Why Mobile Patents are Such a Mess

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Microsoft announced this week that it has inked a deal with Taiwan-based High-Tech Computing (HTC). Under the agreement, HTC will pay royalties to Microsoft for phones that run Google’s Android platform.

Wait, what?

Microsoft claims that the Linux operating system infringes 235 Microsoft patents, and Android, which is Linux-based, violates Microsoft patents, too. Microsoft has convinced HTC to pay royalties for the alleged Microsoft technology in Google’s operating system.

Why would HTC do that?

Well, Apple is suing HTC for violating 20 Apple patents covering a wide range of technologies. One theory is that with both Microsoft and Apple claiming patent infringement, HTC has to pick sides. It chose Microsoft because the company also makes a wide variety of devices that run Microsoft operating systems. Because it has an extensive relationship with Microsoft, and none with Apple, choosing to work with Microsoft solves its Apple problem. In court, apparently HTC will be able to say that it’s already licensing the technology Apple claims as its own, but from Microsoft. That would imply that Apple’s beef is really with Microsoft, not with HTC. Case closed!

Neither Microsoft nor Apple has publically detailed which patents or which technologies Google or HTC are infringing on, but it’s safe to assume they cover user interface, underlying architecture and a hodge-podge of random ideas for how phones work.

Cases like the Microsoft, Google, HTC and Apple mess are inevitable, given the state of patents on mobile devices.

Everybody’s Suing Everybody!

A Taiwanese chipmaker called Elan Microelectronics (EMG) sued Apple a year ago for infringing on a patent for multi-touch devices. The original suit focused on the MacBook, iPhone and iPod Touch, but has since been extended to the iPad.

Eastman Kodak filed legal complaints in January against Apple and Research in Motion over alleged patent infringement. The company claims that iPhones and BlackBerrys use Kodak methods for previewing photos.

In apparent retaliation, Apple countersued Kodak for infringing on its patented idea of using a unified memory architecture for a digital camera.

An inventor named Judah Klausner claims he invented and patented the whole idea of “visual voicemail,” which is where you can see a list of who left you a message. He’s already won cases against Apple and LG Electronics, and is now suing HTC.

A Canadian company called Wi-LAN is suing Apple, Apple, Acer, Belkin, Broadcom, Dell, D-Link, Gateway, HP, Intel, Lenovo, LG, Marvell Semiconductor, Motorola, Personal Communications Devices, Sony, Texas Instruments, Toshiba and UTStarcom for allegedly infringing on its Bluetooth patents.

A patent war between Nokia and Apple, with Nokia first suing Apple and Apple counter-suing, is expected to drag on in the courts for years.

These patent cases are just a small sample of the hundreds of legal complaints and active lawsuits currently being disputed by mobile companies.

What in the hell is going on?

The Truth about Mobile Patents

The truth is that you can’t build a cell phone at all without violating dozens or even hundreds of claimed inventions and patents. Every handset, tablet and mobile gadget maker knows this.

The way the patent system is supposed to work is that some inventor creates a new technology. When a company wants to use that technology, they seek out the inventor and negotiate to a contract that pays the inventor for his work.

In the mobile phone and computing space, it doesn’t work that way at all. Many companies just use whatever technology they want and wait until somebody sues.

But the lawsuits don’t actually reflect one-to-one the use of technology. Instead, peripheral motives predominate.

For example, Nokia used to dominate the handset market. As other companies like Apple rise to take its place at the top, Nokia sued apparently as a way to buttress its own fortunes and bring attention to its pioneering work in various cell phone technologies and methods.

Most of Apple’s patent-related lawsuits appear to be counter-suits. Apple may be using the courts as a disincentive for other companies to sue over patents. That would explain why Apple quickly and uncharacteristically settled a suit over visual voice-mail. The inventor was an individual who doesn’t make cell phones. There was nothing on which to base a counter-suit.

Microsoft sues Google’s partners, rather than Google, for Android-related infringement claims. Why?

One theory: If Microsoft sued Google, that suit would cover partners, who could freely embrace Android for years as Microsoft and Google fought it out in the courts. But by suing partners, Microsoft imposes an “IP tax” on the use of Android, providing a disincentive, a royalty payment scheme for Microsoft, or both. It’s a win-win for Microsoft, because — as in the case of HTC — Google’s hardware partners are also Microsoft’s, so Microsoft has additional leverage to force a royalty payment scheme.

None of the major companies really seem to take patents seriously. The whole patent system has become just another tool to use in the ongoing quest for revenue, customers and to win the game of partner politics.

And why should they take patents serious?

The United States Patent and Trademark Office grants patents for vague ideas, obvious processes and usage models and even the most mundane software user interface conventions.

Our patent system is so under-funded, its mission, criteria and processes so broken and ill-suited to today’s economy that the best solution is to just dismantled the patent office and start over.

We don’t need more lawsuits. We need inventions. But the first thing we need to invent is a better way to grant patents.