So how many phones might they owe upon that have already been produced, I wonder?
Apple is willing to pay to use Googorola's patented wireless technology - as long as it's no more than $1 per iPhone. The fruity firm made the offer in a filing to a Wisconsin court ahead of a patent licensing trial due to start next week. Google-owned Motorola Mobility is accused of breaking an agreement with Apple over the …
In best Violet Elizabeth voice "Make Mororola give it to me on my terms or I'll thcream and thcream 'till I'm thick".
Court to Apple "Of cource we will my dear" turns to Google (Just William) "All right you orrible little man give her what she wants, and don't you dare think of doing anything evil like appealing, couse you arn't and she is"......
Does anyone know the "normal" FRAND licensing is? I don't, and I used to work for Moto. All I heard was "piles of patents are balanced on scales, with the balance weight determining who pays whom", but no mention on how the value is determined.
Is it "normal" to charge a percentage of retail price, or percentage of the component value that incorporates the patents in question?
Yes, so the scales weighing documents determines who pays whom, and I can't believe that the scales would tip towards Moto paying Apple. But it's not a "minimal" amount - it's a "fair and reasonable" and one would think that within the 3GPP (and other standardisation bodies) arena there are a huge amount of (probably NDA'd) contractual agreements between the member companies of the standards body. All Moto would have to do is demonstrate that the "2.25% of retail price of the device" is within the realms of such figures.
Assuming they can, I suppose - although I would be surprised if they couldn't.
No one pays on retail price, imagine you have a $200 million boing planes, Motorola is saying that if Boing put's a single $5-8 chip in one of it's planes it would have to pay 2.25% of the sale price of the plane.
The licence amount varies by what is being licenced, some thing are fixed rate, firewire iirc was 25c per licence, others are a % of the component, memory chips are done that way since it's easy to work out the commodity price of memory. Then you get maximum costs, MPEG has a maximum that anyone company has to pay. After that it gets complex.
Remember the idea is to make a standard that will be widly used yet earn lots of money for the SEP holders. So you want the licence to be both cheap yet expensive and everyone want's their patents in a SEP pool while at the same time having as few other companies patents in the pool.
What you need to remember is Apple only made this offer to avoid an instant loss for wilfully ignoring the FRAND licensing procedure, which *requires* them to negotiate, then go to arbitration. Only then do they get to whine to a court.
Apple refused to negotiate at all and found a judge willing to just ignore all that but they need to cover their arses, by pretending to open negotiations.
Motorola have to offer Apple the same terms as everyone else, that why it's called "Fair, Reasonable, and Non-Discriminatory". It is Motorola that made the agreament, they have to live up to that. No negotiation is required because Motorola have a legal duty to offer Apple the same terms as everyone else.
As for the judge, well Motorola has so far lost in 7 different courts on 2 continents against both Apple and Microsoft over FRAND, how many more times does it have to lose before you start wondering if maybe it's not the courts that are acting illegaly but Motorola?
I suspect you neither understand FRAND or the games Apple are playing. Motorola made the same opening offer to Apple as everyone else. That's pretty fair and non-discriminatory by any standards.
What's supposed to happen then is Apple try to negotiate it down, both sides negotiate, if that fails it goes to binding arbitration and someone else decides what a fair price is. Apple skipped EVERY step of that process. Motorola completely lack any ability to force their choice of pricing under that procedure, they supply a starting price and negotiation skills but can't refuse to licence. But Apple didn't enter the FRAND process and arguably should gain no benefit from it now.
Motorola *look* like they're in trouble because Apple and Microsoft have influence and have whispered lies into the right ears. When it reaches impartial judges (which hasn't happened yet) the opinion of bought politicians and bureaucrats tends to lose effect.
Apple are playing a dirty and dangerous game and they're doing it because they have no negotiating power in SEP, owning bugger all essential patents. They aren't going to lower Motorola's initial offer much because they have very little to cross licence. That doesn't make the offer unfair, it simply reflects the value in the deal. Apple are in a weak negotiating position and desperate to bypass the process completely, was going to say 'by fair means or foul' but they seem to only be trying 'foul'.
Yes you still miss the simple fact that Motorola has not according to Apple offered a FRAND licence, the courts have been very clear on this (Motorola has lost every case). Apple dosn't think Motorola has offered a FRAND licence, the courts will decide. It's a binary arrgumeant, either Motorola has or they hasn't. If the courts think Motorola hasn't then Apple will get the courts to force Motorola to do so. If Motorola has then the courts will make Apple pay.
So far you all you have done is say "na na na, i dont understand FRAND", it's very easy to understands. But I guess when your paid not to see it's easy to be blind. Clearly your a sockpuppet.
Also you seem to forget that Apple bought the majority of nortels patents giving them over 10% of all mobile phone SEP's, they also testified to congress that they would licence them all under FRAND as that was their legal requirmeant, Motorola refuced to say if they would meet their legal requirmeants.
Still in 2 weeks time the trial will be over, Motorola will lose then appeal and lose again and it seems Google are about to get slamed by the DOJ for abuce of FRAND SEP, so you will have a chance to moan about how the 7th largest company in the world, a company worth more than $220 billion, is somehow being treated unfairly.
Well guess the register has become a lets hate Apple zone, no problem with that, i'll comment on this thread and then you babies can cry over your inability to use reason to judge tech or get a job. 25 years in this business and im so happy that i started my own bussiness. Good by reg, you traded page clicks for reporting and i hope you drown like those before who did the same.
"Fair, Reasonable, and Non-Discriminatory"
It means that you can't license under FRAND for a different price two different licensees.
And there are a maximum value you can charge in this one.
Which means, that if you negotiate the licenses outside of FRAND, you can get a different deal (and possibly a better one). Also means, that if Motorola setup a secondary company and stated that FRAND is $100 per unit, and if that is allowed by the consortium, then, that's the FRAND terms, unless you want to negotiate outside of them, which i recall Apple refused...
So they want the german court case and the USA court case figures to be combined, because the USA case keeps refering to worldwide sales, while the german one only refers to EU.
Ignoring the fact that the german court is an EU court, and the USA court isn't worldwide?
As for the $1 per phone. Google won't go for it, UNLESS apple agrees that it'll go back to all their previous phones, and not just future phones. A fair hit to apples funds that way (although they'll make it back instantly if the california court is
bribed convinced to uphold samsungs appeal
Apple admit they are infringing and owe something...
So back date it to all prior sales of course!
And lets hope Google are able to negotiate a decent rate!
but I do agree it has to be a fixed $ amount per device, NOT a percentage of revenue since that would be quite unfair.. But somewhere around $10 per device would do it...
"I do agree it has to be a fixed $ amount per device, NOT a percentage of revenue since that would be quite unfair."
AFAIK the terms applied elsewhere are based on the profit or sale value of what's being sold. Therefore, this would be Discriminatory to offer them as a fixed amount to Apple, hence against FRAND.
The difference is, I think, that it is normally licensed at component level.
On % of revenue vs $, is it really unfair? Either works depending on the situation and the amounts. A % amount allows the manufacturer to make cheaper devices where the patent costs scale, great if for example you wanted to make a budget handset for a developing country. A fixed dollar amount depreciates over time but doesn't penalise companies making more expensive products. Given Apple isn't likely to make supercheap phones I can understand why they want a dollar amount.
I have no idea how anybody can realistically figure out a FRAND rate. I guess you would have to base it off other patents already licenced that are of a similar nature and importance? Moto have to licence that tech as part of it being used in a standard. Perhaps a better solution is that when standards are written costs are worked out there and then for everyone who wants to use them and you but a licence for the entire standard?
"Perhaps a better solution is that when standards are written costs are worked out there and then for everyone who wants to use them and you but a licence for the entire standard?"
Yes, I completely agree that this would be the best way to deal with a standard. I believe this is done for many standards: You can buy, say, an MPEG-4 license and it covers all the patents involved.
However, this will not happen in all cases. It would force everyone to decide on relative values from the start, and would make it more difficult for large companies to negotiate better prices. Cross-licensing deals would be more difficult to implement, too. Basically, the big boys wouldn't want their power taken away from them, and the smaller players would be able to enter the game more easily, something none of the larger companies wants.
The FRAND deal was worked out by all the patent holders before the standard became a standard. Thats the SOP and it's worked well for decades, think CD, DVD, BlueRay, Bluetooth, FLASH memory, DRAM memory, HDTV, MPEG, GSM to name a few.
Apple is saying that Motorola has a duty to offer a FRAND contract, basicaly it has to offer Apple the same deal it offers everyone else. Motorola is saying it want's 2.25% of retail and if Apple dosn't like that it should negotiate but until they reach a deal all iPhones should be banned.
The problem is that if 2.25% of retail is FRAND then Motorola cant offer Apple better terms than it offered everyone else, assumadly 2.25% of retail. As it would get sued by everyone else. Motorola could win this case very easily by asking the court to force some of the companies that have agreed to 2.25% to testify. I assume any of the other patent holders in the SEP pool would do or anyone competing with Apple. HTC seems like a good choice as Apple buys nothing from them and so getting Apple to pay more wouldn't hurt them. But for some reason Motorola hasn't done that.
Missing the point of FRAND, this isn't about if Apple is using Motorolas SEPs, it is and their is no debate on that. It's about if Apple already has a licence by buying the chips from Qualcom which has already agreed a licence with Motorola (which Motorola then pulled but on for chips sold to Apple, this is where FRAND comes in) or if Apple must get a licence diretly from Motorola and if so, how much that will be.
You must be having difficulty to see through those glasses of yours that the reason for Moto acting aggressively now against Apple is that Apple themselves behave ridiculously aggressive with resp. to Android manufacturers (but not Microsoft!!).
So you think, it is fucking unfair to pay more than a buck per idevice for some real technology, whilst, it is absolutely fine to make Samsung pay to them $30 per their (cheaper) device for a piece of joke like, "rounded rectangles", "rubber band" or other similar pos patents?
The difference is of course apple doesn't have any frand patents meaning you don't need to do things the same way. Motorola has frand patents and in return for making your patent a requirement is it's got to be sold at a reasonable rate unlike other patents.
It's not that hard figure out.
The difference is of course apple doesn't have any frand patents meaning you don't need to do things the same way.
You don't, just make your galaxy phone trapezoidal, rhomboid, ellipsoidal or any 2-nd order or algebraic curve of your choice. Let conic sections and Algebraic Geometry help you!
Apple is known to patent the obvious. It's not only Apple that is doing wrong but the incompetent patent system allowing it + idiotic American justice that doesn't clean up that crap with plenty of prior art, unlike the saner British system . When a stupid jury can rule out this prior art consideration, since it cannot be put into the same processor Yet, Apple has the conscience to use it and ask $30 per device for this pos.
'"Apple is known to patent the obvious", thats not how patents work, you can't patent the obvious.'
Actually, looking at how the US patent system, in particular, works you can.
The patent office don't do any more than the bare minimum of checks to decide whether the patent is valid. They also don't have experts in every field working there. Their job is to make sure the paperwork is in order, do a quick search to see if the idea is already patented and then grant it.
Then, it is up to competitors to take the patent holder to court to try to have the patent quashed (or be taken to court and then try). The patent may be blindingly obvious to an expert in the field, or may be covered by prior art not noticed by the patent office.
I'll try and make it simple for you,Motorola agreed to licence some patens under FRAND and because they did they were given a monoply. Apple wants Motorola to do what it said it would do as Apple does with the SEP's it has agreed to licence under FRAND.
Is that to hard to understand?
As to Samsung, if they don't think Apples design patents and technology patens are worth anything, why did they write a 120+ page suicide note saying "copy Apple more"? Nokia never bothered, RIM never bothered, Palm never bothered and Microsoft never bothered to copy Apple!
Or do you just think that the only Android handset maker that is making money is the company that riped off the most succesfull hadset maker? That in case you are wondering is Samsung, the leaders of which have had to get 2 presidential pardons for coruption to avoide jail.
Not that the patents Apple is suing Android over aren't ridiculous, but whether they are or not they also clearly don't apply to Windows Phone which is why Apple aren't insane enough to sue Microsoft.
You can show a jury pictures of iPhones and Samsung phones and say "they look identical give us money", the same doesn't work because the metro style interface is fundamentally different. Apple would get laughed out of court for trying to sue Microsoft.
Surely if it is FRAND, then the patent holder sets a REASONABLE price for licensing the patent - say $x per item or per use of IP, and then publishes that price and charges everyone the same. Therefore FAIR and NON-DISCRIMINATORY in its application.
Am I being too simplistic?!?
Motorola doesn't have to re-offer Apple FRAND terms once they've refused them. They can deny Apple access to 3G patents Apple has claimed they don't need and won't buy, and is now saying they've willfully infringed, or they can charge the spoiled child any non-FRAND amount they choose.
This whole case is over what is or isn't a FRAND rate for Motorola's patents. There's no doubt that Apple are infringing or that Motorola HAVE to offer a licence at FRAND rates. The court is being asked to decide what this rate should be as Apple and Motorola can't agree the numbers.
Apple's position is that it should be NO MORE than $1 per device, which is kind of in line with what other users get charged when they buy a 3G baseband chip. If its that amount or less they will pay up in the spot. More than that and they reserve the right to appeal the judgement. That's what they are telling the court, not Motorola.
Motorola are asking for 2.25% of the average selling price. If the court decides that the patents are worth less than that then they are also free to appeal the judgement.
Apple demanding that they get everything for no more than $1 is neither fair nor reasonable and no Apple don't get away with it because it is FRAND. If they are unhappy with the terms offered then they have to show they followed due process and prove that the terms they are being offered are unfair and unreasonable. So far they have failed to prove that.
How have you dtermined $1 is neither fair or reasonable? Motorola will get millions of dollars for doing nothing and given there are frand patents that charge less than that, I fail to see how anyone can say that's unreasonably low.
My guess is it's a case fantardism that makes you think they should be charged an astronomical amount and that will how you get to beat apple. That's kind of sad really.
'Motorola will get millions of dollars for doing nothing'
Only for helping to invent things that actually make a phone work and without which Apple wouldn't even have a product. And in your world Apple asking $30 for something not worth the paper it was printed on is entirely reasonable. Fanbois give it up, you lost this argument a long time ago and now courts all over the world are confirming what we have been saying all along.
Yes but Apples case is that it has not been offered FRAND by Motorola, Apple is saying that it has been desciminated against by Motorola and the evidence is clear that it has. Apple bought components from a suppier that licenced Motorolas SEP's under FRAND. Motorola said your licence to our SEPs is withdrawn for Apple but nobody else. Motorolas problem is that for the first 3 years the iPhone was on the market they had no problem with Apple buying the components, it was only with the 3GS and their profits tanking that they tried to extort money.
Yes with 120 billion in the bank, it is extortion and there are 120 billion reasons.
You're confusing FRAND/non FRAND patents and normal vs design patents.
FRAND requires the owner to license at a fair and non-discriminatory rate. Apple have patents used in h.264 video that fall into this category, and my understanding is that they get pennies for there use.
Non-FRAND patents can be licensed (or not) for however much the owner can get away with. There is no set rate or requirement to license. The rounded corners thing was part of a design patent, which are never FRAND as they are never essential to industry standards (they are about cosmetic appearance).
"You're confusing FRAND/non FRAND patents and normal vs design patents."
I think what people are trying to say is; if essential technology patents become FRAND, then shouldn't VITAL design patents also be included?
If a company is so amazingly innovative to invent rounded corners, and this is used on pretty much all phones available today then surely it's an essential patent, whether being a technology patent or design patent.
Almost all other potential licensees are in the patent pool. Apple is not part of the patent pool, and doesn't want to be. Nor are they willing to generally cross-license.
Being part of the patent pool is like going to a potluck party. Everyone brings a dish. There is a mechanism for payments if someone brings, say, a single cupcake. But with reasonable players, the valuations often work out so that no net payments are made. Now Apple is coming in as a party crasher. They've eaten half a plate of food, covered with ketchup they brought. When someone asks why they aren't sharing the ketchup, they say the ketchup costs $30 per serving offer $1 for the food.
But if you're going to use it then it goes something like this :
The party organiser asks who's willing to provide food and if they will commit to charging a fair and reasonable amount for it to anyone who asks. They take a look at what's on offer and compose a menu from what's good and not too expensive.
The party starts. Party goers are asked to pay a cover charge of, say, $10, for the food, but people who have brought food as agreed can knock this cost off of their own entrance, or not go in and take the cash. Someone like Apple turns up and pays the $10 to get in, but then Motorola says that this doesn't cover their offering and they want $200 for that. You've already eaten it? Oh dear, cough up the cash.
Apple is part of many patent pools for SEPs, It bought the main part of Nortels mobile patents.
Are you saying that Apple should licence IOS becauce someone else want's it? Isn't that like saying "hey I like your GF, lend her to me for a night, here's some money"
How difficult is it to undertand FRAND, SEP and patents!
Motorola has consistently been on the losing side of these battles so it's not hard to see they are being unreasonable. A $1 tbh is more than enough considering how many units are sold.
I'm just glad the FCC and others are starting to look after google. They're becoming exactly what ISPs wanted to be and that's the service and content provider. Tbh, their fiber network and motorola should be split off from the content side with android going along to motorola.
It is not that odd now to see how Apple is similar to Microsoft in this and other affairs. Here is an algorithm that seems to apply to them now:
1) when you find yourselves floundering in a muddy stagnant proprietary puddle, being unable to innovate. When stealing doesn't help anymore , your competitors are better, sue them for rounded corners, circular squares, rounded wheels, rubber band, exFAT long names, double-clicks or any other rocket science patents you find suitable and suable.
2) when the competitors see this and ask to pay for their piece of cake technologies that, e.g., make cell phones cell phones, start a very audible whining noise "WTF, they make us, well known orphans, pay for our lunch, how dare they! Abuse of FRAND!!"
3) Do not attack your comrades-in-proprietary-arms, other respectable jackals of industry. Do help them with all means at your hands and in your pockets. Use pockets of others if necessary, may outstanding jury foremen and the Great American justice system help you. Microsoft, Apple, Oracle and all the like, unite! Commemorate the life and death of SCO!
Whenever you see a cop beating a guy, wherever a hungry newborn baby cries, whenever you feel FRAND ITU-T or ISO idiocy, look for me ma' -- you'll see me (c) song of young smart Alec. MS and Apple are both known to exploit deficiencies in the law and license agreements, and honestly terms of FRAND are bullshit IMNSHO, and companies who signed FRAND are idiots.
I've always wondered why Apple needs to charge more for average spec tech devices.
Oh, they look pretty and have a UI that my 6 year old learned to use marginally quicker than my Android toys but "Pub Poser Value" aside, I just couldn't see where the extra money was going.
Now that they are cutting back on R&D the answer is clear; Lawyers fees!
It's why Apple needs iCustomers to pay more.
Note: Before the rabid fanbois jump on this post; My home has Apple and Android phones/tabs, but since the arrival of the 'droids neither my wife or kids have bothered to recharge any of the Apple devices.
People seem to be confusing lots of things. The cost of a chip is generally very little except when maybe first produced on a new process. The costly part is the R&D in developing that IP then getting a return for it, so a device may only cost a few $ or less but the IP may be worth tens of dollars.
If as someone says Apple wants $24 for effectively rounded corners and a mainly screen tablet then I think it is probably fair that in order to make a phone call or transfer data is worth more after all by its nature it is essential unlike rounded corners.
Non-Discriminatory does not mean that one company pays the same as another. It is appropriate that a company that uses more licenses than another gets a better discount or that a company with a poor credit rating pays more, so for example Samsung sells many more phones than Apple so may expect a bigger discount than Apple. Apple on the other hand don't have a good track record on paying licenses to Motorola so they may see them as a risk until proven otherwise.
Non Discriminatory means that negotiations should be entered into in the same manner with access not conditional on different things. For example giving one player special deals based on signing early.
Looks like the court case might be cancelled... judge is not happy:
"...Apple states that it will not commit to be bound by any FRAND rate determined by the court and will not agree to accept any license from Motorola unless the court sets a rate of $1 or less for each Apple phone....
In other words, if Apple is unsatisfied with the rate chosen by the court, it “reserves the right to refuse and proceed to further infringement litigation.” ... Despite its position, Apple maintains that it is entitled to specific performance in the form of the court determining what a FRAND rate is for Motorola’s patents. At the final pretrial conference, I asked Apple to explain why it believed the court should determine a FRAND rate even though the rate may not resolve the parties’ licensing or infringement disputes. I questioned whether it was appropriate for a court to undertake the complex task of determining a FRAND rate if the end result would be simply a suggestion that could be used later as a bargaining chip between the parties. Apple responded that the rate would resolve the dispute in this particular case, namely, whether Motorola’s license offer was FRAND and if not, what the rate should have been.
Apple’s response was not satisfactory and did not assuage my concerns about determining a FRAND rate that may be used solely as a negotiating tool between the parties. After further consideration, I believe it would be inappropriate to grant Apple’s clarified request for specific performance."
Whilst it's repeatedly referring to the german court decision, that was a regional court and the recent UK one is both higher level AND binding EU-wide.
It's a bit like trumpeting a california court decision whilst ignoring a contrary federal circuit court decision which both trumps it, and covers the same state.
The results of ignoring the Fedreal court decision would be the same as is now happening in the EU. Apple are playing with fire when they cheek a judge. ("20 years in the Juvie Cubes!")
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