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Justice Department approves Apple's purchases of Nortel, Novell patents

post #1 of 14
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The U.S. Department of Justice approved on Monday several patent purchases and acquisitions, including a collection of Nortel's intellectual property to be acquired by Apple, Microsoft, Research in Motion and others and Novell patents that Apple has purchased.

The federal agency issued a statement on Monday announcing that it was closing its investigations of the Nortel deal and Apple's acquisition of the Novell patents. It also revealed that it was giving Google the go-ahead for its $12.5 billion acquisition of Motorola Mobility.

Nortel

Google and Apple squared off last year in a bidding war over a trove of more than 6,000 patents from bankrupt Canadian telecommunications equipment maker Nortel. The patents had attracted an unusual level of interest because they were believed to be essential to the 4G Long-Term Evolution wireless standard.

After the dust settled, Apple and a consortium of companies including Ericsson, Research in Motion, Microsoft, Sony and EMC emerged the winners with Google and Intel on the losing side. The winning bid was $4.5 billion, more than three times the price that some analysts had expected, with Apple's share of the purchase coming to a hefty $2.6 billion.

The Department of Justice subsequently conducted a "thorough review" of the transaction because it contained standard essential patents (SEPs) that the agency feared could be wielded by the purchasing companies against their competitors. The investigation ultimately came to the conclusion that the transition was not "likely to significantly change existing market dynamics."

Microsoft and Apple aided their own cause by publicly expressing their commitment to uphold Fair, Reasonable and Non-Discriminatory (FRAND) patent commitments. The DoJ specifically cited a November letter from Apple to the European Telecommunications Standards Institute that recently came to light.

“A party who made a FRAND commitment to license its cellular standards essential patents or otherwise acquired assets/rights from a party who made the FRAND commitment must not seek injunctive relief on such patents. Seeking an injunction would be a violation of the party’s commitment to FRAND licensing,” Apple wrote.

The agency noted Microsoft's support for Apple's proposals for standards essential patents. The Redmond, Wash., company went on record last week with a commitment to "always adhere to the promises it has made" to licenses its SEPs on FRAND terms.

Also taken into consideration was the fact that Research in Motion and Microsoft have been dwarfed by Apple and Google in terms of market share in the wireless industry. "Their low market shares in mobile platforms would likely make a strategy to harm rivals either through injunctions or supracompetitive royalties based on the acquired Nortel SEPs unprofitable," the agency said in its statement.

Microsoft's existing cross-license agreements with more than half of the Android market were also cited as a reason that the Nortel deal wouldn't adversely affect competition. With licensing agreements from Samsung and HTC, the Windows Phone maker is said to make more money off the Android platform than its own mobile OS.

The DoJ did note that Apple was in a position to benefit from "[excluding] Android-based phones from the market or [raising] the costs of such phones through IP-licenses or patent litigation," but it was content with the company's commitment not to seek injunctions on FRAND-committed patents.

Shortly after the Nortel auction closed, Google, which had expressed an early interest in the patents, called the auction's results "disappointing for anyone who believes that open innovation benefits users and promotes creativity and competition." However, the Justice Department has worked to ensure that the search giant will, at the least, have an opportunity to license any of Nortel's patents that were committed to standard-setting organizations.

Novell

The agency also announced on Monday that it had completed its investigation of Apple's proposal to acquire patents originally owned by Novell. In 2010, Apple, Microsoft, Oracle and EMC banded together to purchase 882 patents from Novell by creating a consortium under the name CPTN Holdings. The plan faced some opposition over concerns that the patent acquisition would affect open source initiatives.

According to the DoJ statement, the division concluded that Apple's acquisition of the patents was "unlikely to harm competition." The agency's investigation determined that Apple would be unable to get out of Novell's original commitments to the Open Invention Network" or seek royalties from Linux users. Apple's expressed commitment to honor Novell's OIN licensing agreements served to reassure the DoJ.

For its part, Google cited the Novell patent purchase last year in accusations that Apple and Microsoft were waging an "organized campaign" against its Android operating system. However, Microsoft quickly fired back by noting that Google had turned down an invitation to jointly bid on the Novell patents.

The members of the CPTN consortium have claimed that they purchased the Novell patents to keep them out of the hands of patent trolls.

[ View article on AppleInsider ]
post #2 of 14
You know, I used to think that all these patent suits were just lawyers making a buck.

But in reality, IP truly is the basis for so much with tech companies.

Perhaps defending its own patents and buying up others is what Apple's hundred billion is for after all.

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post #3 of 14
Quote:
Originally Posted by AppleInsider View Post

For its part, Google cited the Novell patent purchase last year in accusations that Apple and Microsoft were waging an "organized campaign" against its Android operating system. However, Microsoft quickly fired back by noting that Google had turned down an invitation to jointly bid on the Novell patents.

With Google's actions (as well as Motorola's actions which Google must approve), Google is coming across as incredibly hypocritical. They're opposed to patents when they belong to someone else, but if THEY own the patent, they should be able to charge extortionate license fees.

I guess Google is where all the Wall Street criminals went when they had to leave Wall Street.
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"I'm way over my head when it comes to technical issues like this"
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post #4 of 14
I guess these are a few patents that can’t be used against Apple in place of real competition and innovation! (I know some trolls will say that true competition is copying Apple, rather than bringing something new to the market.)

About a year ago, Apple was the most-sued tech company. These days, some people talk as though Apple sues others more than they get sued; any real numbers as evidence for that?

(Of course the merits of a suit matter more than how many there are.)
post #5 of 14
Quote:
Shortly after the Nortel auction closed, Google, which had expressed an early interest in the patents, called the auction's results "disappointing for anyone who believes that open innovation benefits users and promotes creativity and competition." However, the Justice Department has worked to ensure that the search giant will, at the least, have an opportunity to license any of Nortel's patents that were committed to standard-setting organizations.

Let me get this straight, having one company owning these patents makes it more open than having many companies owning them? That's a real head scratcher.
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post #6 of 14
Quote:
Originally Posted by jragosta View Post

With Google's actions (as well as Motorola's actions which Google must approve), Google is coming across as incredibly hypocritical. They're opposed to patents when they belong to someone else, but if THEY own the patent, they should be able to charge extortionate license fees.

I guess Google is where all the Wall Street criminals went when they had to leave Wall Street.

but google is 'open' and 'not evil' according to all the fandroids. LOL. I hope Apple sues Google to the ground for copying everything Apple does.
post #7 of 14
Quote:
Originally Posted by bullhead View Post

but google is 'open' and 'not evil' according to all the fandroids. LOL. I hope Apple sues Google to the ground for copying everything Apple does.

Oh Apple want's more then Google's money, the only question is whether they will use a lubricant or go in dry...
post #8 of 14
Quote:
Originally Posted by bullhead View Post

but google is 'open' and 'not evil' according to all the fandroids. LOL. I hope Apple sues Google to the ground for copying everything Apple does.

Apple suing Google directly might not fare well with parties on both sides. Google could retaliate immediately by shutting off all iOS access to Google Maps and Google Search (although probably not the wisest move by Google). Apple can only replace Google's services on their devices, but that would take time because of Apple's update model for pre-iOS 5 devices. Ultimately, no one wins but lawyers and Apple's and Google's brands would take a hit that would be almost impossible to recover from. Furthermore, there are a lot of Open Source advocates that are already getting annoyed with Apple (and Google in some parts) that would change their licenses on their software immediately leaving Apple with outdated software or forced to recreate the OS X and iOS innards from scratch.

Ultimately, neither of these tech giants are going to sue each other, but if they did, Google wouldn't be hurt from banning the distribution of Android as 98% of their revenue is still from search. Apple could be damaged immensely from the banning of their mobile devices as a result from a silly patent dispute. Furthermore, let's hope that Apple's search functions built into Apple's website, iTunes, and App Store don't violate Google's search patents or we could see 50% of Apple's revenue at risk, or digital content just got a lot harder to find. I do see these two suing each other in proxy, e.g. Motorola sues Apple, Apple sues Samsung, patent troll sues them all, etc, sort of what's going on now.

Don't hope these two sue each other, hope that we get patent reform so these two can duke it out by one-uping each other so we all win. I don't need to tack on $5 to my iOS devices or my Android phones because these two are stuck with fiduciary duties to protect shareholder value by the way our outdated patent system is designed.
post #9 of 14
Quote:
Originally Posted by yeshuawatso View Post

... there are a lot of Open Source advocates that are already getting annoyed with Apple (and Google in some parts) that would change their licenses on their software immediately leaving Apple with outdated software or forced to recreate the OS X and iOS innards from scratch.

The licences used by Apple are BSD or similar. Not GPL. The Open source community has nothing to fear from Apple unless the Open source community tromps over patents Apple holds, or Apple's copyright on the iOS and MacOS X operating system. And for Apple's part, they're not hijacking open source software, but they don't contribute back the way OSS developers want them to (eg using version control systems instead of "here's our copy of the source, have fun.)

The closest the OSS community has to being threatened by Apple is with Quicktime/h.264 vs x264 project vs other companies (eg cisco,apple,oracle) patenting things committed to Open source projects. Submarine Patents.

Oracle's business model is the most conflicted with open source, which is why every OSS project they have has been forked for no other reason than to prevent Oracle from trying to extract licencing fees. Listen to the CEO of Oracle talk during business interviews, their first priority is maximizing monetization of their IP. This is why you see them going after Android, and if Google is going to lose big over any wars over Android it's going to be from Oracle.

Anything Apple lobs at Google over Android is going to be about copying the iOS experience, not the functionality.
post #10 of 14
Quote:
Originally Posted by Misa View Post

The licences used by Apple are BSD or similar. Not GPL. The Open source community has nothing to fear from Apple unless the Open source community tromps over patents Apple holds, or Apple's copyright on the iOS and MacOS X operating system. And for Apple's part, they're not hijacking open source software, but they don't contribute back the way OSS developers want them to (eg using version control systems instead of "here's our copy of the source, have fun.)

The closest the OSS community has to being threatened by Apple is with Quicktime/h.264 vs x264 project vs other companies (eg cisco,apple,oracle) patenting things committed to Open source projects. Submarine Patents.

Oracle's business model is the most conflicted with open source, which is why every OSS project they have has been forked for no other reason than to prevent Oracle from trying to extract licencing fees. Listen to the CEO of Oracle talk during business interviews, their first priority is maximizing monetization of their IP. This is why you see them going after Android, and if Google is going to lose big over any wars over Android it's going to be from Oracle.

Anything Apple lobs at Google over Android is going to be about copying the iOS experience, not the functionality.

What the hell are you talking about ?

CUPS, LLVM/Clang, WebKit, launchd, MacRuby, Darwin Streaming Server, Apple Lossless, Calender and Contacts Server implementation of CalDAV and CardDAV are all source available nightly.

The amount of stuff Apple is contributing with LLVM/Clang and WebKit alone is completely allowing people to developer for HTML 5 [Just ask Google who works closely with Apple on WebKit and LLVM] on the leading edge toolkit and to drop GCC completely, never mind CUPS funding and enhancements.

Sorry, but what you really want is Apple to give away QuartzXtreme, AppKit, QuickTime and Foundation Kit because for some reason you think FOSS has given back equivalent technologies.

Guess what? They haven't and never will.
post #11 of 14
The lawyers mount up and it Thermonuclear Time, BABY!!!

Hasta la vista, Google!!!!
post #12 of 14
FWIW, among the Nortel patents are many involved with Linux and open source. Apple has pledged to the DOJ not to change the nature of those agreements, not to ask for royalties on open source IP and not to seek injunctions on the open source related IP. All this is in the DOJ statement issued yesterday.
post #13 of 14
Why did Apple buy this guys? And pay so much money doing it?
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post #14 of 14
Quote:
Originally Posted by yeshuawatso View Post

Apple suing Google directly might not fare well with parties on both sides. Google could retaliate immediately by shutting off all iOS access to Google Maps and Google Search (although probably not the wisest move by Google). Apple can only replace Google's services on their devices, but that would take time because of Apple's update model for pre-iOS 5 devices. Ultimately, no one wins but lawyers and Apple's and Google's brands would take a hit that would be almost impossible to recover from.

while we are living in dream land, let me create my own reality....Apple could very easily turn off Google services and turn on say Microsofts although that would be dumb as Microsoft is no better. Google would hurt far worse from that than anything Google could do to Apple.



Quote:
Originally Posted by yeshuawatso View Post

Furthermore, there are a lot of Open Source advocates that are already getting annoyed with Apple (and Google in some parts) that would change their licenses on their software immediately leaving Apple with outdated software or forced to recreate the OS X and iOS innards from scratch.

LOL. so you have no clue how Open Source works. You think the BSD license could be retroactively revoked? LOL. Yeah....


Quote:
Originally Posted by yeshuawatso View Post

Ultimately, neither of these tech giants are going to sue each other, but if they did, Google wouldn't be hurt from banning the distribution of Android as 98% of their revenue is still from search. Apple could be damaged immensely from the banning of their mobile devices as a result from a silly patent dispute. Furthermore, let's hope that Apple's search functions built into Apple's website, iTunes, and App Store don't violate Google's search patents or we could see 50% of Apple's revenue at risk, or digital content just got a lot harder to find. I do see these two suing each other in proxy, e.g. Motorola sues Apple, Apple sues Samsung, patent troll sues them all, etc, sort of what's going on now.

Not sure what planet you live on, but on this one, they already have sued each other. Who owns Motorola? Google would be hurt big time if Android was banned...a huge portion of mobile search (the future) would dry up instantly. Search is the only way Google makes money. And Google has nothing in its search patents of use...they would have already sued Microsoft in retaliation for the Microsoft tax on Android.



Quote:
Originally Posted by yeshuawatso View Post

Don't hope these two sue each other, hope that we get patent reform so these two can duke it out by one-uping each other so we all win. I don't need to tack on $5 to my iOS devices or my Android phones because these two are stuck with fiduciary duties to protect shareholder value by the way our outdated patent system is designed.

I hope Apple sues all the copy cats out of existence. If Google did not copy everything Apple did, Apple would not have to defend its IP against the Google clone army.
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