Microsoft just announced two royalty-bearing Android patent license deals with device makers operating in the German market: one with Swedish company EINS SE, which "manufactures Android tablets under the Cat brand in Germany" (here's an example on the German Amazon site), and another one with Hanover-based Hoeft & Wessel AG ("Höft & Wessel" in German; click here for the corporate website). Hanover ("Hannover" in German) is known in the computer industry for hosting the CeBIT trade show. According to the press release, Hoeft & Wessel "manufactures handheld devices and terminals for the public transportation, logistics and retail industries in Europe".
In accordance with industry customs, the announcements don't specify financial terms, but they do state explicitly that Microsoft will receive royalties for Android's use of its intellectual property.
Android device makers around the globe increasingly recognize that Google's mobile operating system makes extensive use of third-party intellectual property. Microsoft's license arrangements with Hoeft & Wessel and EINS SE are already the 16th and 17th Android-related patent license deal. I recently listed 15 other license deals, most of which were signed by Microsoft but the most recent one of which was Apple's settlement with HTC (which I described as a "lopsided" deal, with HTC being on the paying end, based on a review of a largely-unredacted copy of the agreement).
When I listed the 15 previous announcements I predicted that "there certainly will be lots of Android patent license deals in 2013". I actually believe that in 2013 alone there will be more royalty-bearing Android patent license deals than during the last three years (2010-2012). Not only will Microsoft continue to sign up licensees but Apple will also expect companies to respect its IP, and Nokia only started its related patent enforcement in May and will likely have a deal in place with HTC, ViewSonic and many others within about a year. And those three companies aren't the only ones looking for solutions to Android's infringement: even Ericsson's recent lawsuits against Samsung target "software and user interface technology" used by other Android OEMs as well.
The Android patent license agreements Microsoft announced before were signed with U.S. and Asian companies. Today's announcements show that Europe, which is a huge market for Android, is also included in Microsoft's technology-sharing program. Germany is the largest European market, and it's also a key patent litigation venue. Microsoft didn't actually choose to litigate in this country but was forced to countersue after Motorola was trying to take advantage of this jurisdiction's patentee-friendly (and not particularly FRAND-friendly) legal framework. Microsoft's countersuits in Germany have already resulted in injunctions against the now-Google-subsidiary over three patents: the first one over a multi-part text message layer patent in May, the second one over a file system patent in July, and the third one over an operating system-level soft input patent in September. Microsoft is slowly but surely continuing its German patent enforcement against Google.
Google's Motorola is the only major Android device maker not to have taken a license to Microsoft's numerous patents that read on its products. Samsung, HTC, LG and others have been paying Microsoft for some time, and chances are that Motorola would also have agreed to address Android's IP issues through a license agreement if it had not been acquired by Google, which now micromanages Motorola's litigations and negotiates settlements on its behalf. At a recent hearing held by an appeals court, Google's (Motorola's) lawyers said that their client lost four months of sales in Germany because of the need to work around Microsoft patents. If Motorola had simply licensed those patents, it would not have lost one day of market presence. And the four months that it lost won't have been the last period of absence from the marketplace if this dispute continues and Microsoft wins and enforces additional injunctions.
For Android device makers who unlike Google can't afford to stay out of the German market for an extended period of time, Microsoft's court victories over Google's own Motorola Mobility prove that litigation is not an advisable choice, while licensing is a viable way forward for large and small companies alike. I am absolutely convinced that it's only a matter of time that Google's Motorola Mobility will also enter into an Android patent license agreement with Microsoft. How much time? That will depend on Google's leadership.
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