Apple, briefly the most valuable company by market capitalization a few weeks ago, has seen a remarkable recovery from being almost bankrupt less than 15 years ago. Its iPods and iTunes truly revolutionized the music industry and now the iPhones and the iPads are doing the same to the mobile phones and computing industries.
The changes in these industries have been so dramatic that erstwhile giants Nokia and Microsoft have been found struggling to keep pace. Other companies such as HTC, Samsung and Motorola, all powered by the Google-driven Android OS, are the new competitors for Apple. The rapid rise of the Apple first attracted Nokia to file a patent infringement case on Apple for violations by iPhone of 10 patents related to wireless data, speech coding, security and encryption. Given that Nokia has been one of the pioneers in mobile telephony and Apple only began creating mobile phones in 2007, Apple’s need to use GSM and IEEE 802.11 standards seems inevitable and hence the need for Apple to pay royalty for Nokia’s IPR essential under these standards. The only question would be if Nokia was willing to provide Apple with Fair, Reasonable and Non-Discriminatory (FRAND) terms and conditions for licensing these patents. Since over 40 mobile-phone manufacturers have licensed these patents, according to Nokia, it’s intriguing why Apple would not be offered similar FRAND terms and conditions. So, prima facie, Apple appears to be culpable of violating Nokia’s IPR.
Curiously, while presenting its response to the above lawsuit, Apple actually counter-sued Nokia of infringing on 13 of its patents related to real-time signal processing, list scrolling and document translation, scaling and rotation of touch-screen display, among others. While some of the patents date back to the 1990s and claim that the usage of the USB port itself is a violation, others have strangely patented ideas like “Conserving Power by Reducing Voltage supplied to an Instruction-processing Portion of the Prorcessor” instead of particular methods to achieve this! I wonder what the non-instruction-processing portions of the Processor are and whether this patent denies any energy-saving method that employs voltage reduction to such instruction-processing portions. If that is so, it sounds like a patent wrongly granted because the concept of energy-saving by Voltage reduction should have been around for decades and is certainly not invented by Apple.
Subsequently, the Delaware court, where the two lawsuits were filed, has put both the lawsuits on hold pending decisions by the US International Trade Commission (ITC) on the matter. Apple also tried to take a further aggressive stance against Nokia by bringing the patent battle to UK courts by alleging violation of 9 patents (wonder where the residual four violations disappeared!) and it seems more of an arm-twisting tactic in the negotiations with Nokia, rather than any genuine violation of Apple’s IPR.
In the meantime, Apple sued HTC for infringement of iPhone patents which is bound to ultimately drag in software licensors Google and Microsoft, particularly if HTC has an indemnity clause related to litigation on the licensed technology. A quick glance at the court filings in this case reveal some of the patents alleged to have been infringed by Nokia, in addition to frivolous things such as “Unlocking a device by performing gestures on an unlock image” and “Automated response to and sensing of user activity in Portable Devices”. I wonder whether while granting such patents, the US Patent Office even stopped to consider that any touch-screen device would require the user to perform a gesture on an unlock image or make automated responses on sensing user activity and these cannot be considered an “innovation” whatsoever!
HTC counter-sued Apple alleging violation of general hardware and software used to implement directories in mobile phones and power management in mobile devices. Given that at least one of these patents was only granted a day before the filing of this complaint, it’s clear that the Patent Offices are granting patents without adequate checks to ensure that the technology is not already in use (which would render it non-patentable). This looks like a rather weak attempt by HTC to gain some bargaining power against Apple.
Microsoft, in order to defend its Windows Phone 7 OS and attack the freely available Android OS, filed a patent infringement lawsuit against device-manufacturer Motorola claiming 9 patent violations related to syncing e-mails, contacts and calendar entries and notifying applications about changes in signal strength and battery power. Here too, if there’s an indemnity clause on licensed technology between Google and Motorola, the former will have to be included as a defendant like the Apple vs HTC case. Also, the Patent Office again appears culpable of awarding patents that are too general (the implementation of the idea and not the idea itself should be patented; syncing e-mails, for example, is a concept/idea and should be allowed to be implemented in a non-patented manner).
Within a week, Motorola sued Apple for violating 18 patents related to wireless communication technologies, wireless e-mail, proximity sensing, location-based services and multi-device synchronization. Some of these might be similar to the patent violations claimed by Nokia under the WCDMA and 802.11 industry standards, which will invite F/RAND terms and conditions for licensing. Others seem to have been idea-driven rather than ways of implementing an idea, which is another instance of the short-coming in the patent-granting process itself! Apple sued Motorola on violations of its multi-touch patents and more recently on violations related to its Motorola Xoom tablet, which Motorola has dismissed to be without merit.
More recently, Apple sued Samsung on the design of the Samsung Galaxy Tab and smartphones which is more of a design infringement rather than patent violation. This lawsuit invokes the principles of Community Design and Apple even won injunctions in the European Union and Australian courts on the matter, forcing Samsung to go for Apple-approved Tablets in Australia. However, even this particular duel had its counter-suit by Samsung on Apple wherein Samsung claimed Apple violations of HSPA and WCDMA telecom technology patents and technology for tethering a mobile phone to a PC. Though these violations, if proven, appear more serious than the claims of design infringements, Samsung is clearly on the backfoot after losing the EU and Australian cases. However, given the symbiotic relation between Apple and Samsung, as uncovered by the Economist, and the extent to which an iPhone’s components come from Samsung, it seems strange that Apple has actually gone ahead with suing Samsung on this matter, given its dependence on Samsung is higher than Samsung’s dependence on Apple.
The progress of patent wars seems to have engulfed the entire PC/mobile industry as technology giants try to build their patent arsenal, predominantly as a deterrent against patent attacks by other firms. As one of the recent articles on NPR shows, patent trolls are stifling innovation across the software industry and seems to be a big drain on shareholder money spent towards litigation and building the patent arsenals. It’s high time the patent offices around the world take notice and stop issuing frivolous patents and also seriously limit the duration for software patents to 3-5 years instead of 25 years because of the much faster speed of changes and technological progress in this particular industry.
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