January 12, 2012, 10:56 AM — With all the hootin' and hollerin' going on at CES about the new Android, Windows Phone 7, and other gadget-y offerings, this piece of news may be a bit under the radar: Microsoft has just announced a new patent agreement with LG, and is now bragging that they are collecting royalty payments from over 70 percent of U.S. Android OEMs.
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In the press release today, "Microsoft Corp. and LG Electronics have signed a patent agreement that provides broad coverage under Microsoft's patent portfolio for LG's tablets, mobile phones and other consumer devices running the Android or Chrome OS Platform. The contents of the agreement have not been disclosed."
Contents, I am sure, like how much money has been exchanged, and what exact patents are being infringed. It's a reasonable assumption that not even LG is clear on that last bit of information.
Curiously, there's no corresponding article on Microsoft's legal blog, like there was when Microsoft signed a similar deal with Samsung back in September. And the spin has been altered: in September, the bragging rights were over the fact that Motorola Mobility (MMT) was the last major U.S. smartphone vendor left to sign a cross-licensing patent deal with Redmond. Now, it's that percentage of vendors paying Microsoft to use Android that's the big talking point:
"'We are pleased to have built upon our longstanding relationship with LG to reach a mutually beneficial agreement. Together with our ten previous agreements with Android and Chrome OS device manufacturers, including HTC, Samsung and Acer, this agreement with LG means that more than seventy percent of all Android smartphones sold in the U.S. are now receiving coverage under Microsoft's patent portfolio,' said Horacio Gutierrez, corporate vice president and deputy general counsel, Intellectual Property Group at Microsoft."
The press release notes that this is not a brand-new agreement: it is an expansion of a 2007 patent license agreement. At the time, the deal centered around Linux specifically, since Android and ChromeOS were just a gleam in Google's eye back then:
"Through the agreement, LGE will be able to use Microsoft®-patented innovations in its products, including Linux-based embedded devices. Microsoft will have access to LGE’s patents and will license other patents developed by LGE that are now owned by business solutions provider MicroConnect Group."
By expanding this to cover Android and ChromeOS, it gives Microsoft the talking point they need to bludgeon other vendors into signing up for their patent licensing program.
Since LG was already in the Microsoft patent club, it's hardly a surprise. Today's announcement, I am sure, is a calculated move to dampen the aforementioned hootin' and hollerin' about Android, and help boost Windows Phone device press coming out of CES.
I would have to think, though, that the gravy train for Microsoft is about to run out, as far as getting new partners their licensing program. As Microsoft itself has pointed out, MMT is the last hold-out. But considering Google is working to buy MMT, there's very little chance those folks will sign anything from Microsoft.
And then there's the ongoing Barnes & Noble lawsuit from Microsoft, where Barnes & Noble is accused of patent infringement within the Android-based Nook eReader. Barnes & Noble, which to the glee of tech reporters never signed a non-disclosure agreement with Microsoft, has been free to say whatever it wants in that lawsuit, and they have made a point to do exactly that as the legal proceedings in that lawsuit continue.
Barnes & Noble's affirmative defense stipulates that Microsoft is misusing its patent licensing program to deliberately forestall its Android competitors. The book retailer has also fired off dozens of pages of prior art examples that seem to blow away the patents Microsoft is using in the lawsuit.
Today's news, while notable, does not change the status quo for Microsoft and Android: Microsoft wants a piece of the exploding mobile space, and it will do anything it can to get it.
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