caused customer confusion as to product origin and as a result, damaged Apple's sales.

Whatever you think about the "rightness" of the decision, a decision in a court of law is a decision in a court of law. And if that decision is ultimately upheld, then I think we can all agree that the Android ecosystem of the future will look very different than the one that we see today.

I believe it is extremely likely that many if not all of the infringements of Apple's patents by Samsung will be upheld.

While the companies battle it out in appeals court, what can Android partners such as Samsung do in their defense? Make software and design changes so that Apple cannot pursue bans on their products?

As I said in a previous article Samsung and Google need a new dress, it is possible for Android partners to avoid further litigation and bans by creating a distinct trade dress for their devices which are unmistakeable from iOS devices.

Amazon appears to have done this successfully with Kindle Fire and this has kept their products out of Apple's legal crosshairs. For now. I'll get to that in just a moment.

Software alterations would also have to be made in order to avoid patent infringement. The most notable of which is D'305, which covers a grid of rounded square icons against a black background -- the trade dress of Apple's iOS.

There's a bunch of ways Google and its partners could handle this. Obviously, change the icons to circles or some other shape, and change the arrangement of the icon grid, perhaps to something more geometric.

In any case, Google and its partners need to patent it when it is done.

But aside from trade dress/industrial design alteration, there is also the issue of the utility patents that were violated in the Samsung v. Apple case, and the only way to avoid that would be to remove the infringing functionality.

Much of this functionality is critical to the way in which mobile devices operate, such as Apple patents D'381, D'915 and D'163, which cover many of the multi-touch gestures we come to think of as very basic in the operation of mobile devices, such as pinch to zoom/twist and touch scrolls, among several others.

I have another scenario to propose, and it's not rosy for the OEMs. Considering all these trade dress and software functionality changes may need to be done in order to avoid litigation, it is possible that we may see a number of the OEMs -- perhaps even Samsung itself -- drop out of the Android business entirely.

Google may wish to counter this OEM diaspora by making Nexus the only brand of Android device. The logical thing for it to do in that case would be to use OEMs as ODMs (Original Design Manufacturers) with Google shouldering all of the device support as well as any future potential legal risks.

This is how a giant like Samsung can stay in the game, in its traditional component and third-party device manufacturing role. But Google would have to completely indemnify Samsung as the primary ODM in this scenario.

But what about Amazon, who uses Android as the software foundation of their Kindle Fire tablets?

Amazon has managed to avoid Apple's legal crosshairs by creating a distinct trade dress for the Kindle Fire and also a unique user interface which looks nothing like iOS and by the same token, nothing like Android.

Even if it were to be determined by Apple internally that the Kindle Fire infringes on their own utility patents, it is very unlikely that Apple would pursue a legal confrontation like we have seen with Samsung.

As the largest online retailer in the world, Amazon represents a critical sales channel for Apple products, so Cupertino is not stupid enough to poison its own well. If it came to it, Tim Cook would license via FRAND what is necessary to Jeff Bezos in what would amount to chump change for Amazon.

In fact, Amazon may be the company which could benefit most from the misfortunes of other Android OEMs.

As I said in my article over the weekend Amazon could end up owning the bulk of the Android tablet and device market, if any variation of the worst-case scenarios I mentioned earlier come to pass.

If Google is forced to consolidate its resources and moves exclusively towards a strategy of releasing Nexus products designed and built by ODMs to be the public face of Android, rather than the fragmented device ecosystem that is under bombardment by Apple in the courts now.

Amazon is in an excellent position to become the primary supplier of Android tablets, as my ZDNet colleague David Chernicoff noted recently.

Amazon has proven it can market the devices cheaper than Google and its OEM partners by having them ad-subsidized, while at the same time providing a more integrated content consumption ecosystem of books, movies and apps.

And Amazon as the world's most prominent internet retailer has a weapon that neither Google nor any of its partners have: Prime, which it can use as a value-added benefit to using Kindle Fires in the form of more and more free incentives to those who subscribe to the service.

And as to where the OEMs might go if they have to abandon the Android smartphone and tablet market, the answer to that is an obvious one.

I believe Windows Phone 8 and Windows RT would be excellent alternative platforms for OEMs to pursue. Samsung has already done this by previewing the ATIV line of products it has shown most recently at the IFA in Berlin.

While the platform has not experienced tremendous success in the consumer space like Apple's iPhone or the offerings from Android OEMs, Windows Phone/Windows RT/Windows 8 has a unique trade dress and industrial design that sets it apart from the iOS design and utility patents.

So Microsoft's mobile offerings (and those of its OEMs) are safe from Apple litigation in that respect.

It should also be noted that Apple and Microsoft have always been at some form of detente because Redmond develops critical apps for Apple platforms, such as Office the Mac.

Microsoft has also licensed ActiveSync to Apple in order to make corporate Exchange email functionality work on iOS. So the two are in sort of a Ying and Yang balance and have agreed to tango with each other.

Which brings us to a side topic: the fate of Research in Motion and the BlackBerry platform, and whether or not Windows Phone will emerge as its natural replacement.

Strong Windows Phone adoption would damage RIM, because the core of what RIM is trying to do is secure enterprise messaging and Windows Phone 8 has that same core functionality.

One might think that Apple's victories in the courts would make RIM's platform more viable, but that would be a very foolish line of reasoning.

RIM would derive very little benefit from Apple's patent victories other than the fact that Apple doesn't see them as a major blip on their radar screen.

RIM is still going to go down the toilet at the same accelerated rate as before, unless by some miracle, BlackBerry OS 10 is a crazy hit with consumers, the developers take to building QNX apps like flies on dung, the PlayBook rises from the dead like <insert your favorite religious icon here> and the enterprise reverses course on dumping their BlackBerries like yesterday's fish wrapping.

Still, I cannot predict what goes on in the complex minds of consumers. I can only analyze industry patterns and see if there are common trends that emerge.

But I don't think there is really room for three or four major platforms, there's room for two at best, especially given the horrendous economy we're all saddled with. I've made that argument in the past and I continue to stand by it today.

I think that the new Nokia products that were just introduced, the Lumia 920 and 820 look like excellent products and the PureView photographic technology that they are bringing to the table is phenomenal, which may give them an advantage.

But I am not sure the Finnish handset manufacturer can generate enough sales in a rapid enough fashion in CY 2013 to keep them above water.

We'll see how Samsung's Windows Phone 8 offerings do next year.

Now let's get back to the issue of patents.

For the time being, Apple has chosen a strategy of attacking Google's Android OEMs via proxy war as opposed to a direct legal assault.

This is the most prudent war strategy for Apple because if it can force Google's partners out of the market, Android is effectively neutralized.

But this is not to say that direct litigation might not come to fruition. It still could.

If Apple attacks Google directly with a lawsuit, then it would for the most part take on the form of what they did against Samsung.

Apple's lawyers would need to prove to a jury that that Google violated the company's design patents for

  • a) Industrial Design/Trade Dress, 
  • b) Utility patents/Software functionality

I think the emphasis would be more towards b) rather than a) and Apple would be more likely to drag out many more examples of b) than we saw in Apple v. Samsung.

Apple does have an awful lot of utility and design patents.

However, there's a twist. I believe there would be additional claims brought forth by Apple's litigation team that:

In essence, that Eric Schmidt and other Google executives willfully engaged in a form of corporate espionage.

If Apple attacks Google directly you can be sure that this is going to be brought to the front and center. It won't be pretty.

If you thought Samsung's dirty laundry in this last trial was bad, wait until you see the stained underwear collection from the Googleplex.

Android will stumble badly if any of the conditions occur where the key design and utility patents are upheld in Apple v. Samsung even after a lengthy appeals process.

In the interim, Samsung will have to make radical changes to their handset and tablet products which may resonate badly with consumers. 
This could cause them and other OEMs such as HTC, which are already in a weakened financial state, to exit the market, particularly if Google goes with an all-Nexus strategy as I discussed above.

This is a very likely scenario in my opinion.

But even with all of these legal encumberments, even I have to admit that Android as mobile OS has staying power. It's too big to go away completely, and the fact that it is an Open Source project means that the code could continue to thrive even under alternative or even community stewardship (think Amazon or even Apache) for a long time to come. 

We also have to take into consideration that China has a huge domestic demand for Android-based products, and one that plays by a completely different set of cosmological constants than the North American market.

I don't see Apple trying to attack Chinese companies, particularly given how reliant Apple is on the Chinese manufacturing base.

But we may need to face some hard realities here. It is very likely that Apple will ultimately prevail against Samsung, and as a result of the damages awarded to Cupertino (which could triple) the Korean giant might have to make some difficult choices.

And if Samsung withdraws from the market or has to affect drastic changes to its products to avoid infringement, so will HTC and any number of other weaker OEMs.

Drastic changes do not necessarily bode well for Android's ecosystem. As my colleague James Kendrick has said, people like the fundamental aesthetics and basic functionality aspects of Apple's products, and that may be the only formula that the buying public is willing to accept.

Unfortunately for Samsung and Google, those aspects are patented. By Apple.

As if customer preference towards Apple's patented design and functionality isn't reason enough to worry about Android's longevity, it is becoming increasingly likely that the Android device ecosystem of the future will be homogenous instead of being a heterogeneous one

This would be not unlike what exists today in in Apple's supply chain driven world (a la Foxconn and Samsung) where Google controls who manufactures and supplies components for their devices.

Google's walled garden will have fewer guard towers and nicer guards, but it will still be a walled garden.

And while Android may not "die" in that sort of a world, it won't prosper either. In a choice between walled gardens of Apple-controlled, Amazon-controlled, Microsoft-controlled and Google-controlled products, the players with the more powerful ecosystems and the most patents will prevail.

For Android to thrive, the US Patent system as a whole requires reformation, or Apple's utility and design patents that give them a virtual stranglehold on the industry need to be invalidated.

I don't see either of the two things happening anytime soon.

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