Tony Bradley July 20, 2011
Apple won a preliminary victory over HTC—and over Android by proxy—when the ITC agreed on Friday that HTC smartphones violate two Apple patents. The ITC decision could be a sign that the Android party is over, and the mobile OS could be in trouble.
Why is the ITC ruling such a death blow? First, the patents in question are not unique to HTC—they are integral to the Android OS itself. If HTC is found to be violating these two Apple patents, then so is Motorola, and Samsung, and anyone else making Android devices.
Florian Mueller, an expert on intellectual property, explains in a blog post: “Those patents are apparently infringed by code that is at the core of Android.”
Mueller has created a table that walks through the two patents and compares the patented concepts against the HTC/Android implementation. Reviewing the information on the tables, Mueller exclaims, “It’s hard to see how any Android device could not infringe them, or how companies could work around them.”
One of the primary benefits of Android—and a driving force behind its broad adoption by smartphone vendors, and rapid success in the market—is that the OS is open source and license-free. More and more, though, it seems like the lack of licensing paid to Google for using Android will more than be compensated for by fees and royalties being paid to Apple, Microsoft, and others that the Android OS infringes on.
As it stands, Microsoft is making more money from Android licensing agreements with companies like HTC than it is from its own Windows Phone 7 mobile OS. It is also pursuing legal action with Samsung and has proposed a deal of US$15 per Android device.
Those costs start adding up quickly. Vendors like HTC and Samsung then have to choose whether to pass the costs along to consumers by charging more for the Android devices, or eat the expense and cut severely into their own profit margin.
Making iOS devices is not an option because that’s not the way Apple rolls, but paying one licensing fee to Microsoft and cranking out Windows Phone 7 smartphones may be more appealing to manufacturers. It is even more tempting when you consider that Microsoft guarantees that Windows Phone 7 is free from patent infringement issues and it will defend any claims to the contrary—unlike Google which is sitting silently on the sidelines and letting vendors fend for themselves.
Mueller claims, “Android is also under fire in dozens of federal lawsuits. By my count, there are 49 Android-related infringement suits (federal and ITC).” If even a handful of those go against Android, or Android device manufacturers, it will severely handicap the future success of the OS.
A final determination in the ITC battle between Apple and HTC is expected in early December. A worst-case scenario for HTC could be an ITC ban against HTC importing any Android devices into the US.
A similar fate could await Motorola, Samsung and the rest of the Android bunch. The way things look now, Android could be in for a rough—and expensive—ride.