Motorola May Flex Its Patent Muscle - InformationWeek

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Commentary
8/11/2011
03:14 PM
Eric Zeman
Eric Zeman
Commentary
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Motorola May Flex Its Patent Muscle

Motorola Mobility CEO Sanjay Jha recently hinted that the company would consider using its formidable patent portfolio to collect royalties.

The smartphone industry is afire with patent litigation. Nearly every company is embroiled in multiple lawsuits with its competitors over alleged infringement of technology related to smartphones and/or tablets. Some companies have more patents than others. Motorola is one of those companies.

Motorola was created in 1928 by Paul V. and Joseph E. Galvin. The brothers bought the equipment of a bankrupt company and renamed it after themselves. Their main product was a battery eliminator, which let radios of the day run on alternating current in homes, rather than require direct current batteries. The Galvin Manufacturing Company grew throughout the '30s, and by the '40s was tinkering with two-way radios (i.e., walkie-talkies). The brothers Galvin renamed the company to Motorola in 1947. The company has been working in the wireless industry for nigh 70 years.

What I'm trying to say here is that Motorola has a huge number of patents to its name. When it comes to patent litigation, the larger the portfolio, the better.

One of the core problems facing Android or, more specifically, Google, is that Google does not have a strong patent portfolio. In fact, it hardly has any compared to its hardware partners. Android is currently under assault from Apple and Microsoft, if you believe Google's position.

Apple, RIM, Microsoft, and others recently squeezed Google out of a patent auction that could have given Google 6,000 patents, many of which pertained to mobile and wireless technologies. Google set the opening bid for the auction at $900 million. The final sale price was $4.5 billion--five times that of the stalking horse bid, and $1.1 billion more than Google's maximum bid of $3.14 billion. Who came up with that huge $4.5 billion? Not one company, but six, including those named above.

Fast-forward to Wednesday, and we have some very interesting comments coming from Motorola Mobility CEO Sanjay Jha, as reported by UnwiredView.com.

Speaking at the Oppenheimer & Technology Conference, Jha said, "I would bring up IP as a very important for differentiation [among Android vendors]. We have a very large IP portfolio, and I think in the long term, as things settle down, you will see a meaningful difference in positions of many different Android players. Both, in terms of avoidance of royalties, as well as potentially being able to collect royalties. And that will make a big difference to people who have very strong IP positions."

What Jha's trying to say here is that Motorola is beginning to think it should make some money off its patent portfolio, and it isn't above litigation to make sure that happens. The big question is, will Motorola shield Google, or go after it? It seems hard to believe the latter, as most of Motorola's recent successes can be attributed to the use of Google's Android platform. Stranger things have happened, though.

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