Originally Posted by cloudgazer
A billion here, a billion there, sooner or later you add up to some real money. The idea that Apple doesn't care about overpaying by a few hundred million is ridiculous, they do. The patents were by your analysis worth 4 billion to Ranger, do you think Google can't afford to lose a few more hundred million on top? Of course they can, they just don't want to. Can't you see how bizarre your worldview is here? You are essentially saying that it completely wouldn't matter if Apple overpayed by 500mil but it would be terrible if Google overpaid by 500mil? Really?
The error you keep making is in assuming that Apple would be overpaying. You don't know what this is worth to Apple or anyone else. It could be that it was worth much more to Google as well, but that they decided they couldn't afford it. It could be that Apple, who only paid $2 billion could have gone to $4 billion, or more. You don't know, so you should just stop talking about overpaying, because that's just your assumption.
You talk about worldview, but yours is from Mars. You have no logic to what you're stating. You're making up things from what you want to believe, and taking it from there. You are ignoring all the realities.
You keep insisting that only Google knows how much these patents are worth. It's just as likely that they have no idea as to how much they are worth. I'm not saying how much they were worth to Ranger, only that that was all they could spend. Other than that, we know nothing, but you seem to be insisting that you do.
You keep insisting that anything over Google's bid is over paying. why is that? Why do you assume that Google is so smart that only they know what they're doing? I happen to think that Google has been very stupid in all of this. I also believe that they are very worried about Android, and that they're trying to hedge their bets by backing this silly Chromebook initiative.
Google is a very strange company, and you can't trust what they say. Now, they're talking about how sad this whole thing is after losing. They are also making statements, at least Schmitt is, about how bad this is for open software and how these other companies aren't innovating, just relying on their IP, unlike Google, which by the way, he states will be looking for more IP. How convoluted and hypocritical is that?
He's basically stating that Google is using others innovations and IP in their products, and that therefor Google is innovative, even though it's the others who have done the inventing that Google is using, and oh, by the way, we're still looking for IP to buy, you know, just like those others they're whining about. I mean, really, give me a break!
Suppose Apple believe that there is no possibility that Google will overbid, as you apparently do. Apple also believe that the patents must be more valuable to Apple than they are to Google, as you also do. Therefore Apple must always outbid Google, which you have said is an unreasonable assumption. Something here clearly isn't right, and it's the assumption that you should never overbid.
You keep putting words in my mouth. I never said that Google wouldn't over bid. I also never said that they would. At least, not intentionally. This is what YOU are saying. You've been stating that from the beginning. You keep saying that Google could have bid higher than they wanted to pay in order to get Apple to pay more. I'm not stating anything of the kind.
I'm just attempting to respond to you obviously fallacious arguments where you state that.
You have an amazing ability to take what others say, and twist it around so that it bears no relation to it, and to then build up an argument that therefor has nothing to do with what that other said, but that somehow seems to support your own odd argument, which it wouldn't if you didn't misinterpret the original statement the other said, in these cases, me.
Game theory is full of cases where you must be willing to occasionally run an outsized risk in order to maximize your overall chances. The classic example is 'fighters & bombers'
. Even though attacking from the sun is the safest approach for the fighter, if fighters ALWAYS do it they reduce their overall survival rate below optimal- sometimes you must attack from the risky direction in order to maximize safety.
Another less formal example is Poker, bluffing is clearly risky, but never bluffing is unlikely to be optimal. Bluffing allows you to potentially win with a bad hand, a double bluff allows you to potentially win more than otherwise with a good hand. A player who never ever bluffs is entirely predictable. A player who never bluffs and doesn't believe that any other player ever bluffs because they think bluffing is illogical is somebody I'd like to play against.
SImilarly overbidding may allow you to 'win' in an auction where the asset has relatively low value to you by making your competitor overpay, the equivalent of a double bluff may allow you to 'win' an auction by acquiring the asset for less than its worth to you, by convincing your competitor you are overbidding. I'm scarequoting 'win' here to indicate I'm talking about winning the game, not just winning the asset.
I can go looking around the web and come up with links too. But you have to understand the situation, which you clearly do not. You can state game theory all you want to, but it's easy to see that your use of it is superficial. Game theory is very interesting in a general sense, but each individual case is different, and unique.
In any case, it comes down to several things. How much is this worth to us? How much can we afford? How much is it worth to keep out of the hands of a hostile competitor, etc. In the heat of an actual auction, these questions are much more important than theoretical musings.
You look to future sales, and how they could be impacted several ways. Yu look to future profits and how they can be impacted several ways. You look to what this means in terms of marketshare, and how that impacts sales and profits. It's a balancing act, and something arch company must do on it's own. That's why each company paid differing amounts, and for differing parts of the portfolio, as well as to access to other parts.
Which is exactly why I originally said zero-sum context, and not zero sum-game. Ok, to make you happy let me put it more precisely. I am stipulating that Google's score and Apple's score are inversely related. You are apparently assuming that the underbidder's score is zero and the asset winner's is Bid-Value, though Value of course may only be known in hindsight.
There is no such thing as zero sum context. Either it is or it isn't. Here, one side won, and the other lost. There is no zero sum anything. There is no current way to evaluate it. It will take years.
As to MS, it's really unclear what is going to happen. Are they content to become a patent troll under the smartphone bridge? Will they keep pushing WP7? If it fails will they push Windows 8? Are consumers interested at all? There seems a shocking lack of interest in both WP7 and WebOS from consumers. I guess we'll find out if WP7 has any legs at all when Nokia starts to kick out models.
Posters love to call every company that has IP, and attempts to get paid for it, a patent troll, but that's just silly. There are hundreds of thousands of patents, if not millions, that are licensed out. Is IBM a patent troll because they receive billions every year in patent fees? Of course not! Neither are most of the other thousands of companies and individuals who invent something, and are getting fees for it.
So is MS a patent troll? Not really. They've invented much themselves, And buying more patents doesn't make them trolls. If someone invents something, no one else has the right to take it and use it without paying for it, assuming that the invention is valid, which most, but not all are.
If I invent something, and patent it, but can't get the money to make it, and can't convince other companies to do so, and then find that someone Is making it without coming to me for a license, and I sue, am I a patent troll? Of course not! But this happens all the time. And often, companies invent many things in the course of their R&D, but decide that they don't need them now. Does that mean that another company should can steal that IP for themselves? Again, of course not.
As to Samsung and WebOS, I don't think that would be a defensive play regarding MS. The logical defensive play there would be to jump to WP7, which is what MS is no doubt angling for, and probably offering reduced license terms for OEMs that do. WebOS seems more likely a poke on Google's nose to try to get them to partner more closely with Samsung. As I understand it, each Android revision gets launched on an exclusive with a partner, and these deals are extremely lucrative in both cash and marketshare.
I knew that wouldn't think so, but your response makes even less sense. Dealing with HP could be a counterweight to both MS, Google, and of course, Apple. We also don't know what HP might be asking for fees. I suspect, though of course it's just my take, that HP would be asking for less than MS is demanding. Hp announced some time ago that WebOS would be offered for licensing, and people laughed, think that no one would be interested, because of its tiny take-up. But perhaps they were wrong.
As for Samsung dealing with MS to make WP7 phones, and so getting a better deal than the $15 MS is demanding, well... Samsung ALREADY makes WP7 phones, for your information, and still, they're being smacked down by MS.