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back to article Microsoft's Android patent ransom to 'total $444m' next year

A report from the technology analysis team at Goldman Sachs estimates that Microsoft will suck up $444 million in Android royalties over the coming financial year. The group estimates that Microsoft will make between three and six dollars per device, after signing patent-protection deals with smartphone and tablet manufacturers …

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Silver badge

And people said..

...that Microsoft didn't like Open Source Software. I think they love it.

Pretty sad too.

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Anonymous Coward

Arh...

"The group estimates that Microsoft will make between three and six dollar per device..."

Arh, me ruv you rong time.

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Terminator

Goldman Sachs and Microsoft

Two perfect examples of what's so wrong with society today.

Phhhh ... what a scam. Time for the B-Ark, methinks.

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Facepalm

Goldman Sachs?

Are they the same people who told me that a shack in the swamps was worth $500 million and if I took a mortgage with them, Id get a free death star as a joining bonus? Also, didn't they advice the Greek government on how to join the Euro, no questions asked?

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Angel

Life is all about choices...

So, decide to choose a non Microsoft handset and the clear winner is Microsoft.

I have to admire the communist aspect of capitalism in the tech business...

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Linux

Is'nt this

the case where m$ claim that linux infringes their patents, but wont say which ones, but then go on to use this as a threat against other tech companies using linux

If only the various linux companies had enough money to buy some lawyers and challenge m$

Although I suspect it would be cheaper to buy some congress ppl and get the patent law changed

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Pint

Re: Isn't this

>> If only the various linux companies had enough money to buy some lawyers and challenge m$

In 2009 Samsung had revenues of $172 billion and 276,000 employees. It is one of the largest and most diverse industrial cartels on the planet.

Samsung accounts for 20% of South Korean exports.

"Samsung Electronics overtook Sony as one of the world's most popular consumer electronics brands in 2004 and 2005, and is now ranked #19 in the world overall. Behind Apple, Samsung is the world's second largest by volume producer of smart phones with a leading market share in the North America and Western Europe" [Wikipedia]

Samsung has money. It has engineering.

It is a tough-minded, throughly competent player in this business. So tell me why it is licensing Microsoft smartphone/tablet tech that you think has no value.

Tell me why you are putting all your chips on Google.

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Anonymous Coward

No, this is the case where Microsoft clains Android infringes their patents

They tried with Linux by proxy (SCO, Novell a.s.o.) and they didn't get too far because Linux has some extremely mighty friends armed with deadly patents and mean lawyers you surely don't want staring at you down the gun barrel.

Android is another kettle of fish and most of handset manufacturers keep including MS goodies like the FAT file system which makes it an easy target.

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Anonymous Coward

@westlake - I can certainly help you with this

Samsung pays 0$ for Android, so even contributing to Microsoft welfare fund 5 to 10 $ from each device sold, they still make a decent profit. Comparing this to Samsung being blocked from selling Android completely and (possibly) on top of that being forced to pay for infringement and litigation, you'll see that there is no need to fight. This is the principle of milking, you don't harm the cows.

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Facepalm

Loosing rebates on Windows licensing on computers they sell would be much more expensive than puny Android litigation costs.

If that's not monopolistic behavior (using dominance in one platform to leverage your solutions in another) then I don't know what possibly can be.

MS should be fined again, this time for significant part of their revenue, at least half year's worth.

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Stop

They do know...

The individual companies do know, but part of the agreement is that they are not allowed to talk about the deal, which includes which patents they are infringing.

This is, unfortunately, standard practice in the legal industry.

It is frustrating for those of us on the outside, looking in. But those involved generally know exactly what is at stake.

Generally, you can include: FAT/FAT32 driver, electronics and software for reading battery level and signal strength and a few others. They aren't all software, some involve some hardware components. But the exact list of what Samsung will have to pay for is, unfortunately, between Microsoft and Samsung.

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Anonymous Coward

Because it wasn't decided on the basis of whether or not MS was wrong,

it was decided on the basis of "It will cost X to defend and Y to pay, and Y is cheaper than X by a factor of 200. So we pay instead of defend."

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Boffin

Heads I win, tails you lose!

...gotta love it!

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Anonymous Coward

Kill them all!

How is this different from feudalism? Weak central government, local barons making their own rules to exert arbitrary taxes on the rest of us?

No Microsoft taxation without representation, that's what I say.

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Silver badge

Well...

Actually you need to hire the government and its army of tax feeders to make the patents stick.

So "weak central government" would actually be a plus. Actually it's a plus in any case.

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Anonymous Coward

And to think that libertarian nutcases like Congressman Ron Paul think that if we take away the remaining regulation on these corporations that this will make them behave ethically.

I'm not sure whether these people are truly deluded or they think the voters are so stupid they will accept anything that means less government.

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Paris Hilton

A congressman thinking, don't be silly, they only think what they are told to think by lobbyists making "political donations"

Terminator icon, the other great free thinker

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Patent royalties are essentially $444m in profit, not revenue, and come from doing absolutely nothing. It's less of a drop in the ocean when you compare like for like...

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Meh

That's assuming patent lawyers are free. I'd think it's fairly safe to assume they're not.

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..and assuming it cost zero to create the technology in the patents.

I'm betting you don't work in management accounting..

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Silver badge
Unhappy

Stand and deliver!

The point here is where does all that lovely money come from?

Indirectly from the end-user, that's who.

You don't for a minute think that the likes of HTC or Samsung will fail to pass the added cost onto their customers, do you? No, this is a shakedown of biblical proportions and I can't for the life of me see who is going to stop it.

Google? Maybe, as although they make no money from Android itself they are being squeezed by the fact that MS is making the Android ecosystem less attractive by increasing costs and thereby slowing down Google's ad revenue, but I won't be holding my breath.

Motorola, that's debateable, as they seem to be a bit short of cash just now.

Other than those two who has the resources and motivation to put a stop to this appalling highway robbery?

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Alien

threat or offer disguised as threat?

My guess is that there is cross-licensing going on. The patents may be rubbish but there's probably something else (exchange integration, skype maybe) on offer so they just issue each other with an invoice and a credit note. Hence why the big players have fallen into line. Surely there has to be more than "we won't sue you" on offer.

Here's waiting to see if Motorola ever gets a knock from MS's lawyers. My guess is that they won't because that would reveal the patents to google. However, skype will disappear from the android store so they'll have to pay and pre-install skype and an exchange connector or sign a linux patent deal and an nda.

Perhaps skype could pay for itself, in maintaining linux FUD and cross-licensing deals which lock out the smaller players who might be gunning for MS' third position.

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Linux

Pure mobisoft behaviorism

Nice little handset you got there... too bad if something were to happen to it.

Oh you want to use something closely related to Linux. It does not matter we have nothing to do with your Android/Linux... but if you don't want our goons... er, jackboots... er, enforcers to work you over we suggest you pay up. We are top dog and you had better bow down to our overwhelming power. And you thought we were just going to go away quietly... Steve-o has a bat pounding on the chair over there... and he is not happy with you moving in on our planet.

Now pay us before we get mad and rub you into the pavement.

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Linux

dont think for a second this is a one way street.....

Im sure Samsung, HTC etc have a very large patent warchest. I also know there is no point using them back at Microsoft when they've only shifted a dozen or so handsets. They will wait for them to amass a decent market share (they will be in for a long wait) and then go for the jugular. At that point they can set their patent infringement price at whatever they wish and essentially kill them. Remember Ms actually have a different problem, everybody else makes their hardware so that's difficult to fight. But they make the os, so once you nail them on a o/s point you get all handset royalties in a single blow. I think this is going to be a very interesting fight and I for one am going to get a pack of beer, some peanuts and watch it kick off.

For what its worth I personally think Ms will win in the short term battles but will fail to win the war.

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Paris Hilton

wait... what?

i've read nothing about Microsoft taking companies that make andriod devices to court over patents, where the hell did this come from?

Was this all done under the table without any court rulings? if so, i'd like to say to apple "hey guys, look at that! there's another way of going about things"

i hardly believe that'll be the case though, weird.....

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Bronze badge

TomTom

It wan't Android but MS did sue TomTom for their use of Linux

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Silver badge

Patents for what technology exactly ?

I don't think that MS has yet said what the patents are in spite of having been asked over many years. The only one that we know about is for the FAT file system. If they don't say what the others are then how does this differ from bully boy extortion ?

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Linux

good question... it seems nobody knows what are those patents... I find it a bit weird, it means there was no leaks about this. I

'm really curious about this. Shouldn't it be possible to have an open-source alternative to those patents ? Are common Linux distros like ubuntu or redhat threatened too ?

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Bronze badge
Facepalm

Seriously, I mean if they just simply "lifted" the code to reading FAT/FAT32 filesystems or whatever it is, it seems trivial how to solve it, just hire a new programmer to write a new one from scratch. I mean, don't they have armies of programmers working at Google?

Hell they could post a "Reward" for a replacement to be written by someone on their homepage, and make the stipulation be that the winner be released to the world as open source.

Patents were never about "it does this", they were about "how it does this exactly", there are many ways to do things, and if there isn't, then it shouldn't be able to be patented, due to being too obvious.

It seems like it should be "You got us, we lifted the code, here is our one time big fine, and the next patch update will push 'our' code in place of yours." Not this, "You used a tiny piece of our code, to give our customers better connectivity with your product, now pay us forever and until the end of time."

I mean come on Google, spend the money and write some open-source code for the code Microsoft claims is theirs, and then tell them to STFU.

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Meh

Disappointing move from MS - I had thought they'd gotten past that kind of evilness to an extent. Still at least they have come to an agreement rather than simply throwing their toys out of the pram and trying to get the products banned.

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Anonymous Coward

Where is Wilkileaks when you need them?

To let the world + dog know what these supposed infringements are!

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Anonymous Coward

Terms of NDAs, exact licensing terms, costs and "rebates" would also be a nice addition...

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My Samsung TV uses FAT32 as well, do the payments go beyond just phones?

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"Is'nt this the case where m$ claim that linux infringes their patents"

I thought it was because of the use of things like FAT32 for storage and anything else that makes the devices play nice with Windows out of the box.

For me that would still be worth an extra ten dollah.

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Anonymous Coward

Anyone know where you can buy a windows 7 phone on the High Street?

me either, we walked round every store asking too...

M$ should probably be spending the money trying to get people to take up the phones...

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Holmes

"the mathematics used in the calculations were Goldman’s own"

So they patented some special new operation on numbers, and didn't licence it to MicroS**t? Lemmeguess, it's a function that blows up small numbers to very very big?

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FAIL

Karma will get them

The amount of money is small, does anyone think this will provide a useful revenue to MS? Will it even provide enough of a disincentive to use Android such that it makes Windows phone an attractive proposition?

It looks like a fairly desperate attempt by MS, it won't achieve anything positive for them.

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Silver badge
Meh

What the FAT???

You'd think $444m would be enough to fund some kind of clean-room re-engineering of the components in question.

I've never actually written a filesystem, so I could be wrong, but I don't imagine FAT would be too hard to emulate. It is, after all, about a quarter of a century old, and it wasn't exactly bleeding-edge when it was new.

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Anonymous Coward

Impossible

It is impossible to implement a filesystem which uses patented 'technologies' without falling foul of the patents, by definition. This is also the reason that keeps native zfs away from linux, even though the code itself was open sourced.

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Jad
Unhappy

RE: What the FAT???

Re-engineering of FAT isn't the issue, because the FAT Linux uses was never created by Microsoft, they built a working model from the specification ...

as it happens it isn't even FAT that they have problems with, it's not FAT16, or FAT32, but the ability to talk both at the same time.

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Meh

It's about image

I believe this is more about scaring corporate IT away than the money they net from the royalties. It's part of their quest to make people not to want to adopt anything Linux based out of fear of instability in the platform.

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Thumb Down

Is it the same Government Sachs scum...

...who "calculated" all the derivatives etc 'oh-so-well...? Pleahhse.

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Silver badge

think again,

They got their share right off the top.

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