Apple offered Samsung UMTS cross-licensing agreement prior to trial

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Comments

  • Reply 21 of 37
    jragostajragosta Posts: 10,473member
    tooltalk wrote: »
    so let me get this straight, Apple wants to charge $25 / per device for a handful of utility patents, but also wants to access Samsung's vast communication 3G/UTMS patents for pennies in exchange for Apple's meager collection of comm/tech patents?

    Why don't you look up some information on SEP and FRAND patents? What you just described is quite common - almost universal. When you make your patent FRAND, you are essentially agreeing that you will take less money per handset in exchange for having almost all handsets use your technology. If you don't use FRAND, you can ask for more money for your patent, but not everyone would use it. Samsung made their choice when they submitted their patents to the standards bodies.
  • Reply 22 of 37
    gatorguygatorguy Posts: 24,612member

    Quote:

    Originally Posted by jragosta View Post





    Why don't you look up some information on SEP and FRAND patents? What you just described is quite common - almost universal. When you make your patent FRAND, you are essentially agreeing that you will take less money per handset in exchange for having almost all handsets use your technology. If you don't use FRAND, you can ask for more money for your patent, but not everyone would use it. Samsung made their choice when they submitted their patents to the standards bodies.


    as apparently Apple and/or the previous owner of that IP did. From the article itself:


     


    Apple is willing to license its declared-essential UMTS patents to Samsung ...

  • Reply 23 of 37

    Quote:

    Originally Posted by souliisoul View Post


     


    Very much doubt that, Samsung know full well what is being questioned with concern to their behaviour and intentionally copying Apple products!



     


    Sure, but the PUBLIC has the perception that Apple "won't license" with anyone. And they are being fully and completely painted as patent trolls. It's the opposite of course; Samsung redesigned their phone to make it as close as possible to an iPhone, and they made $20 billion doing that. And they will do it again because the costs in court are still lower than going your own way like Blackberry.


     


    Samsung got to make money from a company they were in a privileged manufacturing agreement with by ripping off their designs -- and Apple wanted to come to the table with them ANYWAY.

  • Reply 24 of 37
    tooltalktooltalk Posts: 766member

    Quote:

    Originally Posted by jragosta View Post





    Why don't you look up some information on SEP and FRAND patents? What you just described is quite common - almost universal. When you make your patent FRAND, you are essentially agreeing that you will take less money per handset in exchange for having almost all handsets use your technology. If you don't use FRAND, you can ask for more money for your patent, but not everyone would use it. Samsung made their choice when they submitted their patents to the standards bodies.


     


    Well, there is nothing in FRAND / SEP dictating how much or what percentage patent holders can charge, is there?  The point of FRAND is to promote industry wide adoption by making their standard essential patents widely available for licensing & at fair, reasonable rates. Again, if Apple can charge around 20% for low-end Android phones for a handful utility patents, I don't see why 2.25% is unreasonable, unfair for FRAND patents?


     


    What's more uncommon is Apple's patent strategy - Apple and Jobs seemed to believe they are the only ones getting patents, while others are just copying their *innovative* ideas ( see Jonathan Schwartz blog : http://jonathanischwartz.wordpress.com/2010/03/09/good-artists-copy-great-artists-steal/ ). Most companies don't sue each other for trivial patents or at least settle before it ever goes to trial. Remember, Samsung wasn't interested at all in going after Apple until Apple's lawsuits last year.

  • Reply 25 of 37
    tooltalktooltalk Posts: 766member

    Quote:

    Originally Posted by Fake_William_Shatner View Post


     


    Sure, but the PUBLIC has the perception that Apple "won't license" with anyone. And they are being fully and completely painted as patent trolls. It's the opposite of course; Samsung redesigned their phone to make it as close as possible to an iPhone, and they made $20 billion doing that. And they will do it again because the costs in court are still lower than going your own way like Blackberry.


     


    Samsung got to make money from a company they were in a privileged manufacturing agreement with by ripping off their designs -- and Apple wanted to come to the table with them ANYWAY.





    Well, according to the court papers (Apple vs. Samsung), Apple made it clear that they don't license their core-patents, period.  Apple's patent offer to Samsung in 2010 largely consisted of non-core OS patents that had nothing to do with the recent lawsuit. That's just too bad that now Apple is trying to fight back Samsung with patents that Apple bought from Nortel & others. With $120+B in cash, Apple should seriously consider spending more on real technology R&D.

  • Reply 26 of 37
    icoco3icoco3 Posts: 1,474member

    Quote:

    Originally Posted by tooltalk View Post


     

    .... Remember, Samsung wasn't interested at all in going after Apple until Apple's lawsuits last year.


     


    Up until Apple began to assert their intellectual rights that is....

  • Reply 27 of 37
    desuserigndesuserign Posts: 1,316member


    For standards essential patents, the royalties/payments should all be built into the price of the chip. The value is in what the chip does and should be portable with the chip. Everyone (even if they are due a piece of the royalty) should pay the fee on a per chip basis and do whatever they want with the chip. The fees can then be split later, in a transparent way, by the entities that hold the patents. This is the way things are normally done and the only reason it isn't done in this case is because of ---


    ridiculous, childish politicking,


    bluster, lying, obfuscation


    bullying,wheedling,


    whining, and


    underwear-staing fear


    on the part of companies who


    want a winning lottery ticket rather than a royalty check,


    or


    have zero confidence in their ability to innovate and serve customers in the future.

  • Reply 28 of 37
    desuserigndesuserign Posts: 1,316member

    Quote:

    Originally Posted by tooltalk View Post


     


    Well, there is nothing in FRAND / SEP dictating how much or what percentage patent holders can charge, is there? 



     


    Actually, there is. the terms cannot be set to force unwanted cross-licesnsing, or purchase of unwanted patents. The aggregate rate charged also has to be reasonable. This is well understood.


     


    Quote:


    Again, if Apple can charge around 20% for low-end Android phones for a handful utility patents, I don't see why 2.25% is unreasonable, unfair for FRAND patents?



     


    Yup. They can. Those patents are not part of a standard and have not been put into a patent pool to be licensed under FRAND terms.


    Any patent owner can set the terms as they please for their non FRAND encumbered patents (althfhough they may still need to be nondiscriminatory in their dealings.)

  • Reply 29 of 37
    tooltalktooltalk Posts: 766member

    Quote:

    Originally Posted by DESuserIGN View Post


     


     


    Yup. They can. Those patents are not part of a standard and have not been put into a patent pool to be licensed under FRAND terms.


    Any patent owner can set the terms as they please for their non FRAND encumbered patents (althfhough they may still need to be nondiscriminatory in their dealings.)



     


    so what is that rate?

  • Reply 30 of 37
    Petrosy you a little confused. Licensing under FRAND doesn't work the way you think. It isn't you show me yours and I show you mine and if I got more than you you give me more. It works like this. I have this/these patents that are part of this STANDARD. By being part of the STANDARD I agree to license the patent/patents out to all others that wish to use the technology at a reasonable rate. Whether they have any sort of patents that I'm interested in is irrelevant. I'm not allowed to discriminate. I must treat all others that wish to licence the patents equally.

    Read the letter then let that info try to penetrate your cranium. If that doesn't work then go back to smoking your crack pipe.
  • Reply 31 of 37
    desuserigndesuserign Posts: 1,316member

    Quote:

    Originally Posted by tooltalk View Post


     


    so what is that rate?



    You said, ". . there is nothing in FRAND / SEP dictating how much or what percentage patent holders can charge, . . . "


     


    I said, "Yes, there is [something] . . . "


    No fixed rates, just prohibitions on coercive activities, virtually all of which Samsung attempted to employ.


    But don't trust me, just google "FRAND terms."


    Wikipedia has a nice entry that will inform the intelligent and motivated reader.


     


    [BTW, "Aggregate Rate," is an important and relevant concept to this case.]

  • Reply 32 of 37


    Easy there tiger "gimpymw"....you going to give yourself an ulcer!

  • Reply 33 of 37
    kdarlingkdarling Posts: 1,640member


    If you read the relevant ETSI IP standard for FRAND terms, they specifically allow for cross-licensing. 


     


    In fact, that used to be the only way that Motorola (who originally had over 50% of GSM patents) allowed the use of their IP.  Either you bought their chips with the IP included, or you cross-licensed everything to get access to the patents to make your own chips.  There was no other monetary royalty asked for or allowed.


     


    ETSI has no other FRAND term requirements or limits than the above.


     


    The royalty rates are traditionally set on the price of the phone because 1) it encouraged companies to make more affordable phones so that there's more adoption... which worked!, and 2) it's fairer to companies making extremely low profits (a handful of dollars) from making extremely affordable phones for the third world.


     


    Apple came to the cellular party late in the game, taking advantage of many other companies shouldering the early and expensive buildup of customers and infrastructure and chips. They also make far and away the highest profit margins.  


     


    Luckily for them, FRAND means they get access to the same deals as everyone else,anyway.  That means either paying high rates or swapping IP to get lower rates... just like everyone else.


     


    Since Apple doesn't want to swap IP, they're understandably trying to change the rules to make the rates lower without doing what everyone else did.  In other words, they're asking for discriminatory rates unlike any others.

  • Reply 34 of 37
    desuserigndesuserign Posts: 1,316member


    Who are you responding to?


    I'll assume it's me, even though you could be talking to yourself.


     


    If you read the standards and, more importantly, the court decisions interpreting them, you would find that "forcing" cross licensing or patent bundling upon unwilling parties has been found to be incompatible with the intent of FRAND terms. Additionally for the charged royalty to be "Fair and Reasonable" it must be consistent with and proportional to a "Reasonable and Non Discriminatory" aggregate royalty rate for all essential patents included in the standard. Without such an interpretation patent stacking and "hold up" are inevitable. These are two the main SEP abuses FRAND terms were originally designed to prevent.


    In light of this it is easy to see that if Samsung charges 2.25% for their small portion of the standard, the aggregate rate of royalties for all essential patents would be wildly unreasonable, discriminatory, and anticompetitive.


     


    Quote:

    Originally Posted by KDarling View Post


    If you read the relevant ETSI IP standard for FRAND terms, they specifically allow for cross-licensing. 


     


    In fact, that used to be the only way that Motorola (who originally had over 50% of GSM patents) allowed the use of their IP.  Either you bought their chips with the IP included, or you cross-licensed everything to get access to the patents to make your own chips.  There was no other monetary royalty asked for or allowed.


     


    ETSI has no other FRAND term requirements or limits than the above.


     


    The royalty rates are traditionally set on the price of the phone because 1) it encouraged companies to make more affordable phones so that there's more adoption... which worked!, and 2) it's fairer to companies making extremely low profits (a handful of dollars) from making extremely affordable phones for the third world.


     


    Apple came to the cellular party late in the game, taking advantage of many other companies shouldering the early and expensive buildup of customers and infrastructure and chips. They also make far and away the highest profit margins.  


     


    Luckily for them, FRAND means they get access to the same deals as everyone else,anyway.  That means either paying high rates or swapping IP to get lower rates... just like everyone else.


     


    Since Apple doesn't want to swap IP, they're understandably trying to change the rules to make the rates lower without doing what everyone else did.  In other words, they're asking for discriminatory rates unlike any others.


  • Reply 35 of 37
    desuserigndesuserign Posts: 1,316member


    Finally saw the "white" iP5 today. The exposed aluminum is not really what I would cal "white." It looks like a simple "plain" anodizing process.


    Conclusion: anodized and coated. No dye or paint.

  • Reply 36 of 37
    kdarlingkdarling Posts: 1,640member

    Quote:

    Originally Posted by DESuserIGN View Post


    If you read the standards and, more importantly, the court decisions interpreting them, you would find that "forcing" cross licensing or patent bundling upon unwilling parties has been found to be incompatible with the intent of FRAND terms.



     


    Sure.  However, Samsung doesn't require cross-licensing (they have a cash rate), and they don't require buying any other patents ("patent bundling").


     


    Quote:


    Additionally for the charged royalty to be "Fair and Reasonable" it must be consistent with and proportional to a "Reasonable and Non Discriminatory" aggregate royalty rate for all essential patents included in the standard.




     


    Most everyone agrees that the starting (no negotiations) aggregate rate for ETSI FRAND patents is high.  Over 30% total. Heck, Qualcomm alone still gets 3.25% or more for their patents unless you buy their chips.  That's why everyone cross-licenses; to get lower rates.


     


    Naturally, that clashes with Apple's desire to wring out as much profit margin as possible, and without sharing any IP.


     


    Still, since the current ETSI FRAND rate structures have been used for well over a decade by numerous parties, it's difficult to claim that they've been too "unreasonable".   Especially now, when they're the lowest they've ever been. 


     


    This is not to say that they couldn't be even more reasonable, but that's true of everything in life.  For example, it would be a lot more "reasonable" if Apple did not charge $200 more for phones that have just $30 more Flash memory... but they're in business to make money, just as the FRAND patent holders are.  

  • Reply 37 of 37


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