back to article Microsoft-Motorola patent row: Google wants $4 BEELLION a year

Google has suggested that Microsoft should pay around $4bn a year for the wireless and video patents of Motorola that Redmond uses in its Xbox and Surface fondleslab. An expert witness at the trial, originally between Microsoft and Motorola but now including new Motorola Mobility owner Google, testified that Microsoft would …

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  1. EvilGav 1
    WTF?

    Wireless

    Assuming that patent makes up part of the wi-fi standard and for some reason isn't covered by FRAND, MS seem to be suggesting that the patent is worth (annually) $0.01 per xbox sold (having sold around 100 million).

    1. AndyS

      Re: Wireless

      By that calculation, Google reckons it is worth $40 per xbox.

      Both figures seem a bit extreme, really. It'll be interesting to see what the judge thinks.

    2. Anonymous Coward
      Anonymous Coward

      Re: Wireless

      "Assuming that patent makes up part of the wi-fi standard and for some reason isn't covered by FRAND, "

      It's all FRAND.

      1. eulampios

        Re: Wireless

        FRAND != FREE or SUPERCHEAP, whatever MS and Apple might think. That is the sword they live by, why to be so scare of it now?

        1. Anonymous Coward
          Anonymous Coward

          @eulampios

          Actually, there are caps to the amount of money the grantee of a FRAND license has to pay. So, yes, "FRAND" really does mean "super-cheap".

          1. eulampios

            @AC

            tell to the Redmond lawyers, they kind'a assume zero and continue not to pay ANYTHING. Don't know much specifics of the MS vs Moto case here, however, Apple vs Moto, Google offers all-patent for all-patents aut nihil deal. Otherwise, the thermonuclear war must go on.

  2. James Gosling
    Facepalm

    Surely...

    If you are going to negotiate a price for licensing intellectual property it would make sense to do that before adopting it and shipping it in your products, otherwise surely you are over a barrel. Personally I hope Google get enough money to give Steve Ballmer a nose bleed!

    1. Anonymous Coward
      Anonymous Coward

      Re: Surely...

      Except consumers will be the ones who end up paying... still as happy?

    2. Anonymous Coward
      Anonymous Coward

      Re: Surely...

      Then again, Google simply bought these patents, making them little more than your run-of-the-mill patent troll

      1. g e
        Holmes

        Google being a troll

        Something Microsoft would never do over something like maybe Android phones with mystery IP in them.

        I wonder if they make around $4Bn a year from that trolling they'd never do.

        1. eulampios

          Re: Google being a troll

          A troll trolling another troll is not a troll after all. Don't you get that?

          1. h4rm0ny

            Re: Google being a troll

            "A troll trolling another troll is not a troll after all. Don't you get that?"

            Well you can say that but what makes it true? If I say a throwing excrement at another person throwing excrement is not actually throwing excrement, would that suddenly be a true statement? It's just more excrement even if you choose to support one of the parties throwing it.

            1. eulampios

              Re: Google being a troll

              let there be no "excrement throwing' at all or every thrower should expect some excrement on his/her face. Some really bad excrement on the face of MS, Apple and Oracle is the only means to make them refrain from throwing excrement on the faces of others. Making the latter three eat the excrement of their own might even further expedite the advent of an excrement-free world.

              1. h4rm0ny

                Re: Google being a troll

                Wow. You've really misunderstood the point of the analogy. So you now agree that both sides are engaged in the same activity?

                As to the Eye for an Eye approach you advocate of punitive charges, that just creates a barrier to entry for any new players and entrenches the existing big players, because costs rise and outside players can't break in any more. Some of us would prefer the market to stay open and competitve, rather than seeing huge fees charged for licences because big players want to punish each other, as you say they should.

                1. eulampios

                  @h4rm0ny

                  No, it's you that misunderstand it. MS, Apple are sighted routinely resorting to using the muddy patent system. In this pretty unfair and hypocrite world where you can patent "rounded corners", "long exFAT filenames " and other obvious stuff and then extort millions or even billions with them from more successful competitors, why get even more hypocritical to now call for the true Christian, a la Leo Tolstoy's behavior? Remember MS to shamelessly approach Android manufacturers, smaller companies most of the time, and extort money from them? Only one stood up and ... got 300 million of investments

                  Both MS and Apple have the Google's offer on their plate to stop all those wars at once and negotiate about all WMA at their hands.

                  1. h4rm0ny

                    Re: @h4rm0ny

                    "No, it's you that misunderstand it."

                    Let's demonstrate. You wrote that someone (patent) trolling another party that was (patent) trolling, is not trollnig them. I disagree. I say that this is now clearly two people indulding in patent trolling. I tried to convey this to you in a more colourful way, hoping to show how illogical your statement was, by likening it to one person throwing excrement at another person who is also throwing excrement. The fact that one is already doing so doesn't make the latter not doing so. It's just two people throwing excrement.

                    You then responded with a reply saying it was okay for the second party to indulge in this behaviour. I never said anything about justification. I just said it was ridiculous for you to say that they weren't indulging in that behaviour.

                    And as your second post was a longish justification for why they should indulge in that behaviour, it seems you have now conceded that they are.

                    "Remember MS to shamelessly approach Android manufacturers, smaller companies most of the time, and extort money from them?"

                    What was the money wanted in exchange for?

                    1. eulampios

                      Re: @h4rm0ny

                      You pretend not getting, do you. The whole idea of Google using Moto's patents is to MAKE MS and Apple stop their aggression. As I said before and you can read in the docs Google wrote to Apple, the offer is "I stop all of my attacks if you stop all of yours. Period". No, both Apple and MS want to continue with the situation where they set higher prices on their crappy obvious patents and really low prices on the non-so-obvious FRAND patents of Moto's.

                      "Eye for an eye" is translated for you into "you touch my own or any of my friend's eye, I'll poke yours and kick you in the groin and rip your ear, or punch you in the face, so you don't engage in this risky business" And this is totally justified

                      1. This post has been deleted by its author

                      2. h4rm0ny

                        Re: @h4rm0ny

                        "You pretend not getting, do you. The whole idea of Google using Moto's patents is to MAKE MS and Apple stop their aggression. "

                        I'm not pretending anything. I simply believe that if Google saw the opportunity to sting MS for $4bn they'd try to get that money regardless of any good faith action on MS's part. That's just business. Can you honestly see the board of Google saying to their shareholders: "we passed over this $4bn opportunity because we think MS are okay." They are rivals. They fight. You suggest that Google would be happy to accept free use of MS's patents in exchange for free use of their patents and think that it's wrong of MS to not agree to this. But do you know what MS patents are worth and what they are? No you do not. So how can you say that it is fair to do a straight swap? Do you think sueing someone for patent infringement is intrinsically wrong? If so, then Google are doing something wrong by you. If not, then what are your reasons for condemning MS for charging Google for use of theirs in the first place?

                        "Eye for an eye" is translated for you into "you touch my own or any of my friend's eye, I'll poke yours and kick you in the groin and rip your ear, or punch you in the face, so you don't engage in this risky business" And this is totally justified

                        I'm not sure which is supposed to be which party in the above. But your confidence in knowning how much the relevant patents held by each side are worth in dollars (worth translates into how much injury is inflicted in your analogy) seems unwarranted to me - unless you happen to have a lot of knowledge that the rest of us don't? We know how much MS are charging Google so we can put a value on that. We don't know how much Google's are worth, because this hasn't been settled or gone through court. We just know how much Google claim they're worth. And Google are no less unbiased in this matter than you are.

                        1. Bob Vistakin
                          Holmes

                          Re: @h4rm0ny

                          " I simply believe that if Google saw the opportunity to sting MS for $4bn they'd try to get that money regardless of any good faith action on MS's part. That's just business. "

                          Can you point to an instance where Google has done this, or something similar, before please? It must be someone neutral they have done it to, other than as a defensive move reacting to aggression the other party instigated,, so don't point to the current Motorola spat.

      2. Anonymous Coward
        Anonymous Coward

        Re: Surely...

        Too right. It seems patents are like investments which you buy hoping to make a return on. They're not the protection of ideas for the start up companies that they were intended to be.

    3. johnnymotel
      Stop

      Re: Surely...

      isn't this the case where Moto specifically excluded MS & Apple in their contracts with the likes of Qualcomm who happen to make the chips that go in the Xbox or Apple products? So instead of getting patent exhaustion via the chip licence, Moto wants to pursue this avenue of making a high claim on what was a FRAND patent. In other words, if you're a small fry you get patent exhaustion rights, if you're a big fish you gotta pay way over the odds.

      Seems patently unfair business practice to my eyes.

  3. dogged
    WTF?

    H.264?

    I thought that was part of MPEG-LA, which includes both MS and Apple (although not Google).

    Still, presumably if H.264 is owned by Google and worth 4 billion a year, El Goog will be happy to pay an equal amount for MPEG-LA licensed patents, no?

    1. Oninoshiko
      Boffin

      Re: H.264?

      from MPEG-LA:

      "Q: Are all AVC essential patents included?

      A: No assurance is or can be made that the License includes every essential patent. The purpose of the License is to offer a convenient licensing alternative to everyone on the same terms and to include as much essential intellectual property as possible for their convenience. Participation in the License is voluntary on the part of essential patent holders, however."

      http://www.mpegla.com/main/programs/AVC/Pages/FAQ.aspx

      So MPEG-LA covers SOME of the patents required, maybe even most of the patents required, they make no representation that they cover ALL the patents required.

      Google, Inc. is an MPEG-LA licensee, but their rate cannot be increased by more then 10% per renewal.

      http://www.mpegla.com/main/programs/AVC/Pages/Licensees.aspx

      FACTS, aren't they fun?

      1. dogged
        Pirate

        Re: H.264?

        So what exactly are you getting at here?

        Are you saying that Googorola own a part of H.264 and can charge what they like for it to whomever they please but that MPEG-LA cannot charge Google any more (rising by 10%pa) for use of the other 99% of the standard?

        Wow, that sounds fair, reasonable and non-discriminatory.

        1. Oninoshiko

          FRAND may not apply.

          GOOG is not a MPEG-LA licensor, so their patents are not part of the pool.

          GOOG IS a licensee of the other MPEG-LA patents, and the contract GOOG has says the rate cannot be increased by more then 10% each renewal (as all MPEG-LA contracts do).

          That is all I said, I made no judgment on the "fairness" of it. As to FRAND, it's likely that neither GOOG nor Motorola where part of the any of the 4 working groups that jointly developed the standard, and therefor are not subject to FRAND terms on their patents (without knowing more then this article provides, I can't really check).

          That said, I can only assume AAPL already licensed the patents in question, as I cannot imagine GOOG missing the chance to go after them.

          1. Joseph Lord

            Re: FRAND may not apply.

            I'm pretty sure Moto were involved in the standardisation. They were/are pretty big in STBs and they might even have encoders. I'm not aware of them claiming they are not bound by FRAND commitments just that they are so loose they don't impose much restriction.

            Also if you have relevant patents it makes sense to be involved and to get them into the standard so that you can collect licensing fees which even at super-cheap FRAND rates are more than you can get if no one uses the tech.

  4. Bob Vistakin
    Holmes

    Ain't payback a bitch.

    Extortionate?

    "The $5 per Android handset they swiped from us set the bar, m'lud. Now we expect a similarly ridiculous figure in return."

    1. This post has been deleted by its author

    2. toadwarrior

      Re: Ain't payback a bitch.

      Re: Ain't payback a bitch.

      I doubt MS had frand patents so they can ask what they want. Motorola probably have frand patents in this instance so they can't. Even a child should be able to figure out the difference.

    3. Anonymous Coward
      Anonymous Coward

      Re: Ain't payback a bitch.

      This now means Android fans can't moan about Microsoft's extortion :) time to shut up fandroids.

  5. Steve Todd
    Stop

    MPEG-LA charge companies a maximum of $6.5M per year to use virtually all of the H.264 patents

    Where on earth do Google get these numbers from, and how can they justify them as FRAND?

  6. Anonymous Coward
    Anonymous Coward

    Makes Apple look reasonable.

    1. Law
      Coffee/keyboard

      "Makes Apple look reasonable"

      You shut your filthy mouth this instant, before I wash it out with soap! :(

    2. eulampios

      going thermonucliar is not a going for a walk

      there is some (collateral) damage to be done

  7. chiller

    Can somebody stop the world please, I want to get off.

  8. Chicken Marengo
    Mushroom

    Careful what you wish for Google

    Given that everyone in the tech industry now seems to be infringing dozens of the patents of everybody else, all these companies should surely be trying to tone it down a bit?

    If Google gets awarded $4gazillion a year then Microsoft is going to be looking to get that back pretty damn quick and is likely to go nuclear with it's arsenal and you can be pretty sure that the Choccy Factory is infringing a few of them.

    This in turn will prompt desperate retaliatory actions from others.

    It's all starting to look a bit Dr Strangelove. I was thinking that maybe this is what the patent system needs, but the only people left standing at the end will be the lawyers.

  9. Anonymous Coward
    Anonymous Coward

    Oh I see

    I get how this works now -

    Apple sue anyone - apple evil

    Microsoft sue anyone - Microsoft evil

    Google sue Microsoft - go google!

    1. Bob Vistakin
      WTF?

      Re: Oh I see

      Correct, because it happened in that order.

      1. h4rm0ny

        Re: Oh I see

        "Correct, because it happened in that order"

        Well if it's a play-ground case of "Who Started It" then presumably you have to add Google infringing on MS's patents as a prior step to MS asking them for money. Because if Google didn't, then MS wouldn't be able to do so.

        But really, I don't think big business quite works on the principle of who started it. If a big business sees a rival to themselves - whether that's MS looking at Google or Google looking at MS, and they then see an opportunity to get money from that rival, then they take that opportunity.

        Does anyone really think that if Google had the opportunity to sue MS for US$4bn and MS hadn't been charging them licence fees, the Google board would sit there and say "oh let's not sue MS for money for our patents, we kind of like them."

        1. Ben Tasker

          Re: Oh I see

          But really, I don't think big business quite works on the principle of who started it.

          Latest on GrokLaw: Apple files motion under rule 34 - "I'm the king of the castle......"

          Could make for more entertaining litigation, but yeah as you say this is not how business works. You can't defend infringement by saying "they infringed first". From a business sense, you can do something similar which is offset your loss by claiming for their infringement though.

          The idea of "They sued/infringed first" is a symptom of the sickening PR games that big companies play now when entering into Litigation. Rather than seeing a simple "Apple sues Samsung" news story, we see PR releases from both sides stating far more than the facts (in a provable) sense of the case.

          Does anyone really think that if Google had the opportunity to sue MS for US$4bn and MS hadn't been charging them licence fees, the Google board would sit there and say "oh let's not sue MS for money for our patents, we kind of like them."

          Being that it's patents, I can see the above if you change the end to "we may be able to use it as leverage, and the longer we leave it the greater the damage"

      2. toadwarrior
        Facepalm

        Re: Oh I see

        Stalin is ok because Hitler did it first.

    2. Colin Wilson 2

      Re: Oh I see

      "In December 1970 Dirk sued Stig and Nasty, Barry sued Dirk, Nasty sued Stig and Barry, and Stig sued himself accidently. It was the end of a golden era, and the beginning of another one for lawyers everywhere."

      I knew I'd seen all this before!

  10. Ted Treen
    WTF?

    @Chicken Marengo

    I suppose it's just (but ONLY just) possible that a few are going to ridiculous extremes to bring things to a head, so patent law is overhauled, being totally unfit for purpose in the US of A, and not a lot better in most other places.

    Furthermore, we could all indulge in a little schadenfreude at the sight of hordes of laid-off or skint patent lawyers signing on for unemployment benefits, or retraining as Burger servers, parking attendants etc. - the brighter ones, that is.

    1. Chicken Marengo
      Alert

      Re: @Chicken Marengo

      The thought of a patent lawyer serving my food or parking my car terrifies me

  11. auburnman
    Meh

    It's like lunchtime at the playground

    Google and Microsoft have swapped round, it's now Google's turn to be the baddie and Microsoft gets to play the goodie for a change. Highly amusing even if it is lining the pockets of the legal elite and holding back tech development.

    1. eulampios

      @auburnman

      Let's see here, one (or two-three, MS and Apple and Oracle) kids bullying other kids. They'd approach a kid kicking, punching him/her in the face behaving pretty aggressively, yet cowardly by attacking younger and smaller kids. Sure, it's all done, when gown-ups are not looking. Things change now, a kiddie matching our bullies strength-wise shows up and after getting the first kicks, punches and bitings gets the technique and starts chasing our good ol' bullies to kick, punch ... Go harder, kiddie!

      It is fun watching it, isn't it?

      1. h4rm0ny

        Re: @auburnman

        "It is fun watching it, isn't it?"

        Uh no, not really. Big players charging each other fortunes means more expensive products for the rest of us.

  12. Robert E A Harvey

    Google wants $4B a year

    Of course they do.

    So do I

    I'm not going to get mine.

    They aren't going to get theirs.

    Carry on, world.

  13. Robert E A Harvey
    Unhappy

    I don't like this story.

    I can't decide which side I loathe.

    1. Martin 47

      Re: I don't like this story.

      Happily I am not particularly keen on either company

    2. Hardcastle the ancient

      subtle

      re-used posting makes clever link to other story. Snide.

  14. billium
    Mushroom

    The lawyers are the winners, and we all pay.

    Android users don't get their $5 back and the 235 patents are still not revealed.

    But I hope Google beat the vile monopolist.

    1. dogged

      You hope the desktop monopolist gets beaten by the advertising monopolist?

      1. Robert Grant
        Happy

        "You hope the desktop monopolist gets beaten by the advertising monopolist?"

        Of course. Otherwise the wrong lizard might get in

  15. Anonymous Coward
    FAIL

    With apologies to the J. Geils Band.....

    You sue her....

    And she sues him....

    And he sues somebody else....

    We just can't win!!

    And so it goes until the day we die....

    This thing we call IP is gonna' make us cry!!

    (And please don't sue me for this parody!!)

  16. MissingSecurity

    I apparently need a better calculator...

    Cause mine doesn't come with a BS function..

  17. Anonymous Coward
    Anonymous Coward

    Lay off the crack pipe

    Fandroids and Gigglerolla Pom Pom girls...

    1. Ben Tasker
      Joke

      Re: Lay off the crack pipe

      Gigglerolla Pom Pom Girls

      Pics or it didn't happen

  18. Anonymous Coward
    Anonymous Coward

    4 Beeelion???!

    Thank god google has stopped it's silly shenanigans of monetary figures based on Pi and other nonsense.

  19. Herby

    Microsoft V. Google is like

    (Sorry for invoking Godwin's Law) Hitler V. Stalin. You really want both of them to lose, so you don't know who to really root for.

    The best possible outcome for this is to have "method patents" disallowed. Then we can all go home and worry about more pressing issues.

    1. h4rm0ny

      Re: Microsoft V. Google is like

      "The best possible outcome for this is to have "method patents" disallowed. Then we can all go home and worry about more pressing issues"

      I agree in a lot of cases. But some method patents are valid. Or at least it's a supportable argument that they are. In this case we're talking about video encoding. A great deal or work, imagination and cleverness can go into working out a new way of compressing images into video - thinking of ways that you can record only changes between two images for example. MPEG-4 has methods by which it checks forward and backward to reference frames, adjusts for motion blur and all kinds of things. It's a lot of work. And yet when that work is done, you could independently implement it relatively easily in different languages or platforms. Should the people who worked hard on developing those solutions not be recompensed because copyright does not cover it?

      1. Vic

        Re: Microsoft V. Google is like

        > But some method patents are valid.

        I don't see many fitting into that category...

        > A great deal or work, imagination and cleverness can go into working out a new way of compressing images

        It can do, but most of that is grunt work; working out how to tune well-known algorithms to fit the sort of sequence you are expecting.

        > MPEG-4 has methods by which it checks forward and backward to reference frames

        So do most video compressors. That was old hat when I got into the industry. Even if it were patentable originally, that ship has long sailed.

        > It's a lot of work.

        It is[1]. But it's not a lot of *invention*. And patents cover invention, not sweat-of-the-brow labour.

        > Should the people who worked hard on developing those solutions not be recompensed

        They *are* being recompensed; the purpose of these standards is to sell encoding and decoding equipment. Standards are required to ensure that the market for such devices exists.

        If I lay a road, that's a lot of work. Should you have to pay me for every journey you make over that road?

        Vic.

        [1] I did a fair amount of that work...

    2. Hardcastle the ancient

      Godwin? are you sure?

      I thought Stalin cancelled Hitler, leaving a null result?

  20. Anonymous Coward
    Anonymous Coward

    1. Google get awarded X for their patents

    2. Microsoft counter-sue and get awarded Y for their patents (where Y is remarkably close to X)

    3. Microsoft and Google end up paying pittances to each other since X and Y more less cancel each other out

    4. Any new comer would have to pay X to google and Y to Microsoft...endgame

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