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Patents dominate tech news once more

by Scott Bicheno on 18 August 2011, 10:46

Tags: Google (NASDAQ:GOOG), Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT)

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Cold war

When Florian Muller started blogging about the intricacies of the tech patent system back in early 2010, he surely didn't anticipate becoming one of the most quoted third parties in general tech news little more than a year later.

It's an indictment of the nature of the tech business and the strategies of the major players that patent disputes play such a prominent role in our coverage these days. They've become a parallel competitive landscape, residing alongside the design and marketing of the products and services themselves, never more so than this week

The main reason is that we're still in the early stages of the mobile Internet era - as opposed to the start of the PC era in the early 80s and the Internet era in the mid 90s - and everyone's jostling for position in a market that is expected to be highly lucrative for decades to come. But a secondary reason is the rapid ascent of Android, and its ‘open' nature.

The larger Android has become, the harder competitors - especially Apple and Microsoft - have looked for ways to knock it down a peg or two. Don't forget, they're the OS incumbents, not Google. The development of Android, which allows a large number of third parties to contribute via the Open Handset Alliance, has left it especially exposed to patent claims. To his credit Muller has been highlighting this for some time.

While the wording of patent claims id full of haughty, moralizing language about how wrong it is to rip-off IP, this is a competitive strategy more than anything else. That was demonstrated more clearly than ever when lifelong bitter enemies Apple and Microsoft decided to gang up on Google in order to prevent it buying a bunch of patents belonging to Nortel.

It's generally considered that the Nortel manoeuvre made Monday's Motorola announcement inevitable. But it's also thought that Moto's potential 24,500 patents alone won't be enough to protect Google and the Android ecosystem from the multi-fronted patent attack it's currently subject to.

So any other chunks of patents that may in some way be used as leverage in these disputes are still very much in demand. Reuters has published a vaguely sourced story that says a bunch of tech companies are ‘pondering bids for InterDigital', which licenses mobile technologies and has wisely put itself up for sale. The fact that this is a story at all speaks volumes about the current market.

We're in a tech patent bull market, declares the NYT, while ZDNet goes one further in declaring it a speculative bubble. Kodak, the beleaguered former photography giant, has realised its patents are probably worth far more than the company itself, and has reportedly put them up for sale. Meanwhile HTC launched another patent broadside against Apple, who in turn suffered a couple of minor setbacks in its action against Samsung.

It looks like now is a good time to own mobile tech patents, with the market value inflated by the need for the major warring parties to stockpile weaponry. The hope is that we achieve a patent equivalent of mutually assured destruction, such as the world experienced after the second world war and, perversely, relative peace would be assured.

But, to explore that analogy further, we're probably still only in the late 50s/early 60s in the development if this cold war, and Googorola could be its Cuban Missile Crisis. Let's hope, for the sake of competition, no judge is tempted to push the metaphorical big, red button.

 



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The hope is that we achieve a patent equivalent of mutually assured destruction, such as the world experienced after the second world war and, perversely, relative peace would be assured.

But a peace in which there is effectively 0% chance of any truly new entrant to the market…