Why would tech companies bother making a technology a Standard then ?
They might aswell keep it as an Intellectual Property instead. That way they can enforce bans right ? Would this veto result in tech never becoming SEP's ???
SEPs are decided by a standards organization, not a company. Samsung/Apple/Nokia/whoever don't simply say, "this is now SEP/part of the standard".
The standards organization look at patents put forth by companies that want to make it it an SEP.
If the group decides the patent should be part of the standard, then the company has to agree to license it with FRAND/RAND. If they don't want to agree to the licensing, it ain't part of the standard.
-> http://www.techpolicy.com/Blog/February-2013/FRAND,-RAND,-and-SEP-Why-These-Acronyms-Are-Import.aspx
SEPs are decided by a standards organization, not a company. Samsung/Apple/Nokia/whoever don't simply say, "this is now SEP/part of the standard".
Actually, usually they do simply register a patent with the SSO as essential, with little or no review.
These things are taken on good faith, and only challenged if a lawsuit arises.
In fact, the evidence in the ITC case, submitted by various patent holders, noted that nobody could ever remember an engineer at a technical meeting actually saying, "Okay, this one will be essential." Frankly, it was too much bother. Such things were done later on.
Moreover, as the study below showed, most companies tend to throw extra patents in, not for royalties (because royalties are based on the quality of the most important contributions - not quantity), but because they otherwise might not get to use them in any future legal disputes. (Apple keeps trying to use such timing against Samsung, so the concern is valid.)
If the group decides the patent should be part of the standard, then the company has to agree to license it with FRAND/RAND. If they don't want to agree to the licensing, it ain't part of the standard.
The only peer review seems to be when a company asks too much for a license. So they usually don't. It's kind of self-regulating that way.
What confuses Apple (and everyone else) is that ETSI has long been more of a "gentleman's agreement" kind of SSO. The ETSI FRAND requirement has nothing in it about prices, for example. The only unique stipulation in there at all, in fact, is that a SEP holder can require cross-licensing.
What confuses Apple (and everyone else) is that ETSI has long been more of a "gentleman's agreement" kind of SSO. The ETSI FRAND requirement has nothing in it about prices, for example. The only unique stipulation in there at all, in fact, is that a SEP holder can require cross-licensing.
I'm pretty sure Apple isn't confused. SEP holders should not demand cross licensing for non SEP. that demand is not FRAND. While it doesn't have any pricing structure, it's pretty obvious you can't charge one vender $1 while you charge another $20.
South Korean gov / media is already reacting to this. The media is calling this act as protectionism. Damn I hope a new Cold War doesn't start up. Or has it already begun ?
Cold War? We're the only thing that keeps South Korea existing. All we have to do is pull out troops out and say, "Have at it, Kimmy!"
I'm pretty sure Apple isn't confused. SEP holders should not demand cross licensing for non SEP. that demand is not FRAND. While it doesn't have any pricing structure, it's pretty obvious you can't charge one vender $1 while you charge another $20.
Cross-licensing has been such a common ETSI practice for decades, that apparently few if any major SEP holders actually ever had a cash price available. Reference: that IPR paper above, and the ITC evidence documents.
Heck, back at the beginning of cellular, Motorola (the primary inventor) used to only have two deals available: either you bought your chips/radios from them with the IP included, or you cross-licensed every patent you had. There was no in-between.
Nevertheless, despite what we read from the lazy internet echo chamber, the evidence is that Samsung didn't "demand cross licensing". That was simply the base of their lower offers. (Their first offer was the cash price, which everybody in the industry expected Apple to negotiate down.) As the ITC ruling noted:
Sorry kdarling, but Apple isn't going to license iPhone patents. That's like Google licensing its search algorithm so it can use h264 patents. That is unreasonable.
Sorry kdarling, but Apple isn't going to license iPhone patents. That's like Google licensing its search algorithm so it can use h264 patents. That is unreasonable.
They probably wouldn't with Samsung...
But they have before. Surprised you don't remember. Some of those patents "that made the iPhone unique" were included when they settled with Nokia a couple years back. Nokia is one of those that insists on cross-licensing as a condition for a license to their SEP's.
Sorry kdarling, but Apple isn't going to license iPhone patents. That's like Google licensing its search algorithm so it can use h264 patents. That is unreasonable.
On the contrary, not only did Apple cross-license some of their patents to Nokia...
Apple also offered to license their patents to Samsung for a (rather large) fee before all the big trials began.
Moreover, last year HTC and Apple entered into a ten year agreement cross-licensing "all current and future patents" (minus a few HTC utility, and all Apple design patents).
-
The HTC contract is especially interesting, as it lets us know some of Apple's terms, which basically are: HTC can use any Apple utility patent as long as they don't "clone" a feature. Apple defined a "clone" as something that both looks and acts exactly the same as a feature on an Apple product.
An example they give is the slide-to-unlock. HTC cannot use the same graphic as Apple, but they could replace the graphic and be okay using the same slider mechanism.
"Don't pay FRAND patents, it's fine. The amount of R&D that went into creating the patent is irrelevant. Just continue using other people IP without compensating the inventor"
That's what this forum would sound like if Apple actually created any technology that would be worth FRAND status.
That's not what he said or what anyone hear has. No one is saying don't pay at all. But Samsung was caught asking for terms that were not within FRAND because they were trying to hold fair terms hostage unless they got a license on Apple IP that is not FRAND. IP that Apple has every legal right to not license. Which is not only uncool it is illegal. THAT is why Apple refused to pay. But because the IP is SEP they had to use it or have no phones cause you can't create a phone without that tech unless you want to spend years and millions of dollars trying to come up with something else. The avoidance of which is the point of standards etc.
Samsung agreed to the inclusion of said tech in the standard and to following FRAND so they were fully aware that what they were doing was illegal. They don't deserve getting to cry foul over Apple not agreeing to the terms Samsung demanded including getting to ban the products.
That is what the Pres agreed to, as well as the overall view that banning sales on items involved in SEP issues is just fundamentally wrong (which is why every other company is applauding the ban and Samsung would be also if it was their products in jeopardy)/
Oh and Apple has created a lot of stuff that has been enjoined into standards and is FRAND. It's not cell connection tech but it is out there (mostly audio and video codec work)
That is what the Pres agreed to, as well as the overall view that banning sales on items involved in SEP issues is just fundamentally wrong (which is why every other company is applauding the ban and Samsung would be also if it was their products in jeopardy)/
Oh and Apple has created a lot of stuff that has been enjoined into standards and is FRAND. It's not cell connection tech but it is out there (mostly audio and video codec work)
Apple apparently does have a growing portfolio of FRAND patents related to UMTS. In its letters to Samsung (intended to be seen by courts) it offers to cross license these wireless patents at low FRAND rates if Samsung agrees to do the same, with both sides getting royalties in proportion to their SEP/FRAND patent holdings.
As you note, Apple also has FRAND patents related to video/H.264 and web. Apple's Canvas patents related to 2D drawing in HTML5 were donated to the world for free in order to foster its adoption. And of course, Apple also contributed the work it did to develop Webkit as a standards-compliant web browser.
However, Samsung failed to offer fair terms and tried to charge Apple multiple times the amount others pay for this patent and therefore Apple refused to license it.
That is slightly incorrect. Samsung appears to have been totally willing to give Apple the same terms as everyone else. But only if Apple licensed several non SEP items to Samsung. And worse, it appears, if Apple refused to license said items, Samsung didn't want to give them any terms on the SEP. They just walked away from the table.
That's where they are getting into trouble. Apple legitimately doesn't have a signed agreement to use the tech regardless of Samsung saying 'we offered they won't take the terms' thus the ban. The ban was overturned because of the issue of the added stipulation and how it forced a refusal on Apple's part and whether it was fair etc.
From what I see, as long as the courts refuse to define 'Fair and Reasonable' its a big lawyer fest.
You forgot 'non discriminatory'.
The term is actually defined although actual dollar amounts aren't written down.
It has to be an amount that reflects the weight of the patent to the standard and is (more or less) equal for all parties. Also the holders can't refuse to license the tech to anyone that asks for a license.
A number of objections have come up over the years particularly with the whole 'reasonable' issue including tying the license price to a percent and in particular a percent of the final sale price of the item. This might have been fine when you were taking about flip phones that just made calls but there's lots more in a smart phone and generally one patent is a tiny part of the picture. So tying that license to a percent of a several hundred dollar item, particularly with other items sell for a lot less, means someone is paying way more. Not so fair or non discriminatory
The irony here is that Amazon DID in fact have a near-monopoly on ebooks, and their pricing was often "below cost" on books… so that "spike" you refer to is actually the price of books "normalizing", returning to where they should be, rather than riding at the "artifically lowered" prices set EXCLUSIVELY by Amazon.
Yep they did. Questionably obtained perhaps through illegal practices like predatory pricing, something that was never examined. Nor were questions of their possibly illegal actions like pulling paper books from selling until they get the ebook terms they wanted. No one ever bothered to look at those issues when Amazon was King of the Jungle and they should have. It only became an issue when Apple was the company 'at fault'.
Books are not a life essential items like bread or eggs or even petrol, the notion that there is a firm 'fair' price is rather bunk. The market really should be the decider on such non essential items. If folks are willing to pay they are willing to pay. If not, they don't and the eventually the price comes down. That is how it should be.
Essentially what the DOJ claims is that Apple wanted the price to go up simply to make more money. That Eddie etc knew that if they sold at the pricing Amazon was putting out there, and they would have to sell at those prices to make any sales, they wouldn't make any money. Apple, the claim is, knew that the publishers were mad because those cheap ebooks were hurting physical book sales which meant the publishers weren't making any money and devised this whole agency model etc for the soul purpose of raising prices to make said money. That Apple thought it up, sought at the publishers, gave them the very firm idea that they had to demand that all other stores follow "Apple" rules and so on. That the publishers had no choice when in fact they could have waited out their contracts, cut them and simply moved to selling ebooks on their own sites at whatever price they wanted.
To make matters worse, the DOJ disregarded that Apple actually put limits on the publishers control of how high they could go to protect consumers from the kind of overpricing that the Studios and Networks have on videos in iTunes, barred windowing done to protect paper copy sales etc. All in the consumer interest. And further, the DOJ may have had a biased judge on the case who backed up a ruling with evidence presented without context and thus interpreted in a very slanted manner. And even wholesale disregarded other evidence that didn't back up her pre trial ruling. All of which is worthy of a full court review much like this issue of what Samsung is calling fair terms etc. I'm fully in support of the President saying no to bans on items involved in SEP disputes as well as in support of someone saying no to the DOJ's plan to basically kill the iTunes Stores and eliminating a consumer choice. Fine Apple for facilitating publisher collusion without the question of whose idea it was, that's fair. Limit how high publishers can price stuff, no concern there. Adjust the rules of how a MFN deal cause work to allow for limited sales exclusive to a shop, okay. But to kill a whole service in the name of protecting competition just lacks logic. Same as limiting a line of products over a patent that is legally supposed to be licensed etc. Let the court see all deals over that patent, decide what is fair etc and both sides have to agree to it and appropriate payments made by a set time or a ban is valid.
Where is KDarling? Didn't he quote the ITC decision in other threads to show that Apple is actually in the wrong here?
The ITC decided that Apple was in the wrong, much as the DOJ did over the ebooks issue. But those interpretations don't actually mean that Apple was in the wrong in either case. Another authority reviewing the same materials could interpret them another way
Apple's contention was that Samsung wasn't being fair because they tied a non SEP to the price offered and refused to pay. The ITC said they have to pay because the dollar amount being asked for was the same as everyone else was paying and the tying was beside the point. Apple didn't agree and further didn't want to license the tech in question regardless of how much Samsung was offering for it and as it was non SEP couldn't be forced into the agreement so they didn't pay. They don't agree with the ITC that the tying isn't an issue and it's rather clear that they are sticking to their feelings to force this to a higher authority. Just like they will with this ebook thing (if only to get the other stores taken out of the issue since there was no finding of wrongdoing regarding those stores so they should have never been brought into the 'punishment')
All they wanted was to have an equal playing field between all resellers of ebooks
Which is what the Most Favored Nation clauses are about (and why they are standard practice in the book industry)
and have a standard LIST Price and 30% margin and then each reseller can then resell the books at whatever price they want to.
That is actually incorrect. Agency terms are that the publisher sets the price. Resellers can't change it without the publisher agreeing to the change. Outside of if there is clear evidence that the publisher gave a different price to another reseller and then Reseller A has the right to lower their price to that amount until the other parties price goes back up (ie to make a promo/sale)
Under agency the reseller retains a preset cut of the price that the publisher set as a fee rather than a wholesale dollar amount. But outside of invoking the MFN, the reseller has zero pricing control.
Comments
The standards organization look at patents put forth by companies that want to make it it an SEP.
If the group decides the patent should be part of the standard, then the company has to agree to license it with FRAND/RAND. If they don't want to agree to the licensing, it ain't part of the standard.
-> http://www.techpolicy.com/Blog/February-2013/FRAND,-RAND,-and-SEP-Why-These-Acronyms-Are-Import.aspx
Quote:
Originally Posted by Chris_CA
SEPs are decided by a standards organization, not a company. Samsung/Apple/Nokia/whoever don't simply say, "this is now SEP/part of the standard".
Actually, usually they do simply register a patent with the SSO as essential, with little or no review.
These things are taken on good faith, and only challenged if a lawsuit arises.
In fact, the evidence in the ITC case, submitted by various patent holders, noted that nobody could ever remember an engineer at a technical meeting actually saying, "Okay, this one will be essential." Frankly, it was too much bother. Such things were done later on.
Moreover, as the study below showed, most companies tend to throw extra patents in, not for royalties (because royalties are based on the quality of the most important contributions - not quantity), but because they otherwise might not get to use them in any future legal disputes. (Apple keeps trying to use such timing against Samsung, so the concern is valid.)
Study on the Interplay between Standards and Intellectual Property Rights (IPRs) - 2009, (200 page PDF)
Quote:
If the group decides the patent should be part of the standard, then the company has to agree to license it with FRAND/RAND. If they don't want to agree to the licensing, it ain't part of the standard.
The only peer review seems to be when a company asks too much for a license. So they usually don't. It's kind of self-regulating that way.
What confuses Apple (and everyone else) is that ETSI has long been more of a "gentleman's agreement" kind of SSO. The ETSI FRAND requirement has nothing in it about prices, for example. The only unique stipulation in there at all, in fact, is that a SEP holder can require cross-licensing.
I'm pretty sure Apple isn't confused. SEP holders should not demand cross licensing for non SEP. that demand is not FRAND. While it doesn't have any pricing structure, it's pretty obvious you can't charge one vender $1 while you charge another $20.
If you have proof of that, please PM Marvin so that he can verify your statement with the back-end data here.
Cold War? We're the only thing that keeps South Korea existing. All we have to do is pull out troops out and say, "Have at it, Kimmy!"
Quote:
Originally Posted by jungmark
I'm pretty sure Apple isn't confused. SEP holders should not demand cross licensing for non SEP. that demand is not FRAND. While it doesn't have any pricing structure, it's pretty obvious you can't charge one vender $1 while you charge another $20.
Cross-licensing has been such a common ETSI practice for decades, that apparently few if any major SEP holders actually ever had a cash price available. Reference: that IPR paper above, and the ITC evidence documents.
Heck, back at the beginning of cellular, Motorola (the primary inventor) used to only have two deals available: either you bought your chips/radios from them with the IP included, or you cross-licensed every patent you had. There was no in-between.
Nevertheless, despite what we read from the lazy internet echo chamber, the evidence is that Samsung didn't "demand cross licensing". That was simply the base of their lower offers. (Their first offer was the cash price, which everybody in the industry expected Apple to negotiate down.) As the ITC ruling noted:
They probably wouldn't with Samsung...
But they have before. Surprised you don't remember. Some of those patents "that made the iPhone unique" were included when they settled with Nokia a couple years back. Nokia is one of those that insists on cross-licensing as a condition for a license to their SEP's.
Quote:
Originally Posted by jungmark
Sorry kdarling, but Apple isn't going to license iPhone patents. That's like Google licensing its search algorithm so it can use h264 patents. That is unreasonable.
On the contrary, not only did Apple cross-license some of their patents to Nokia...
Apple also offered to license their patents to Samsung for a (rather large) fee before all the big trials began.
Moreover, last year HTC and Apple entered into a ten year agreement cross-licensing "all current and future patents" (minus a few HTC utility, and all Apple design patents).
-
The HTC contract is especially interesting, as it lets us know some of Apple's terms, which basically are: HTC can use any Apple utility patent as long as they don't "clone" a feature. Apple defined a "clone" as something that both looks and acts exactly the same as a feature on an Apple product.
An example they give is the slide-to-unlock. HTC cannot use the same graphic as Apple, but they could replace the graphic and be okay using the same slider mechanism.
That's what I meant.
[email protected]
Quote:
Originally Posted by mrrodriguez
The President sent a clear message
"Don't pay FRAND patents, it's fine. The amount of R&D that went into creating the patent is irrelevant. Just continue using other people IP without compensating the inventor"
That's what this forum would sound like if Apple actually created any technology that would be worth FRAND status.
That's not what he said or what anyone hear has. No one is saying don't pay at all. But Samsung was caught asking for terms that were not within FRAND because they were trying to hold fair terms hostage unless they got a license on Apple IP that is not FRAND. IP that Apple has every legal right to not license. Which is not only uncool it is illegal. THAT is why Apple refused to pay. But because the IP is SEP they had to use it or have no phones cause you can't create a phone without that tech unless you want to spend years and millions of dollars trying to come up with something else. The avoidance of which is the point of standards etc.
Samsung agreed to the inclusion of said tech in the standard and to following FRAND so they were fully aware that what they were doing was illegal. They don't deserve getting to cry foul over Apple not agreeing to the terms Samsung demanded including getting to ban the products.
That is what the Pres agreed to, as well as the overall view that banning sales on items involved in SEP issues is just fundamentally wrong (which is why every other company is applauding the ban and Samsung would be also if it was their products in jeopardy)/
Oh and Apple has created a lot of stuff that has been enjoined into standards and is FRAND. It's not cell connection tech but it is out there (mostly audio and video codec work)
Quote:
Originally Posted by charlituna
That is what the Pres agreed to, as well as the overall view that banning sales on items involved in SEP issues is just fundamentally wrong (which is why every other company is applauding the ban and Samsung would be also if it was their products in jeopardy)/
Oh and Apple has created a lot of stuff that has been enjoined into standards and is FRAND. It's not cell connection tech but it is out there (mostly audio and video codec work)
Apple apparently does have a growing portfolio of FRAND patents related to UMTS. In its letters to Samsung (intended to be seen by courts) it offers to cross license these wireless patents at low FRAND rates if Samsung agrees to do the same, with both sides getting royalties in proportion to their SEP/FRAND patent holdings.
As you note, Apple also has FRAND patents related to video/H.264 and web. Apple's Canvas patents related to 2D drawing in HTML5 were donated to the world for free in order to foster its adoption. And of course, Apple also contributed the work it did to develop Webkit as a standards-compliant web browser.
Quote:
Originally Posted by cynic
However, Samsung failed to offer fair terms and tried to charge Apple multiple times the amount others pay for this patent and therefore Apple refused to license it.
That is slightly incorrect. Samsung appears to have been totally willing to give Apple the same terms as everyone else. But only if Apple licensed several non SEP items to Samsung. And worse, it appears, if Apple refused to license said items, Samsung didn't want to give them any terms on the SEP. They just walked away from the table.
That's where they are getting into trouble. Apple legitimately doesn't have a signed agreement to use the tech regardless of Samsung saying 'we offered they won't take the terms' thus the ban. The ban was overturned because of the issue of the added stipulation and how it forced a refusal on Apple's part and whether it was fair etc.
Quote:
Originally Posted by Frood
From what I see, as long as the courts refuse to define 'Fair and Reasonable' its a big lawyer fest.
You forgot 'non discriminatory'.
The term is actually defined although actual dollar amounts aren't written down.
It has to be an amount that reflects the weight of the patent to the standard and is (more or less) equal for all parties. Also the holders can't refuse to license the tech to anyone that asks for a license.
A number of objections have come up over the years particularly with the whole 'reasonable' issue including tying the license price to a percent and in particular a percent of the final sale price of the item. This might have been fine when you were taking about flip phones that just made calls but there's lots more in a smart phone and generally one patent is a tiny part of the picture. So tying that license to a percent of a several hundred dollar item, particularly with other items sell for a lot less, means someone is paying way more. Not so fair or non discriminatory
Quote:
Originally Posted by tribalogical
The irony here is that Amazon DID in fact have a near-monopoly on ebooks, and their pricing was often "below cost" on books… so that "spike" you refer to is actually the price of books "normalizing", returning to where they should be, rather than riding at the "artifically lowered" prices set EXCLUSIVELY by Amazon.
Yep they did. Questionably obtained perhaps through illegal practices like predatory pricing, something that was never examined. Nor were questions of their possibly illegal actions like pulling paper books from selling until they get the ebook terms they wanted. No one ever bothered to look at those issues when Amazon was King of the Jungle and they should have. It only became an issue when Apple was the company 'at fault'.
Books are not a life essential items like bread or eggs or even petrol, the notion that there is a firm 'fair' price is rather bunk. The market really should be the decider on such non essential items. If folks are willing to pay they are willing to pay. If not, they don't and the eventually the price comes down. That is how it should be.
Essentially what the DOJ claims is that Apple wanted the price to go up simply to make more money. That Eddie etc knew that if they sold at the pricing Amazon was putting out there, and they would have to sell at those prices to make any sales, they wouldn't make any money. Apple, the claim is, knew that the publishers were mad because those cheap ebooks were hurting physical book sales which meant the publishers weren't making any money and devised this whole agency model etc for the soul purpose of raising prices to make said money. That Apple thought it up, sought at the publishers, gave them the very firm idea that they had to demand that all other stores follow "Apple" rules and so on. That the publishers had no choice when in fact they could have waited out their contracts, cut them and simply moved to selling ebooks on their own sites at whatever price they wanted.
To make matters worse, the DOJ disregarded that Apple actually put limits on the publishers control of how high they could go to protect consumers from the kind of overpricing that the Studios and Networks have on videos in iTunes, barred windowing done to protect paper copy sales etc. All in the consumer interest. And further, the DOJ may have had a biased judge on the case who backed up a ruling with evidence presented without context and thus interpreted in a very slanted manner. And even wholesale disregarded other evidence that didn't back up her pre trial ruling. All of which is worthy of a full court review much like this issue of what Samsung is calling fair terms etc. I'm fully in support of the President saying no to bans on items involved in SEP disputes as well as in support of someone saying no to the DOJ's plan to basically kill the iTunes Stores and eliminating a consumer choice. Fine Apple for facilitating publisher collusion without the question of whose idea it was, that's fair. Limit how high publishers can price stuff, no concern there. Adjust the rules of how a MFN deal cause work to allow for limited sales exclusive to a shop, okay. But to kill a whole service in the name of protecting competition just lacks logic. Same as limiting a line of products over a patent that is legally supposed to be licensed etc. Let the court see all deals over that patent, decide what is fair etc and both sides have to agree to it and appropriate payments made by a set time or a ban is valid.
Quote:
Originally Posted by matrix07
Where is KDarling? Didn't he quote the ITC decision in other threads to show that Apple is actually in the wrong here?
The ITC decided that Apple was in the wrong, much as the DOJ did over the ebooks issue. But those interpretations don't actually mean that Apple was in the wrong in either case. Another authority reviewing the same materials could interpret them another way
Apple's contention was that Samsung wasn't being fair because they tied a non SEP to the price offered and refused to pay. The ITC said they have to pay because the dollar amount being asked for was the same as everyone else was paying and the tying was beside the point. Apple didn't agree and further didn't want to license the tech in question regardless of how much Samsung was offering for it and as it was non SEP couldn't be forced into the agreement so they didn't pay. They don't agree with the ITC that the tying isn't an issue and it's rather clear that they are sticking to their feelings to force this to a higher authority. Just like they will with this ebook thing (if only to get the other stores taken out of the issue since there was no finding of wrongdoing regarding those stores so they should have never been brought into the 'punishment')
Quote:
Originally Posted by drblank
All they wanted was to have an equal playing field between all resellers of ebooks
Which is what the Most Favored Nation clauses are about (and why they are standard practice in the book industry)
and have a standard LIST Price and 30% margin and then each reseller can then resell the books at whatever price they want to.
That is actually incorrect. Agency terms are that the publisher sets the price. Resellers can't change it without the publisher agreeing to the change. Outside of if there is clear evidence that the publisher gave a different price to another reseller and then Reseller A has the right to lower their price to that amount until the other parties price goes back up (ie to make a promo/sale)
Under agency the reseller retains a preset cut of the price that the publisher set as a fee rather than a wholesale dollar amount. But outside of invoking the MFN, the reseller has zero pricing control.