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Patent Wars

Written by Michael Coyle on 06 June 2012

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Google has filed a regulatory complaint with the European Commission, the US Department of Justice and the US Federal Trade Commission against both Nokia and Microsoft claiming that the two companies "are colluding to raise the costs of mobile devices for consumers, creating patent trolls that sidestep promises both companies have made. They should be held accountable, and we hope our complaint spurs others to look into these practices." The company in question is Mosaid based in Ottawa, which took control of 2,000 Nokia patents, in addition Microsoft has also given it control of a significant number of patents. A Patent troll or "non-practising entities", are companies which own patents but which do not make anything of their own.

Microsoft dismissed Google's claim as the "desperate tactic" of a company facing its own questions concerning dominance. Nokia stated "Both companies have their own IPR [intellectual property rights portfolios and strategies and operate independently, Nokia has made regular patent divestments over the last five years. In each case, any commitments made for standards essential patents transfer to the acquirer and existing licenses for the patents continue. Had Google asked us, we would have been happy to confirm this, which could then have avoided them wasting the [European] commission's time and resources on such a frivolous complaint. We agree with Google that Android devices have significant IP infringement issues, and would welcome constructive efforts to stop unauthorised use of Nokia intellectual property. Nokia has an active licensing program with more than 40 licensees. Companies who are not yet licensed under our standard essential patents should simply approach us and sign up for a licence."

Google's attack marks an escalation in the battle for mobile phone supremacy. Mosaid believes it is sitting on a potential goldmine and the Guardian reported "royalties from the intellectual property rights could bring it more $1bn in revenue over the next decade. Under terms of the sale, Mosaid keeps one-third of the revenue from the patent royalties with the remainder going to Nokia and Microsoft. That means Mosaid's revenue estimates imply the patents could generate licensing fees of $3bn during the next decade." Wow!

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