Thursday, September 8, 2011

Google helps HTC in patent battle



The attempt to prop up HTC’s share price, how ever, appeared to have little effect as the stock fell below HTC’s
minimum purchase price of T$900 to close dow n 3.9 per cent at T$871
Google has stepped into the widening legal battle pitching Asian smartphone makers
against Apple by transferring patents to Taiwan’s HTC, which is fighting charges from the
iPhone maker of intellectual property infringement in its Android phones.
The US internet search group, which allows makers to use its Android mobile phone
operating system for free, transferred nine patents to HTC last week.
On Wednesday, the smartphone maker used some of its newly acquired intellectual
property to file countersuits against Apple in two US courts.
HTC has lost an initial court ruling over patent infringement to Apple.
Intellectual property has become a battleground in the smartphone industry, with both
Apple and Microsoft challenging Android phone makers such as HTC and Samsung in
courts in the US, Europe and Japan.
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Google’s move shows how the group is growing more active in throwing its weight behind
other groups using Android, after a pledge to protect its operating system against legal
threats when it agreed to buy Motorola Mobility for $12.5bn last month. The deal will
give it control over Motorola’s more than 17,000 patents.
Larry Page, Google chief executive, said at the time that a stronger patent portfolio would
enable the company “to better protect Android from anticompetitive threats from
Microsoft, Apple and other companies”.
Of the patents transferred to HTC, none were part of the Motorola acquisition, which is set
to close early next year.
HTC confirmed that it had expanded legal actions against Apple but did not comment on
the acquisition of patents from Google.
Pierre Ferragu, an analyst at Bernstein, said some of the patents that Google had
transferred were similar to Apple patents that the US International Trade Commission
ruled had been infringed by HTC. This suggests Google is helping provide legal
ammunition for HTC’s fight against Apple.
“With ‘Googorola’ stepping in to support the Android ecosystem, the chances that Apple
forces major workarounds or gets meaningful royalty payments become very unlikely,”
Mr Ferragu said.
The transfer opens the possibility of Google helping other Android phone makers.
Samsung is expecting a ruling today from a German court on whether the design of its
tablets was stolen from Apple’s iPad. Samsung faces a ban in Germany for its tablets if it
loses.
CK Cheng, analyst at CLSA, said Google would probably offer similar patent protection to
other Android phonemakers, especially after the Motorola deal closes.
“But there is very little information out there now and it is unclear whether or not Google
would charge phonemakers for such protection,” he said.

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