Can patent licensing fees derail the Android express?

[RogerV]

http://gigaom.com/2011/07/08/can-patent-licensing-fees-derail-the-android-express/

[Karsten Silz]

No.

On Jul 11, 6:19 pm, RogerV <rog...@qwest.net> wrote:
> http://gigaom.com/2011/07/08/can-patent-licensing-fees-derail-the-and...

[Reinier Zwitserloot]

I am so not a lawyer, but while Oracle is increasing the noise its making in this lawsuit (recently the preposterous claim that Google now owes Oracle 6 billion dollars. Preposterous in that Google somehow infringed for that amount, not necessarily preposterous in that a well paid team of legal geniuses may actually convince a judge of that) - the actua case has been turning google's way every time.

[Fabrizio Giudici]

Frankly speaking, I see the actual case turning Oracle's way every time.
I think Oracle has concrete chances to make a good deal of money out of
it and the mere fact that now Oracle and Google are talking about money
sounds to me as a precise indication. I don't think that the Android
express will derail, for the simple reason that Oracle doesn't want to
"punish" Google, but to make money. You don't kill the golden-egg
chicken, so they will probably get a reasonable amount of money that
makes Oracle happy and Google not too sad.

BTW, the fact that Microsoft is already making money out of Android for
a patent thing already demonstrates that Google didn't make all the
legal homework properly.

--
Fabrizio Giudici - Java Architect, Project Manager
Tidalwave s.a.s. - "We make Java work. Everywhere."
java.net/blog/fabriziogiudici - www.tidalwave.it/people
Fabrizio...@tidalwave.it

[Josh Berry]

On Wed, Jul 13, 2011 at 3:00 AM, Fabrizio Giudici
<fabrizio...@tidalwave.it> wrote:
> BTW, the fact that Microsoft is already making money out of Android for a
> patent thing already demonstrates that Google didn't make all the legal
> homework properly.

I would actually take this more as evidence that our patent situation
is askew than I would that someone did something wrong.

[Reinier Zwitserloot]

No, the microsoft thing is a natural side-effect of the screwed patent system. Microsoft isn't winning any cases; they are simply bullying the smaller manufacturers into paying the licensing fee because going to court would be far more expensive and risky. They know how to squeeze another 5 to 10 bucks on a per-phone basis. Simply increase the price. That's annoying and costs money but its unlikely to short-term bankrupt the company. Fighting Microsoft in court is a massive up-front expenditure and while it may lead to a much more rosy long-term future, it may also lead to the worst long-term future imaginable, at least for a company (bankruptcy, if microsoft wins big). It doesn't really matter that microsoft's chances are low.

Google could have solved that either by offering a patent indemnity deal to android phone makers, forcing microsoft to have to go after google instead, or even more simply by donating their own legal team and money to run defense for these kinds of things, but even that last one doesn't really work; most likely a smaller manufacturer would rather not take on the risk (as its their butt on the line in that case).

In the mean time, in Oracle v. Google land: *OF COURSE* Google and Oracle are talking money. At some point the two legal teams start moving closer together on their understanding of the chances of each team. When they get close enough, there's a number that both teams are willing to accept. At that point, case is settled and that's that. There will always be some money involved (unless Google countersues, of course, but it doesn't look like they can feasibly do that). The question is: How much?

Let's say, for arguments sake, that google believes the odds are about 1% that Oracle will be awarded the full monty: An ~8 billion dollar value settlement (let's say 4 billion cash + the legal right to keep bleeding the android train dry for the indefinite future, worth about 4 billion too), and a 99% chance its all thrown out. I'd say that'd be a fantastic result for Google's legal team. If Oracle's legal team agrees, then at some point somebody is going to suggest that Google pay Oracle 80 million dollars in exchange for total indemnity and most likely both teams would agree to that deal.

The legal teams can try to influence each other, in fact that's what most of the legal posturing seems to be about, as a settlement is so overwhelmingly likely. By throwing out such insane numbers, perhaps team Oracle is trying to convince team Google that the number they should put next to "worst case scenario" in their analyses should be really really really large, which would increase the settlement amount that Google can live with.