back to article Has Google wasted $12bn on a dud patent poker-chip?

It's all about patents, says Google co-founder and CEO Larry Page. Google insists that it bought Motorola to shore up its Android platform, which is caught in a litigious pincer movement from old buddies Steve Jobs and Larry Ellison. Microsoft is merely egging them on the sidelines as the manbags fly, shouting: "Fight!" But …

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  1. hahnchen

    Nokia came out with ongoing royalties, not just a one off payment

    Not just a one off payment as Orlowski suggests.

    http://fosspatents.blogspot.com/2011/06/apple-and-nokia-settle-patent-dispute.html

    I think Google overpaid for Motorola, but I don't think it's a dud. Get the patents, get a skunkworks, sell the manufacturing to an Asian firm who actually knows how to do it.

  2. Anonymous Coward
    Stop

    on UI programming languages

    Q: Why not use Go, the language Ken Thompson helped develop?

    A: Because Go sucks at anything remotely practical or usable.

  3. Steve Davies 3 Silver badge
    WTF?

    Look at the timeline

    11/12th Aug - Moto announces that it is going to seek license fees from other android vendors (HTC, Samsung etc)

    14/15th Aug - Google announces that it is going to buy Moto.

    So did Moto make that announcement in the full knowledge that Google was doing due-diligence on the purchase?

    If I were the SEC I'd look at that very carefully.

    If there was nothing more than a punt to the world, 'look at me I'm being a complete <redacted>. Come and buy me NOW!' then that says everything about Moto. Another maker I'll be glad to see the back of.

  4. Mark Jonson
    Thumb Up

    Bingo!

    The real reason for this purchase, aside from the supposed patent rights that are begin acquired, is a result of Moto being in fiscal crises for years. Their fledgling mobile business isn't earning any profit. But they knew they had a treasure trove of patents that could be used to infuse some cash into the company. Moto was probably getting ready to sue the pants off of other Android OEMs, over patents similar in nature to those upon which Microsoft and Apple are claiming violations. If Motorola ended up being successful in getting injunctions or large payouts from even some of the OEMs, the entire Android OEM ecosystem would turn into a dog-eat-dog world, with patent-holding OEMs cannibalizing those who could not defend themselves.

    Google couldn't have that if they are to sustain and grow their 40+% market share, so they had to do something. By buying MMI, they are taking control of the patents, and thus preventing Android OEMs from being sued over them, while concurrently ensuring that Android will be protected from litigation regarding anything in Motorola's patent drawer.

  5. Neill Mitchell

    Small change?

    "Nokia barely came out ahead, with a one-off payment of €430m."

    It just goes to show how blasé private equity buyouts and the banking crisis has made us about huge numbers when €430m is considered "barely ahead". How depressing.

  6. Jemma Silver badge
    Childcatcher

    IIRC

    It wasnt just the one off payment to Nokia, wasnt there talk of some per unit google-thumping involved?

    Id actually be more concerned if Android was a credible competitor. Ive had three Android handsets and they were up and down like an Essex Girls undies (I am from Essex so I am entirely entitled to say that) not to mention zero signal and dodgy apps. Oddly enough when I booted the Diamond into WinMo - a miracle, a good steady signal.

    Not to mention the smartphone sales tables that suddenly lose 20% because that would mean showing people buy symbian.

    90% of people buy on looks alone. A neighbour of mine just realised shes got a powerful Symbian smartphone in her pocket, the 6700s... I got it because it was pretty and I liked the colour. Alot of people are like that, they've no idea what theyve got in their hands.

    As to all this patent palaver... I dont think so...

    Why buy a phone manufacturer thats effectively second string? They have the clout to buy HTC or even divest Samsung of their phone division. So why Motorola?

    Simples...

    Google as of now cannot make their own phones in house, with Moto they will be able to. Which means Moogle completely thrash the rest of the android ecosystem. Want a phone where updates to the hour are guaranteed..? Moogle Want to be (as much as you can be) sure that it wont crash? Moogle Get the Firmware updates first every time? Yup you guessed it...

    Samsung and HTC execs must be looking for someone to kill right now... And I wouldnt blame them in the least. This must have them fuming. All the work thats been put into Sense and TouchWTF and this is how Google repay them? Happy about this not are we...

    All this patent stuff is window dressing by Google in the hopes that their 'partners' wont twig whats happening and come after Googles happy sacs with large steel toecaps.

  7. Danny 14 Silver badge
    Go

    indeed

    ive been saying this for years but generally get voted down or laughed at. My samsung omnias have been venerable workhorses. Not the fastest but they work. My HTC HD is a cracking faster phone with more versitility but it doesnt work 100%. bluetooth in the car is hit and miss - sometimes needs a reboot to work. Occasionally loses signal for no reason - same with webaccess. Dont get me started on the 3g/hsdpa pingpong. Battery life is shocking on every android device ive used (from the Tmobile original jobbie, gw620, hd, Z and now a galaxy S2).

    winmo has its uses still. shame it has been canned.

  8. amanfromearth
    Joke

    It's not Mootle

    It's Googorola

  9. Anonymous Coward
    Facepalm

    Pending Patents

    It more about 7,500 pending patents.

  10. amck
    Facepalm

    Samsung, anyone?

    You seem to have forgotten Samsung's Galaxy Tab and the iPad front.

    Thats another battalion of Androids that needing reinforcing, from Googles POV.

  11. Anonymous Coward
    FAIL

    $12bn duck.

    $12bn duck - they would probably have been better buying Nokia - Motorola are already making Android handsets.

  12. Anonymous Coward
    Anonymous Coward

    $12B to Defend Andriod Makes Oracle Damage Claim Seems Reasonable

    Title says it all. If Google is willing to shell out $12B in the hope of defending Android, how can they then go to court and say that Oracle claim of a few Billion in damage is overstated.

    Big question that needs to be answered.

  13. Andrew Orlowski (Written by Reg staff)

    Re: $12B to Defend Andriod Makes Oracle Damage Claim Seems Reasonable

    +1

  14. M Gale

    Easy.

    $12bn on a boatload of patents is better than a few billion wasted on nothing. They'll always have those patents to wave around at any potential aggressors, regardless of the merits (or lack of) of Oracle's accusations.

    Really, the Cold War situation of software patents and "intellectual property" is pretty well known and you need to know why Google bought a load?

  15. Andy Jones

    Not really

    Paying $12b for Motorola's phone division means they are getting something in return. With regards the patents they can use these to protect themselves, and use the rest of the phone division how they wish.

    Oracle are asking for an exhorbitant amount in licensing fee's, even taking revenue into account in areas that are of no concern to the infringement (Googles advertising stream). Google disagrees with this amount, and disagrees with the patents and copyrights themselves, so obviously rather than pay up to an obvious troll they are fighting them and winning as well.

    It is quite simple really.

  16. Real Ale is Best
    Boffin

    You're assuming...

    You're assuming that this has anything to do with the Oracle lawsuit.

    Personally I think that Google is looking to defend itself against Apple and MS.

    Apple are suing phone manufacturers, henceforth they will now have to sue Google directly, as Google now manufacturers phones. Thus, Google can defend Android without having to intervene in Apple's (and MS's) lawsuits against HTC et al.

  17. Anonymous Coward
    IT Angle

    Re: $12B to Defend Andriod Makes Oracle Damage Claim Seems Reasonable

    "If Google is willing to shell out $12B in the hope of defending Android, how can they then go to court and say that Oracle claim of a few Billion in damage is overstated."

    Think of it this way: why would you go out and spend a lot of money on a very big television when you can pay someone not to steal the one you already have, and then pay his friend, and then his friend's friend, and so on?

    "Big question that needs to be answered."

    If you're a pundit who was caught on the wrong side of the clueline.

  18. MojoJojo

    Credibility

    ...sort of goes out the window when something like this is written:

    "Why not use Go, the language Ken Thompson helped develop? Or something like it? Or less ambitiously, why not use Gtk and build on it, much as Nokia did with Maemo/Meego? You may have heard of one or two of these."

    Go's entire reason for existence is for the cloud - high performance, concurrent stuff. Not a good match for mobile computing. And suggesting that a new language would have been better seems to ignore the key factor that determines a platforms success.

    Gtk's problems have already been mentioned.

    And finally, holding up Maemo/Meego as a success that google should have copied is just weird.

    Most of the article is good, but that paragraph undermines it's credibility.

  19. Andrew Orlowski (Written by Reg staff)

    Re: Credibility

    Fair point. Go isn't necessarily the best language for a mobile platform.

    But if you can hire the best, you have a great talent pool which can innovate. You don't need to copy. Google didn't innovate.

  20. Anonymous Coward
    Anonymous Coward

    NIH

    Google's strengths aren't with hardware design. Their engineers do software, and they do it pretty well* to the point of coming up with their own middleware and other reinvented tools. But hardware is a different game, a different mindset. Trying to reinvent the wheel there might very well prove more expensive than a couple mrd, though 12 would perhaps be stretching it. But it is worth noting that developing hardware is expensive, and the end of the day it matters little how you spend the money; all that matters is results. Anyhow. I don't think google needs moto for their software prowess.

    * Though their "search" appears to've been re-optimised for people with new kit, fast internet access and close-by googly server stacks, as it's getting very annoying to use their stuff on slow devices or wet-string connectivity. Yes, I've stopped using them (and others with the same ailment) because getting rid of "instant" is no longer an option.

  21. David Simpson 1
    FAIL

    iOS copy ?

    If anything Android's UI is more a copy of HTC's build of Windows Mobile, I know I used it quite alot (shudder) It's silly to claim Android's desktop UI is like iOS at all apart from a grid of icons.

    Google didn't copy Java's APIs they used what they though were open source Java code, Oracle's whole argument is about how Java ME is licensed and the fact that Google didn't want to hand string Android by using Java ME.

    A very poor collection of research (or lack there of) in this article.

  22. Goat Jam
    Headmaster

    wot?

    hand string?

    try "hamstring", as in "to cripple or ruin"

  23. gherone
    Megaphone

    Do not discount basic radio patents....

    There is a lot of IP in how to switch cell towers without dropping calls, how to keep the same audio level when you move around, and how to get around having multiple path for the same radio signal, not to mention antenna designs, variable power output amplifiers depending on distance and propagation to the nearest cell tower, power management in a portable transmitter, etc.

    Motorola has been totally inept in protecting its IP - years ago, when my team had clear infringing examples from another major company, corporate attorneys refused to take action because the infringing party was also a customer ("we do not sue our customers - end of story").

    There are a lot of patents and other IP owned by Motorola, and there are a lot more patents cross-licensed to Motorola over the years, which need to be examined before anybody can say if Google spent its money wisely or not.

    Six Sigma and its successors (Digital Six Sigma, Process Average Testing, Lean Manufacturing) were invented in Motorola - and there are patents associated with them. It is likely that most electronics manufacturers in the world today are infringing some process patent owned by Motorola, regardless of what product they are making.

    Do not confuse Motorola Mobility with a software or phone company - it has access to ALL old Motorola IP.

    Motorola IP covers from semiconductors (remember Freescale and OnSemi? Moto has rights to all their IP up to the separation moment and a lot of companies would love to make micros for the embedded market compatible with older Moto CPUs), to assembly and test process for high volume electronic products, to MEMS, to automotive sensors and modules, telematics, location technology (the Highway Intelligent Vehicle System was demonstrated before 1994 and is still in the Corporate museum in Schaumburg, IL, afaik - it was a turn by turn navigation system years ahead of its time or commercial GPS units), satellite and space technology (Iridium works, it was just too expensive, but the same technology can be used for regular communication satellites by companies with no IP in the area), not to mention the obvious areas related to handsets and cell tower communication protocols.

    It is true that Google needs some time and effort to fully understand and unlock the value of what they are buying, but please DO NOT sell short the value of Motorola IP.....

  24. ShelLuser
    Meh

    What amazes me..

    Back in the days we used to criticize Microsoft because they started out exactly the same. Copycatting. Taking some ideas here, taking some code there and mixing it all together to suit their needs. When it required a little more or they feared (?) the competition they'd simply buy the company and their technology to incorporate it with their own. Heck; sites like /. didn't start using a "'Borged' Gates icon" out of the blue...

    And here we are several years later. Now there's a new company slowly but steadily sliding down the exact same path as MS did. Yet you know what? They keep shouting "do no evil" and a majority seems to believe this because well; they said so, so it must be true. No, Microsoft; those are the /real/ bad guys. They have the monopoly; how many OS's are there?

    Wake up call: A lot right now! Ask yourself this: How many public internet search engines are left? How many available mobile ('cellular') OS's will be left? Where is the real monopoly now?

    And when are we ever going to see that "cool" Android source code?

    I have some very serious doubts here when you look at where this is all going.

  25. Anonymous Coward
    Anonymous Coward

    There's a difference here...

    ...in that the Chinese and Amazon can and will fork Android, and that you can quite legitimately emulate Android apps (as Blackberry will).

    The issue with Microsoft was that it always enforced proprietary standards to lock everyone in. Microsoft sued Tom Tom because they'd incorporated FAT32 into their devices just so it would work with the Windows monopoly! I don't see Google douching it up that badly.

  26. Danny 14 Silver badge
    Joke

    indeed

    cue "mars attacks"

    "do not run, we are your friends"

    dakka dakka dakka

  27. ShelLuser
    Stop

    Really?

    "We can fork it" has always been the number one argument in OSS yet when a situation arises it often turns out to be a whole lot more difficult.

    Yes you can copy it and make it your own (then again; you'd need access to the source code first) but then what? The last good example being OpenOffice. It was forked (Libre Office) but generally speaking that was merely possible because a lot of the original developers came along.

    We also saw the same thing going on with OpenSolaris, yet that didn't work out so well...

    Because of the Oracle oppression people also discussed forking of Java (the open parts anyway) and NetBeans. I've yet to see that happening.

    Forking sounds good, but in the end is often much harder than anticipated; in many cases seemingly impossible.

  28. Goat Jam
    Holmes

    Difficult to fork off?

    Not always, see XFree86 -> xorg

    Who uses Xfree86 these days?

  29. Graham Dawson

    "and the UI copies Apple's iPhone."

    I, er... what? The UI copies what? The iphone? How? The iphone UI is a touch-screen filled with little icons that you can, er, move around a bit. The Android UI is a touch-screen filled with a very flexible and configurable space for widgets, icons and all sorts of things. That counts as "copying"?

  30. Anonymous Coward
    FAIL

    Sorry, but

    HTC had similar UIs to the current crop of Android (in the form of TouchFlo) before the original iPhone was released...

    It's got a very familiar widgets and icons layout (which Apple still haven't got on the iPhone- just that stupid icon-grid thing that serves only to make all iPhones look the same), gesture control, multiple screens, etc.

    The only addition Apple made was to add multitouch, which is useful but doesn't add anything that wasn't handled with a few unobtrusive buttons at the bottom of the screen.

    Also, "Why didn't Google develop its own language and platform?" WHAT? You're seriously suggesting that rather than using what was basically Java (a well known, widely-taught, well community supported) language they should have just gone off and invented something else? Like what? What possible use could there have been for inventing their own programming language except to encourage an Apple-style vendor lock-in?

    I agree that they could have chosen a _different_ language, but then why would they? With the JIT compiler they've got no speed worries, it's not a particularly bulky language if you're bundling a load of resources with the OS, and again- Java has a massive community behind it, which means that Dalvik has a massive community behind it.

  31. henrydddd
    FAIL

    Down with patents

    These patent wars are getting so ridiculous that it is time to rethink the whole patent system.

  32. Charlie Clark Silver badge

    Compare and contrast

    How GSM became the world standard for mobile phones in no small part because it was largely developed by European companies (Ericsson, Nokia, Siemens, Alcatel) who knew, since the success of PAL for TV, that would have to work together as much as compete with each other.

    20 years later with the rise of the services based smartphones and, as has been noted in many places, American companies are better placed for their development. Suddenly, it's a no-holds-barred, winner-takes-all kind of thing.

    The comparison isn't 100 % accurate (Nortel and Motorola were on board early as everyone was scared by Qualcomm) but instructive. Will consumers really benefit from the incompatible silo approach that gave us PCS, IDeN, CDMA, etc?

  33. Richard Wharram

    I would suspect...

    That since Apple is suing phone makers using android rather than Google and bullying it's partners Google is trying to make the fight more even by forcing Apple to sue Google itself.

    With Google's money and lawyers they might even fight Apple's patents directly and get them invalidated, one by one.

    Maybe...

  34. Patrick O'Reilly

    Nubooglers

    From what I've seen of Google's newest recruits, they're all lawyers and beancounters. Not a chance they let this happen without there being a juicy steak at the end of it.

  35. Gideon 1

    Hobsons choice

    Either pay Apple and get nothing, or pay for Motorola and at least get something for your money.

  36. Lars Silver badge
    Happy

    You have to defend yourself

    Money is nice, but it can also make your cook to vibrant for your brains.

    Just remember Gates who decided he was actually the great inventor and decided to be The Great Chief of Innovation at Microsoft. He probably prevented any innovation to happen at Microsoft during all those years.

    Then we have Jobs who suddenly thinks he actually invented the phone and decides to sue Nokia.

    It must have been a real shock to Jobs and his lawyers to loose so totally against Nokia.

    Now Moto has been for sale a long time without, as I think, having interested Google at all.

    Surely the things related to Apple and Nokia/Microsoft must be the reason behind Googles sudden interest in buying Moto. Apple will have to think twice before suing Google in earnest.

    Microsoft will have to think twice too in case they intend to use Nokia's patents against Google.

    Rumours have it that Apple actually is paying Nokia for each Apple phone because of this vibrant cook of Jobs.

    True or not, that does not matter.

    The thing is that Moto and Nokia have been in the cell phone business from the start and both

    Apple and Microsoft are mere upstarts.

    (and now again I get these extra CR characters from somewhere without asking for them)

  37. Turtle

    $2.5bn Breakup Fee...

    Allow me to scoop the Reg here!

    According to http://fosspatents.blogspot.com/2011/08/25-billion-google-motorola-break-up-fee.html, Bloomberg reports that if the Google-Motorola deal falls through, Google must pay Motorola $2.5 billion.

    That's impressive!

  38. Dave 124
    Flame

    FUD Morons... Google Got the Crown Jewls

    Consider this. The crown jewels for modern phones is software defined radio. Imagine Apple getting cut off the knees by being sued over using software defined radio.... and that is what Google just got. Between the Moto purchase and the IBM transfer we can probably consider Oracle, Apple and Microsoft checkmated. Of course Microsoft funded analysts will still write stupid articles such as this to slow down Android but netizens have seen this playbook before!

  39. Anonymous Coward
    Anonymous Coward

    @Patrick O'Reilly

    Not just lawyers and accountants. They've been actively courting quite a few greybeards too.

    Anon, because I'm one of them.

  40. gruffrey

    Not Apple they were going to sue - it was other Android manufacturers

    As a previous poster pointed out, the reason they bought Moto was to stop them crippling other Android manufacturers. Patents are bargaining chips, Apple has lots so Moto couldn't make money from them - Apple would counterclaim until the result is a small (like Nokia) win for either with no major consequences.

    Other Android manufacturers don't have a bank of chips to bargain with like MS and Apple and were being eyed by Moto as a source of income. This had the potential of derailing Google's hope for the future growth of the platform. Again, fosspatents, written over the weekend just before the news:

    http://fosspatents.blogspot.com/2011/08/motorola-doesnt-have-license-to-kill.html

  41. OziWan
    Flame

    Well it's crunch time

    A group of you think that Google is evil and this justifies that opinion. Another group thinks that Google is not and this just proves it. Well this time we will know.

    I think they have gone for really low level patents to protect the handset makers but I have to admit (as others have pointed out) that the numbers do not add up and there must be something else at play here.... we will see!

    Flammable because this might turn really nasty.

  42. Steve Taylor 3
    Happy

    Let's dream up a new language!

    > Why didn't Google develop its own language and platform? The company is full of brilliant engineers, many of whom have mobile platform experience, and who have created some of the milestones in computer history. Why not use Go, the language Ken Thompson helped develop? Or something like it?

    Existing languages come with existing programmers. It's easier to get people to mopve to your platform if they use the skills they already have.

    There - now was that so hard?

  43. Anonymous Coward
    Anonymous Coward

    Why is Pi a silly number?

    I have read this a few times here on the reg, but last time I checked Pi was just a combination of ordinary digits like 3.000.000.000 or what ever number you like is...is there a list of silly numbers I can look up somewhere? Is an auction bid that can be cleanly divided by 3 more reasonable then one thats even?? If making an offer that resembles Pi is valid evidence to be considered being childish and imature what is the perception of Euler or Plank???

    Hopefully the author can shed some light on this matter...and provide some examples of hip and sensible numbers thus we all know what are safe bids for our next eBay auctions...nobody wants to feel emabarresed in front of tech journalists who might watch the auction, right? ;-)

  44. Francis Boyle Silver badge

    List of silly numbers

    It was probably on Wikipedia along with the list of inherently funny words (http://en.wikipedia.org/wiki/Funny_words) but I suspect they were both deleted probably due to el Reg calling Wikipedia silly.

  45. scarshapedstar
    Gimp

    Blah blah...

    "Android is a copycat platform. The APIs copy Java, and the UI copies Apple's iPhone"

    iOS is a copycat platform. The API copies Objective C, and the multitasking and status bar copy Android's.

  46. Anonymous Coward
    Trollface

    Know what would be really amusing?

    If Google gave a chunk of relevant patents to the OIN.

    "Hi, we believe Microsoft Windows infringes on 1,423 of our patents. No, we won't tell you which ones. If you don't want us suing you and your vendors, you can make regular cheques payable to us, the FSF, Apache foundation, Debian foundation, oh and Richard Stallman."

    I know, won't happen. But still, it's a really amusing thought.

  47. Mikel
    Go

    It will all be fine

    Let's not get our knickers in a twist. Moto needed a little help, and Google needed some patent mojo. Now together they can show AppleSoft their pimp hand, and we all get neat new Android stuff.

    Everybody's a winner.

  48. Anonymous Coward
    Meh

    Next Google will sue the Android handset makers.

    Next Google will sue the Android handset makers with it's new patent portfolio - HTC and Samsung etc. left out of the party.

  49. James Hughes 1

    What???

    That would be completely insane. Google need as a many Android handset out there as they can get - whoever makes them. Remember their main source of income - even owning Moto - it's still advertising.

    Sue the other Android makers and you simply reduce the total percentage market share of Android.

  50. Anonymous Coward
    Angel

    Outbid?

    Perhaps Apple should outbid Google and take control of the patents, get rid of a major Android manufacturer and have it's own manufacturing facility. With their other patents it could give Android a good kicking.

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