In fact, he makes an excellent case for avoiding horizontal business models altogether. Once an OS is whored to to every OEM under the sun, User Experience goes out the window. Anyone who licenses out the very heart and soul of a device (the OS) has a fundamental disrespect for their product, and consequently the user.
There's a reason Apple controls the whole widget. It can be found in the Consumer Satisfaction reports year after year.
I agree here. And i ain't no Apple defender, you can check my posts to see.
If they get away with this, then Best buy must be infringing too, since they sell the ipad that has the chip that has the patent (OK, bad example, but so what). The line has to stop somewhere.
EDIT: Just thought of better analogy!!!
Its like if someone selling custom made computers has to pay MPEG-LA for a license for video codecs even though they already paid for the copy of windows to put on the machine. BOOOM!!! I'm an analogy GENIUS!!!
Or if your friend bought a computer with the patent royalties included in the price, and they you bought the computer second-hand off your friend then you'd have to pay the royalties to Samsung because you're using them now. They're already trying to do this with video games, why not patents?
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
Exactly. If Qualcomm pays a royalty to Samsung/Google/Motorola for FRAND patents needed to make their communications chips comply with telecom standards, then why should Apple also have to pay a royalty. Qualcomm would cover the costs in what they charge Apple for the chips.
In regards to the "one bullet to kill" argument - I bet there are a lot of "bullets" in the package of FRAND patents that if not included would make it impossible to implement the industry standard. There are other companies with bullets too.
The use of FRAND patents was not what this trial was about - it was about Apple claiming Samsung copied design elements and items Apple has patented related to the user experience and features in iOS. Samsung seems to be attempting to blackmail Apple into giving in on non-FRAND patents by charging extreme rates for their "bullets".
It would be interesting to know what Samsung charges other companies besides Apple and Microsoft for royalties on the FRAND patents.
Or if your friend bought a computer with the patent royalties included in the price, and they you bought the computer second-hand off your friend then you'd have to pay the royalties to Samsung because you're using them now. They're already trying to do this with video games, why not patents?
According to patent articles, many of those FRAND patents are tied to the price (sometimes wholesale price, sometimes BOM, sometimes "other") of a finished consumer device. It's not a royalty charge to the end-user directly, so it matters not how often it gets resold.
"ITC Judge Shaw blocked Motorola's efforts to seek a US import injunction against Microsoft for refusing to pay Motorola's 2.25 percent demands, noting that, "the evidence shows that the royalty rate offered by Motorola of 2.25%, both as to its amount and the products covered, could not possibly have been accepted by Microsoft," and that "the evidence supports Microsoft's conclusion that Motorola was not interested in good faith negotiations and in extending a [F]RAND license to it.""
Gatorguy, was it you I was arguing about this with in another thread yesterday or someone else? It looks like the 2.25% has been shot down somewhere else before. That graphic w/the 4B vs the 60M was pretty great too
"ITC Judge Shaw blocked Motorola's efforts to seek a US import injunction against Microsoft for refusing to pay Motorola's 2.25 percent demands, noting that, "the evidence shows that the royalty rate offered by Motorola of 2.25%, both as to its amount and the products covered, could not possibly have been accepted by Microsoft," and that "the evidence supports Microsoft's conclusion that Motorola was not interested in good faith negotiations and in extending a [F]RAND license to it.""
Gatorguy, was it you I was arguing about this with in another thread yesterday or someone else? It looks like the 2.25% has been shot down somewhere else before. That graphic w/the 4B vs the 60M was pretty great too
Yes that was me. Two different judge's in two different venues and for two different purposes seeking two different actions.This one was seeking an exclusion order ("import injunction") from the ITC. The post I made yesterday referenced the Federal case in a June 6th ruling, linked here:
In the Motorola Microsoft lawsuit over licensing of standards-essential patents, Motorola submitted a spreadsheet with 50 licensees listed paying that 2.25% royalty or thereabouts based on the cost of a completed end-user device.
See page 22, line 19 thru page 23, line 4 and especially page 26, beginning line 7 thru page 27, line 21.
Mueller is a Microsoft and Oracle paid shill. He can't possibly be the only patent analyst on the planet. Does he really need to be quoted in every article? Honestly.
2.25 percent royalty rate is illogical and pretty absurd though.
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
The device can be argued as the thing that uses it. Let's say Qualcomm provides several parts to Apple for the iphone. These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee. Anyway many of these things are negotiated down by cross licensing patents. Regarding a percentage basis for the device as a whole, it helps prevent a high cost barrier for lower cost devices.
Quote:
Originally Posted by UIGuy
I have been under the impression that FRAND is used to describe Fair, Reasonable, and Non-Discriminatory licensing terms. As mentioned above, the terms must be the same for everyone.
The argument has been that the initial offer is calculated on the same basis, in this case a percentage rather than a dollar amount.
Quote:
Originally Posted by Quadra 610
I'm sure he does. Because he's 100% correct.
In fact, he makes an excellent case for avoiding horizontal business models altogether. Once an OS is whored to to every OEM under the sun, User Experience goes out the window. Anyone who licenses out the very heart and soul of a device (the OS) has a fundamental disrespect for their product, and consequently the user.
There's a reason Apple controls the whole widget. It can be found in the Consumer Satisfaction reports year after year.
This is what annoys me with your posts at times. When presenting something as factual, you should avoid putting a spin on it. Saying something is "whored" automatically applies a negative connotation without improving upon the amount of information delivered.
The device can be argued as the thing that uses it. Let's say Qualcomm provides several parts to Apple for the iphone. These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee. Anyway many of these things are negotiated down by cross licensing patents. Regarding a percentage basis for the device as a whole, it helps prevent a high cost barrier for lower cost devices.
The argument has been that the initial offer is calculated on the same basis, in this case a percentage rather than a dollar amount.
This is what annoys me with your posts at times. When presenting something as factual, you should avoid putting a spin on it. Saying something is "whored" automatically applies a negative connotation without improving upon the amount of information delivered.
In some cases Groklaw will report a lot more details than Mr. Mueller, even going so far as to re-post the actual court transcripts. I find that very helpful as it puts the comments and questions from cases in context rather than relying on someone else's spin on the facts they want you or me to know.
Such as the spin lawyers are paid to put on things and the "witnesses" they pay to help them?
Yes that was me. Two different judge's in two different venues and for two different purposes seeking two different actions.This one was seeking an exclusion order ("import injunction") from the ITC. The post I made yesterday referenced the Federal case in a June 6th ruling, linked here:
In the Motorola Microsoft lawsuit over licensing of standards-essential patents, Motorola submitted a spreadsheet with 50 licensees listed paying that 2.25% royalty or thereabouts based on the cost of a completed end-user device.
See page 22, line 19 thru page 23, line 4 and especially page 26, beginning line 7 thru page 27, line 21.
For those too busy to read, here's the part concerning the court's acceptance of Motorola's 2.25% royalty as a good-faith offer as well as being their standard rate.
"Here, Motorola has presented the court with numerous licensing agreements suggesting that it has received comparable (2.25%) royalty rates to those offered to Microsoft from other licensees for some, if not most, of its patents essential to the 802.11Standard and the H.264 Standard.
...Additionally, at the summary judgment stage, the court finds unpersuasive Microsoft’s assertion that Motorola’s 802.11 and H.264 Standard essential patentportfolios cover only a minimal part of the technology involved in the 802.11 and H.264Standards. Microsoft has provided the court no evidence to support this assertion...
Microsoft has only offered testimony tending to show that Motorola understood the financial impact of its offers. This showing, on its own, however, does not establish that Motorola was acting dishonestly.. . Indeed, Motorola offered on its standard terms (of 2.25% of the device cost)."
These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee.
Wrong.
Qualcomm pays the license, then sell licensed chips to manufacturers who use them.
The manufacturer cannot "shift a significant portion" of the cost into other components as it is already paid.
2.25 percent royalty rate is illogical and pretty absurd though.
Perhaps not. If its off the value of the finished product sure, but if it is off the price of the chip that uses said patent that is reasonable and if the same rate on the same chip is charged to everyone that is non discriminatory. If it is the agreed upon most important patent in the pack then the rate could be fair.
But if it is off the value of the finished good and/or not the same rate for everyone then FRAND compliance may not be fulfilled. And I suspect that that is what Apple is arguing. That it is not fair for them to try to license off the value of the whole item or that they are asking for a way higher rate because it's Apple. Or even perhaps both
Perhaps not. If its off the value of the finished product sure, but if it is off the price of the chip that uses said patent that is reasonable and if the same rate on the same chip is charged to everyone that is non discriminatory. If it is the agreed upon most important patent in the pack then the rate could be fair.
But if it is off the value of the finished good and/or not the same rate for everyone then FRAND compliance may not be fulfilled. And I suspect that that is what Apple is arguing. That it is not fair for them to try to license off the value of the whole item or that they are asking for a way higher rate because it's Apple. Or even perhaps both
Apple and Microsoft, Motorola's projected $4 Billion PA in income from each must have been quite enticing to the sucker they got to buy them for $12.5 Billion.
Motorola attempted to void the license agreements with the chipmakers which covered Apple and Microsoft, hence the breach of contract allegations.
Now Google has no choice but to become the lowest of the low patent trolls they were vehemently dismissing only a few short years ago.
Of course if they had any principles whatsoever they could get Motorola to withdraw.
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
The general principle in agreement with you here is called "The Exhaustion Doctrine" for patents,
akin to the First-Sale Doctrine for copyright. See:
whereby collection for patent royalties is done at the most basic part level. Hardware company
cross-licensing often eases the burden for the consumer, by not passing through possibly dozens, hundreds, or thousands of individual royalties to the end-user. However, rogues/trolls routinely ignore this principle by referring to the shibboleth that thou shalt not "make, use, or sell" a patented "device" without
paying the toll, so they typically press their case against the deepest pocket.
I think Judge Richard Posner is right-on with how broken the patent system is for software.
Older industries such as auto manufacturing long ago thought is was better to save the industry from rampant
legal costs by cross-licencing, which at least somewhat preserves high barriers-to-entry.
Pharmaceutical companies also generally practice "honor among thieves". The more nascent
purveyors of software (general-purpose or otherwise) need to be schooled by this fire.
whereby collection for patent royalties is done at the most basic part level. Hardware company
cross-licensing often eases the burden for the consumer, by not passing through possibly dozens, hundreds, or thousands of individual royalties to the end-user. However, rogues/trolls routinely ignore this principle by referring to the shibboleth that thou shalt not "make, use, or sell" a patented "device" without
paying the toll, so they typically press their case against the deepest pocket.
I think Judge Richard Posner is right-on with how broken the patent system is for software.
Older industries such as auto manufacturing long ago thought is was better to save the industry from rampant
legal costs by cross-licencing, which at least somewhat preserves high barriers-to-entry.
Pharmaceutical companies also generally practice "honor among thieves". The more nascent
purveyors of software (general-purpose or otherwise) need to be schooled by this fire.
Yes, it appeared that Motorola wanted to move the royalty point from the chip with Qualcomm onto the end product itself thus greatly increasing the amount collected.
Yes, it appeared that Motorola wanted to move the royalty point from the chip with Qualcomm onto the end product itself thus greatly increasing the amount collected.
The royalty was almost certain to have always been based on the completed device and not just a chipset. Qualcomm's royalty basis is also a finished end-user device according to their licensing statement.
BTW as far as a reason that Motorola pulled licensing away from Qualcomm? Perhaps it' could be that they stopped collecting royalties on behalf of Broadcomm, Motorola. Kyocera, Samsung, etc if the sale delivery was to an overseas client, perhaps someone like FOXCONN, even tho the sale may have been to a US customer, perhaps someone like Apple. Qualcomm wasn't paying any agreed upon royalties on those sales, in violation of their contract with the IP holder.
So Motorola's action to pull the agreement with Qualcomm may not have been aimed at Apple alone. Qualcomm was trying to sneak a little extra profit in for themselves by claiming overseas sales didn't apply to their 3rd party royalty agreements, and besides it was only for things like wireless radios anyway. The court didn't agree, slapping Qualcomm with a contempt charge.
"It defended its actions by saying that although orders from AnyData, Kyocera, LG, Motorola, and Samsung were indeed placed in the United States, shipments of parts were not to the United States; and exactly what these customers do with those parts after they put them in cell phones and handsets, is something Qualcomm can't exactly track."
"Furthermore, Qualcomm said it thought the injunction only applied to CDMA2000- and EV-DO-related chipsets that would be used in devices with wireless radios, not any other class of device (ie smartphone) that customers might have in mind.
Yesterday, Judge Selna didn't buy those arguments, deciding to hold Qualcomm in contempt of the injunction order. As a result, he penalized Qualcomm as much as $1.86 million in back royalties, payable within 60 days. Qualcomm was also ordered to retrieve any chips currently in transit sold to unallowed, ornon-sunset, customers within 45 days."
Comments
Quote:
Originally Posted by Blitz1
Feeling better?
I'm sure he does. Because he's 100% correct.
In fact, he makes an excellent case for avoiding horizontal business models altogether. Once an OS is whored to to every OEM under the sun, User Experience goes out the window. Anyone who licenses out the very heart and soul of a device (the OS) has a fundamental disrespect for their product, and consequently the user.
There's a reason Apple controls the whole widget. It can be found in the Consumer Satisfaction reports year after year.
Quote:
Originally Posted by sleepy3
I agree here. And i ain't no Apple defender, you can check my posts to see.
If they get away with this, then Best buy must be infringing too, since they sell the ipad that has the chip that has the patent (OK, bad example, but so what). The line has to stop somewhere.
EDIT: Just thought of better analogy!!!
Its like if someone selling custom made computers has to pay MPEG-LA for a license for video codecs even though they already paid for the copy of windows to put on the machine. BOOOM!!! I'm an analogy GENIUS!!!
Or if your friend bought a computer with the patent royalties included in the price, and they you bought the computer second-hand off your friend then you'd have to pay the royalties to Samsung because you're using them now. They're already trying to do this with video games, why not patents?
Quote:
Originally Posted by icoco3
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
Exactly. If Qualcomm pays a royalty to Samsung/Google/Motorola for FRAND patents needed to make their communications chips comply with telecom standards, then why should Apple also have to pay a royalty. Qualcomm would cover the costs in what they charge Apple for the chips.
In regards to the "one bullet to kill" argument - I bet there are a lot of "bullets" in the package of FRAND patents that if not included would make it impossible to implement the industry standard. There are other companies with bullets too.
The use of FRAND patents was not what this trial was about - it was about Apple claiming Samsung copied design elements and items Apple has patented related to the user experience and features in iOS. Samsung seems to be attempting to blackmail Apple into giving in on non-FRAND patents by charging extreme rates for their "bullets".
It would be interesting to know what Samsung charges other companies besides Apple and Microsoft for royalties on the FRAND patents.
Quote:
Originally Posted by silverpraxis
Or if your friend bought a computer with the patent royalties included in the price, and they you bought the computer second-hand off your friend then you'd have to pay the royalties to Samsung because you're using them now. They're already trying to do this with video games, why not patents?
According to patent articles, many of those FRAND patents are tied to the price (sometimes wholesale price, sometimes BOM, sometimes "other") of a finished consumer device. It's not a royalty charge to the end-user directly, so it matters not how often it gets resold.
From the article:
"ITC Judge Shaw blocked Motorola's efforts to seek a US import injunction against Microsoft for refusing to pay Motorola's 2.25 percent demands, noting that, "the evidence shows that the royalty rate offered by Motorola of 2.25%, both as to its amount and the products covered, could not possibly have been accepted by Microsoft," and that "the evidence supports Microsoft's conclusion that Motorola was not interested in good faith negotiations and in extending a [F]RAND license to it.""
Gatorguy, was it you I was arguing about this with in another thread yesterday or someone else? It looks like the 2.25% has been shot down somewhere else before. That graphic w/the 4B vs the 60M was pretty great too
Quote:
Originally Posted by SSquirrel
From the article:
"ITC Judge Shaw blocked Motorola's efforts to seek a US import injunction against Microsoft for refusing to pay Motorola's 2.25 percent demands, noting that, "the evidence shows that the royalty rate offered by Motorola of 2.25%, both as to its amount and the products covered, could not possibly have been accepted by Microsoft," and that "the evidence supports Microsoft's conclusion that Motorola was not interested in good faith negotiations and in extending a [F]RAND license to it.""
Gatorguy, was it you I was arguing about this with in another thread yesterday or someone else? It looks like the 2.25% has been shot down somewhere else before. That graphic w/the 4B vs the 60M was pretty great too
Yes that was me. Two different judge's in two different venues and for two different purposes seeking two different actions.This one was seeking an exclusion order ("import injunction") from the ITC. The post I made yesterday referenced the Federal case in a June 6th ruling, linked here:
http://www.scribd.com/doc/96228673/Microsoft-Motorola-Xbox-6-6-12
In the Motorola Microsoft lawsuit over licensing of standards-essential patents, Motorola submitted a spreadsheet with 50 licensees listed paying that 2.25% royalty or thereabouts based on the cost of a completed end-user device.
See page 22, line 19 thru page 23, line 4 and especially page 26, beginning line 7 thru page 27, line 21.
Quote:
Originally Posted by thataveragejoe
Mueller is a Microsoft and Oracle paid shill. He can't possibly be the only patent analyst on the planet. Does he really need to be quoted in every article? Honestly.
2.25 percent royalty rate is illogical and pretty absurd though.
Mueller now works for Google.
Quote:
Originally Posted by icoco3
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
The device can be argued as the thing that uses it. Let's say Qualcomm provides several parts to Apple for the iphone. These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee. Anyway many of these things are negotiated down by cross licensing patents. Regarding a percentage basis for the device as a whole, it helps prevent a high cost barrier for lower cost devices.
Quote:
Originally Posted by UIGuy
I have been under the impression that FRAND is used to describe Fair, Reasonable, and Non-Discriminatory licensing terms. As mentioned above, the terms must be the same for everyone.
The argument has been that the initial offer is calculated on the same basis, in this case a percentage rather than a dollar amount.
Quote:
Originally Posted by Quadra 610
I'm sure he does. Because he's 100% correct.
In fact, he makes an excellent case for avoiding horizontal business models altogether. Once an OS is whored to to every OEM under the sun, User Experience goes out the window. Anyone who licenses out the very heart and soul of a device (the OS) has a fundamental disrespect for their product, and consequently the user.
There's a reason Apple controls the whole widget. It can be found in the Consumer Satisfaction reports year after year.
This is what annoys me with your posts at times. When presenting something as factual, you should avoid putting a spin on it. Saying something is "whored" automatically applies a negative connotation without improving upon the amount of information delivered.
Quote:
Originally Posted by hmm
The device can be argued as the thing that uses it. Let's say Qualcomm provides several parts to Apple for the iphone. These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee. Anyway many of these things are negotiated down by cross licensing patents. Regarding a percentage basis for the device as a whole, it helps prevent a high cost barrier for lower cost devices.
The argument has been that the initial offer is calculated on the same basis, in this case a percentage rather than a dollar amount.
This is what annoys me with your posts at times. When presenting something as factual, you should avoid putting a spin on it. Saying something is "whored" automatically applies a negative connotation without improving upon the amount of information delivered.
Would you prefer pimping, instead?
Quote:
Originally Posted by Gatorguy
In some cases Groklaw will report a lot more details than Mr. Mueller, even going so far as to re-post the actual court transcripts. I find that very helpful as it puts the comments and questions from cases in context rather than relying on someone else's spin on the facts they want you or me to know.
Such as the spin lawyers are paid to put on things and the "witnesses" they pay to help them?
Quote:
Originally Posted by hill60
Such as the spin lawyers are paid to put on things and the "witnesses" they pay to help them?
You got at least part of it. $500-$1000 an hour for "expert witnesses" should get you something in return.
Quote:
Originally Posted by Gatorguy
Yes that was me. Two different judge's in two different venues and for two different purposes seeking two different actions.This one was seeking an exclusion order ("import injunction") from the ITC. The post I made yesterday referenced the Federal case in a June 6th ruling, linked here:
http://www.scribd.com/doc/96228673/Microsoft-Motorola-Xbox-6-6-12
In the Motorola Microsoft lawsuit over licensing of standards-essential patents, Motorola submitted a spreadsheet with 50 licensees listed paying that 2.25% royalty or thereabouts based on the cost of a completed end-user device.
See page 22, line 19 thru page 23, line 4 and especially page 26, beginning line 7 thru page 27, line 21.
For those too busy to read, here's the part concerning the court's acceptance of Motorola's 2.25% royalty as a good-faith offer as well as being their standard rate.
"Here, Motorola has presented the court with numerous licensing agreements suggesting that it has received comparable (2.25%) royalty rates to those offered to Microsoft from other licensees for some, if not most, of its patents essential to the 802.11Standard and the H.264 Standard.
...Additionally, at the summary judgment stage, the court finds unpersuasive Microsoft’s assertion that Motorola’s 802.11 and H.264 Standard essential patentportfolios cover only a minimal part of the technology involved in the 802.11 and H.264Standards. Microsoft has provided the court no evidence to support this assertion...
Microsoft has only offered testimony tending to show that Motorola understood the financial impact of its offers. This showing, on its own, however, does not establish that Motorola was acting dishonestly.. . Indeed, Motorola offered on its standard terms (of 2.25% of the device cost)."
Quote:
Originally Posted by hmm
These total to a specific amount per device, but one of the parts has an associated patent fee. They could shift a significant portion of what they would have charged for that component into one of the others, thus circumventing the licensing fee.
Wrong.
Qualcomm pays the license, then sell licensed chips to manufacturers who use them.
The manufacturer cannot "shift a significant portion" of the cost into other components as it is already paid.
Perhaps not. If its off the value of the finished product sure, but if it is off the price of the chip that uses said patent that is reasonable and if the same rate on the same chip is charged to everyone that is non discriminatory. If it is the agreed upon most important patent in the pack then the rate could be fair.
But if it is off the value of the finished good and/or not the same rate for everyone then FRAND compliance may not be fulfilled. And I suspect that that is what Apple is arguing. That it is not fair for them to try to license off the value of the whole item or that they are asking for a way higher rate because it's Apple. Or even perhaps both
Quote:
Originally Posted by hmm
Saying something is "whored" automatically applies a negative connotation.
As intended.
Quote:
Originally Posted by charlituna
Perhaps not. If its off the value of the finished product sure, but if it is off the price of the chip that uses said patent that is reasonable and if the same rate on the same chip is charged to everyone that is non discriminatory. If it is the agreed upon most important patent in the pack then the rate could be fair.
But if it is off the value of the finished good and/or not the same rate for everyone then FRAND compliance may not be fulfilled. And I suspect that that is what Apple is arguing. That it is not fair for them to try to license off the value of the whole item or that they are asking for a way higher rate because it's Apple. Or even perhaps both
Apple and Microsoft, Motorola's projected $4 Billion PA in income from each must have been quite enticing to the sucker they got to buy them for $12.5 Billion.
Motorola attempted to void the license agreements with the chipmakers which covered Apple and Microsoft, hence the breach of contract allegations.
Now Google has no choice but to become the lowest of the low patent trolls they were vehemently dismissing only a few short years ago.
Of course if they had any principles whatsoever they could get Motorola to withdraw.
Quote:
Originally Posted by icoco3
To this day, I do not see how in the world a patent royalty can be charged against a finished product. It should be applied to whoever makes the actual chip that is bought and placed into a product. Is someone just getting greedy?
The general principle in agreement with you here is called "The Exhaustion Doctrine" for patents,
akin to the First-Sale Doctrine for copyright. See:
http://en.wikipedia.org/wiki/Exhaustion_doctrine
whereby collection for patent royalties is done at the most basic part level. Hardware company
cross-licensing often eases the burden for the consumer, by not passing through possibly dozens, hundreds, or thousands of individual royalties to the end-user. However, rogues/trolls routinely ignore this principle by referring to the shibboleth that thou shalt not "make, use, or sell" a patented "device" without
paying the toll, so they typically press their case against the deepest pocket.
I think Judge Richard Posner is right-on with how broken the patent system is for software.
Older industries such as auto manufacturing long ago thought is was better to save the industry from rampant
legal costs by cross-licencing, which at least somewhat preserves high barriers-to-entry.
Pharmaceutical companies also generally practice "honor among thieves". The more nascent
purveyors of software (general-purpose or otherwise) need to be schooled by this fire.
Quote:
Originally Posted by retiarius
The general principle in agreement with you here is called "The Exhaustion Doctrine" for patents,
akin to the First-Sale Doctrine for copyright. See:
http://en.wikipedia.org/wiki/Exhaustion_doctrine
whereby collection for patent royalties is done at the most basic part level. Hardware company
cross-licensing often eases the burden for the consumer, by not passing through possibly dozens, hundreds, or thousands of individual royalties to the end-user. However, rogues/trolls routinely ignore this principle by referring to the shibboleth that thou shalt not "make, use, or sell" a patented "device" without
paying the toll, so they typically press their case against the deepest pocket.
I think Judge Richard Posner is right-on with how broken the patent system is for software.
Older industries such as auto manufacturing long ago thought is was better to save the industry from rampant
legal costs by cross-licencing, which at least somewhat preserves high barriers-to-entry.
Pharmaceutical companies also generally practice "honor among thieves". The more nascent
purveyors of software (general-purpose or otherwise) need to be schooled by this fire.
Yes, it appeared that Motorola wanted to move the royalty point from the chip with Qualcomm onto the end product itself thus greatly increasing the amount collected.
Quote:
Originally Posted by icoco3
Yes, it appeared that Motorola wanted to move the royalty point from the chip with Qualcomm onto the end product itself thus greatly increasing the amount collected.
The royalty was almost certain to have always been based on the completed device and not just a chipset. Qualcomm's royalty basis is also a finished end-user device according to their licensing statement.
BTW as far as a reason that Motorola pulled licensing away from Qualcomm? Perhaps it' could be that they stopped collecting royalties on behalf of Broadcomm, Motorola. Kyocera, Samsung, etc if the sale delivery was to an overseas client, perhaps someone like FOXCONN, even tho the sale may have been to a US customer, perhaps someone like Apple. Qualcomm wasn't paying any agreed upon royalties on those sales, in violation of their contract with the IP holder.
So Motorola's action to pull the agreement with Qualcomm may not have been aimed at Apple alone. Qualcomm was trying to sneak a little extra profit in for themselves by claiming overseas sales didn't apply to their 3rd party royalty agreements, and besides it was only for things like wireless radios anyway. The court didn't agree, slapping Qualcomm with a contempt charge.
"It defended its actions by saying that although orders from AnyData, Kyocera, LG, Motorola, and Samsung were indeed placed in the United States, shipments of parts were not to the United States; and exactly what these customers do with those parts after they put them in cell phones and handsets, is something Qualcomm can't exactly track."
"Furthermore, Qualcomm said it thought the injunction only applied to CDMA2000- and EV-DO-related chipsets that would be used in devices with wireless radios, not any other class of device (ie smartphone) that customers might have in mind.
Yesterday, Judge Selna didn't buy those arguments, deciding to hold Qualcomm in contempt of the injunction order. As a result, he penalized Qualcomm as much as $1.86 million in back royalties, payable within 60 days. Qualcomm was also ordered to retrieve any chips currently in transit sold to unallowed, ornon-sunset, customers within 45 days."
http://betanews.com/2008/11/18/qualcomm-hit-with-contempt-of-injunction-in-broadcom-case/