Google thinks it’s come up with a solution to the patents problem. The company is advocating broadening the Standards Essential Patent (SEP) product category of patents, which include technologies that are industry standards, to include popular features that consumers know and love.
The crux of the matter is technologies that have become extremely popular with consumers. Google feels these should be considered “de facto standards” and treated like standards essential patents.
The difference is between technologies that have become industry standards and technology that have became popular with consumers. It’s basically the difference between technologies that make a mobile phone possible, and the technologies that go in to an iPhone.
Google has sent a letter to the US Senate Judiciary Committee claiming that “Widely accepted, open standards have allowed for the rapid development and adoption of new technology” and suggesting that de facto standards should be treated in the same way.
Google states: “When one firm publishes information about an otherwise proprietary standard and other firms then independently decide (whether by choice or of necessity) to make complementary investments to support that standard in their products… the Committee’s concern regarding the abuse of SEPs should encompass them as well.”
Google’s argument is that commercially essential patents should be considered in the same light as standards essential patents. Apple has many patents that might be considered “commercially essential”, notes AllthingsD.
To illustrate its point that not standardising some technologies can cause an industry to stagnate, Google gives the example of one area where not adopting a standard caused slowdown. The letter refers to the European adoption of the GSM standard that lead to the rapid growth of the digital mobile phone. While in the US there was no unified standard in the same period and as a result “digital mobile phones began to be used only in 1995” and was still less than 30% in 1998.
“Maintaining appropriate incentives for both implementers and innovators to participate in the standardization process is of critical importance,” notes the letter.
Needless to say, Apple doesn’t agree. Apple General Counsel Bruce Sewell said in a letter to the Senate Judiciary Committee: “That a proprietary technology becomes quite popular does not transform it into a ‘standard’ subject to the same legal constraints as true standards.”
Apple highlights two types of technology: Standardizes and Product-differentiating. It is these product-differentiating technologies that make the iPhone the iPhone. Sewell writes: “Apple spent billions in research and development to create the iPhone, and third party software developers have spent billions more to develop applications that run on it. The price of an iPhone reflects the value of these nonstandardized technologies.”
He adds: “The aesthetic design of the iPhone, which also reflects immense study and development by Apple, and which is entirely unrelated to standards.”
It boils down to the difference between a mobile phone and an iPhone. Apple says: “The capabilities of an iPhone are categorically different from a conventional phone.”
Apple also expresses concern that if you remove the IP distinctions between a standard mobile phone, and the iPhone, you remove a key incentive for innovators to innovate.
Apple takes no issue with having to licence SEPs. Apple CEO Tim Cook made this clear when speaking at D10, saying: “No one should be able to get an injunction off a standards-essential patent because the owner of the patent has the responsibility to license it on a fair, reasonable and non-discriminatory manner.”
Apple states that standards essential patents are subject to licence on fair, reasonable, and non-discriminatory ‘FRAND’ terms.
Apple claims that Motorola Mobility, now a subsidiary of Google, ripped off the iPhone as a whole. Apple is also at loggerheads with Google over Android, which it also claims borrow heavily from iOS. Apple CEO Steve Jobs famously said he would go “thermonuclear” over Android.
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