Microsoft files EU lawsuit against Motorola and Google

Microsoft is taking its battles with Google to court, at least in Europe. Today, Microsoft announced on its official legal blog site that it has filed a lawsuit to the European Commission against Motorola Mobility and Google. Motorola is in the process of being acquired by Google for $12.5 billion.

The blog post, written by Microsoft vice president Dave Heiner, claims that the company is filing this complaint due to Motorola not offering patents that it holds for watching video on the web on reasonable terms to anyone else who wants to use them. Microsoft claims that Motorola and the other companies that hold patents for these video standards pledged to make them available with fair agreements.

However, Heiner writes:

Motorola has broken its promise. Motorola is on a path to use standard essential patents to kill video on the Web, and Google as its new owner doesn’t seem to be willing to change course.

Earlier in February, Microsoft made a new pledge not to file a lawsuit or seek an injunction on companies that use "essential patents" from Microsoft in their products. However, Microsoft said today that Motorola isn't coming close to offering their patents in a fair manner. Microsoft uses an example of a $1,000 laptop. Heiner claims that Motorola is demanding a patent royalty fee of $22.50 for such a laptop for the 50 patents that it holds for the video standard.

Microsoft claims that 29 other companies hold a total of over 2,300 other patents that are needed to run the video standard, including Microsoft. The company says it would only charge two cents in royalties for that $1,000 laptop. Heiner writes:

And that is for a mid-level, $1,000 laptop. For a $2,000 laptop, Motorola is demanding double the royalty - $45. Windows is the same on both laptops, and so is the video support in Windows. But the high-end laptop will have a bigger hard drive, more memory, perhaps a titanium case—and Motorola is demanding a hefty royalty on all of this, even though none of these features implements Motorola’s video patents.

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Motorola is demanding a hefty royalty on all of this, even though none of these features implements Motorola's video patents.

Now comes the "oh $#!+ we shouldn't have approved the merger" from the US and EU. Pretty ridiculous. Here is the entire quote, since Neowin sucks at proper journalism these days:

Unfortunately, Motorola has refused to make its patents available at anything remotely close to a reasonable price. For a $1,000 laptop, Motorola is demanding that Microsoft pay a royalty of $22.50 for its 50 patents on the video standard, called H.264. As it turns out, there are at least 2,300 other patents needed to implement this standard. They are available from a group of 29 companies that came together to offer their H.264 patents to the industry on FRAND terms. Microsoft's patent royalty to this group on that $1,000 laptop?

Two cents.

That's right. Just 2 cents for use of more than 2,300 patents. (Windows qualifies for a nice volume discount, but no firm has to pay more than 20 cents per unit.) Motorola is demanding that Microsoft pay more than 1,000 times that for use of just 50 patents.

And that is for a mid-level, $1,000 laptop. For a $2,000 laptop, Motorola is demanding double the royalty - $45. Windows is the same on both laptops, and so is the video support in Windows. But the high-end laptop will have a bigger hard drive, more memory, perhaps a titanium case

Pot kettle black, Microsoft is attempting to make android an unrealistic option for device makers, yes their willing to license their parents but not for realistic prices.

thealexweb said,
Pot kettle black, Microsoft is attempting to make android an unrealistic option for device makers, yes their willing to license their parents but not for realistic prices.

H.264 is a standard and all companies with patents connected to this standard including Motorola agreed to FRAND licensing.

However the pantents licensed by android OEMs aren't standards, and not FRAND, and therefore can be licensed for whatever Microsoft likes.

And not to mention Microsoft charges a set fee regardless of the device's cost (Roughly about $7.50 per device regardless of its size, cost etc). Motorola wants to charge a fee based on the devices price even though they have nothing to do with that.

TheCyberKnight said,
Wondering if Google is not using Motorola as a front to kill the "traditional" PC industry with unreasonable royalties like this?

Or maybe to make a closed door deal with Microsoft regarding Android patent deals ? Who knows ? It's such a mess.

TheCyberKnight said,
Wondering if Google is not using Motorola as a front to kill the "traditional" PC industry with unreasonable royalties like this?

Maybe Microsoft and Google can come to some arrangement so Android makers don't have to pay royalties to Microsoft, and Microsoft doesn't have to pay royalties to Motorola/Google. That would be the best outcome for both companies I think.

Who knows whether Microsoft is willing to give up that revenue stream without fight though.

The patent system hurts the computer world so much. I would like to know how much money is wasted every year on lawyers because of that old and outdated system.

LaP said,
The patent system hurts the computer world so much. I would like to know how much money is wasted every year on lawyers because of that old and outdated system.

A lot lol

The whole patent situation is a goddamn mess. It's basically just a government-sanctioned anti-competition weapon. Patents for stuff required by international standards shouldn't even be allowed.

Majesticmerc said,
The whole patent situation is a goddamn mess. It's basically just a government-sanctioned anti-competition weapon. Patents for stuff required by international standards shouldn't even be allowed.

I totally agree. The problem is, what defines a standard. If everyone is using a method and it's very obvious, it shouldn't be patentable, as you suggested. The US PO looks at it backwards, it first grants a patent, then expects others to fight it out in court to prove prior art, something they should have done the due dillgence for in the first place. Quite a mess indeed.

Majesticmerc said,
The whole patent situation is a goddamn mess. It's basically just a government-sanctioned anti-competition weapon. Patents for stuff required by international standards shouldn't even be allowed.

All patents part of a standard, must be FRAND.

alexalex said,
At least Motorola is consistent with its claims for ~2.5% of devices price for its patents.

But it shouldn't be 2.5% per device, it should be 2.5% per product, in this case 2.5% of a Windows licence. I despise software patents regardless of who owns them, but Motorola are being completely unreasonable here.

Majesticmerc said,

But it shouldn't be 2.5% per device, it should be 2.5% per product, in this case 2.5% of a Windows licence. I despise software patents regardless of who owns them, but Motorola are being completely unreasonable here.

Tell that to Microsoft which gets $5-15 from EVERY Android device sold.

Majesticmerc said,

But it shouldn't be 2.5% per device, it should be 2.5% per product, in this case 2.5% of a Windows licence. I despise software patents regardless of who owns them, but Motorola are being completely unreasonable here.

I thought Microsoft was charging Android phone makers on a per device basis?

alexalex said,

Tell that to Microsoft which gets $5-15 from EVERY Android device sold.

Those patents are not FRAND patents, unlike the H.264 patents in question.

jonbjerke said,

Those patents are not FRAND patents, unlike the H.264 patents in question.

The problem is who gets to decide which patents are FRAND and which aren't. Things like slide to unlock are so common place and standardised that they should be subject to the same conditions that H.264 enjoys. The distinction is completely arbitrary.

simplezz said,

The problem is who gets to decide which patents are FRAND and which aren't. Things like slide to unlock are so common place and standardised that they should be subject to the same conditions that H.264 enjoys. The distinction is completely arbitrary.

Any patent used in an industry standard, must be licensed as FRAND.

Ishanx said,
Before: Microsoft vs Apple
Then: Apple vs Google
Now: Apple and Microsoft vs Google.
After: ?

Based on recent news, the World vs Google.

Ishanx said,
Before: Microsoft vs Apple
Then: Apple vs Google
Now: Apple and Microsoft vs Google.
After: ?

In fairness, I don't think Microsoft and Apple have sued each other for over a decade now, not since the whole Apple copied Xerox, Microsoft copied Apple debacle.

It's more like (Microsoft + Nokia) + Apple vs Google + Motorola these days.

Now that the Motorola Mobility acquisition by Google has been approved, I'm hoping it will put an end to all these frivolous lawsuits. All the big three now have key mobile and OS patents with which they can cross-licence.

simplezz said,

In fairness, I don't think Microsoft and Apple have sued each other for over a decade now, not since the whole Apple copied Xerox, Microsoft copied Apple debacle.

It's more like (Microsoft + Nokia) + Apple vs Google + Motorola these days.

Now that the Motorola Mobility acquisition by Google has been approved, I'm hoping it will put an end to all these frivolous lawsuits. All the big three now have key mobile and OS patents with which they can cross-licence.


thats because when MS bailed out Apple from certain doom, they made a pact to share their patents royalty free to eachother.