Wednesday, August 17, 2011

The Patent Wars are not new, the Battle for Mobile is

The battles we are now witnessing among tech giants for patents are not new. What is new is the realization that mobile is the new battle ground and the stakes are high.  In patent wars, it is a chess game and one of the objectives can be to stop the other vendor from succeeding. Often this can be mitigated by a cross-licensing arrangement that users rarely hear about.

In mobile, Microsoft  has been racing to catch-up and it is working hard to make sure it has plenty of armor (patents). Apple has been surging and it has been filing patents in droves for years. They learned the hard way (from all the Microsoft battles in the early years) that patents help sustain and protect the business. Apple has also been working very hard on doing the right patent acquisitions (note that Apple won the bid for the Nortel patents because it partnered with EMC, Ericsson, Microsoft, RIM, and Sony).

Much of the talk has been around Google, its failed bid for the Nortel patents and this week, its hefty purchase of Motorola Mobility. Given that it failed on the Nortel bid, it didn't have much choice to buy Motorola and gain access to its 17,000 issued patents. What was ominous for Google was that Microsoft was one of the other bidders. That said, while Google is getting abused in the press about the Motorola price tag, it is getting 17,000 patents (Microsoft has over 18,000).

IBM has one of the biggest patent portfolios in High Tech, it is very good at creating patents and it has made a business out of licensing them. IBM plays the game very well and it is professional about it. It can get a little nasty with some of the others. Google could certainly learn from IBM and it looks like it has, since they just cut a deal with IBM to license 1,000 of its patents.

An example of patent licensing that many don't know about occurred in the copier market. Years ago, Canon had invented a new way of applying toner to paper and later a modular system for packaging toner cartridges. It brought Xerox to the table and a cross licensing deal was cut way back in 1978. However, while Xerox got access to the Canon patent portfolio, Canon gained access to Xerox's high speed paper handling patents and 20 years later, Canon eventually crept up into the departmental copier space where Xerox made a large majority of its profits.  There are always trade-offs to patent licensing deals.

In mobile, the battle it isn't just about patents on the core technologies, it is about the entire mobile ecosystem. More about that in some of our upcoming research. If you haven't checked out the newest research firm, Aragon Research, please stop by our site.

1 comment:

  1. Thanks for the overview of this tech-patent 'Clash of the Titans', Jim. Good luck with the new enterprise. Keep those insights coming! Gavin Cunningham, Cunningham IP Law, LLC (