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Microsoft Makes an Astonishing $2 Billion Per Year From Android Patent Royalties

Soulskill posted about 6 months ago | from the isn't-innovation-wonderful dept.

Microsoft 304

mrspoonsi sends this report from Business Insider: "Microsoft is generating $2 billion per year in revenue from Android patent royalties, says Nomura analyst Rick Sherlund in a new note on the company. He estimates that the Android revenue has a 95% margin, so it's pretty much all profit. This money, says Sherlund, helps Microsoft hide the fact that its mobile and Xbox groups are burning serious cash."

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304 comments

Gates was on the right track.. (4, Insightful)

gandhi_2 (1108023) | about 6 months ago | (#45349725)

Hardware is cheap.
Software is expensive.
Charging for IDEAS, though... THAT is where the real money is.

SCO WON! (-1)

Anonymous Coward | about 6 months ago | (#45349819)

Don't forget your $699 licensing fee your cock-smoking android users!

Re:Gates was on the right track.. (5, Funny)

flargleblarg (685368) | about 6 months ago | (#45349859)

And this is why we can't have nice things.

Re:Gates was on the right track.. (0)

Anonymous Coward | about 6 months ago | (#45350059)

And this is why we can't have nice things.

We can't, but the extortionists in Microsoft probably live quite well.

Re:Gates was on the right track.. (2, Interesting)

Anonymous Coward | about 6 months ago | (#45349891)

says Sherlund, helps Microsoft hide the fact that its mobile and Xbox groups are burning serious cash

If you exclude Halo 2 and 3. Also if you dig into the financials of the xbox you will see a serious money sink. I got 3 prospectuses from them. I thought I had to be reading it wrong. No they were really spending that kind of money with a massive no ROI. I sold my stock.

Dont get me wrong. XBOX is wildly popular. But profitable? Not so much.

Having not see a recent prospectus I can just imagine the bleed on the phone division. Though that division did come up with many of those patents. And before everyone goes 'they are so obvious'. MS did something you didnt they made a patent out of it. The had been working on the smart phone since about 1998. They unfortunately came up with WinCE to show for it.

Re:Gates was on the right track.. (0)

perpenso (1613749) | about 6 months ago | (#45349957)

Sometimes products have a strategic motivation, not necessarily a direct revenue source motivation. Perhaps MS wants a foothold in the living room, wants to be the digital media device plugged into the TV, etc.

Maybe they are thinking beyond the short term?

Re:Gates was on the right track.. (1)

rwa2 (4391) | about 6 months ago | (#45350065)

Plus, physical consoles were pretty much always loss leaders... Sega, Sony, Nintendo would lose money on their hardware and make it up on selling titles - both their own and from third-party developers. Is Microsoft not including all of profits from licensing in their reports?

Re:Gates was on the right track.. (0)

Anonymous Coward | about 6 months ago | (#45350147)

Nintendo never followed the loss-leader concept with their consoles. All sales of their consoles have been profitable.

Re:Gates was on the right track.. (3, Informative)

sexconker (1179573) | about 6 months ago | (#45350185)

Plus, physical consoles were pretty much always loss leaders... Sega, Sony, Nintendo would lose money on their hardware and make it up on selling titles - both their own and from third-party developers. Is Microsoft not including all of profits from licensing in their reports?

That's including all licensing fees, Live subscriptions, etc. The XBOX division as a whole is billions of dollars in the red.

Re:Gates was on the right track.. (0)

Anonymous Coward | about 6 months ago | (#45350611)

That's including all licensing fees, Live subscriptions, etc. The XBOX division as a whole is billions of dollars in the red.

And outside of investors who really cares? Are you really going to complain that it's underpriced?

Re:Gates was on the right track.. (2)

PlusFiveTroll (754249) | about 6 months ago | (#45350685)

Services.

A whole shitload of the XBOX is based on on line servers or gold membership for usability If MS decided to shut it all down, your single player disc based games will still work, but all the rest is gone.

Re:Gates was on the right track.. (1)

ackthpt (218170) | about 6 months ago | (#45349975)

says Sherlund, helps Microsoft hide the fact that its mobile and Xbox groups are burning serious cash

If you exclude Halo 2 and 3. Also if you dig into the financials of the xbox you will see a serious money sink. I got 3 prospectuses from them. I thought I had to be reading it wrong. No they were really spending that kind of money with a massive no ROI. I sold my stock.

Dont get me wrong. XBOX is wildly popular. But profitable? Not so much.

Having not see a recent prospectus I can just imagine the bleed on the phone division. Though that division did come up with many of those patents. And before everyone goes 'they are so obvious'. MS did something you didnt they made a patent out of it. The had been working on the smart phone since about 1998. They unfortunately came up with WinCE to show for it.

Never mind that gamers tend to be very fickle. If a better game comes out on Sony or Nintendo, the XBox gathers dust. So Microsoft's efforts to use the XBox as a gateway into pwning your home, making you rely upon them for $ervice$ isn't panning like they wished. I still can't fathom why they continue to fool around in this non-core area. Why not just buy a movie studio or a bunch of golf courses?

Re:Gates was on the right track.. (2, Insightful)

alvinrod (889928) | about 6 months ago | (#45349895)

Hey, if you can't beat 'em, joi^H^H^H sue 'em.

Seriously though, the system needs to be changed. When the only way to play the game involves suing everyone else, there's obviously something wrong that needs fixing. Unfortunately, there're so many other things in this country that are screwed up, that it's hard to put patent reform before fixing health care, ending spying on citizens, stopping discrimination based on orientation, reducing our involvement in foreign conflicts, and a long list of other issues. Then again, perhaps the patent system isn't something that's become so heavily partisan that there's no way to pass legislation related to it.

Re:Gates was on the right track.. (0)

Anonymous Coward | about 6 months ago | (#45350373)

You mean charging for implementations of ideas, there's a difference.

Two billion bucks... (1)

gweilo8888 (921799) | about 6 months ago | (#45349727)

...for a bunch of "inventions" that are almost certainly blindingly obvious to anybody over the age of four, and under the age of 55. No, the patent system isn't broken at all, nuh uh. Why do you ask?

Re:Two billion bucks... (1)

i kan reed (749298) | about 6 months ago | (#45349749)

Your being unfair. They're blindingly obvious to 60% of the people involved in the right industry. Software/hardware illiterate people would have no idea what you're talking about.

Re:Two billion bucks... (5, Informative)

ledow (319597) | about 6 months ago | (#45349843)

However the test used in the patent systems worldwide tends to be along the lines:

"to one skilled in the art".

i.e. if it's blindingly obvious to someone who does similar work all day long, professionally, every day, then it shouldn't actually be patentable at all.

Re:Two billion bucks... (5, Insightful)

girlintraining (1395911) | about 6 months ago | (#45349917)

However the test used in the patent systems worldwide tends to be along the lines: "to one skilled in the art".

It's the same in America. The difference is, the art isn't engineering, it's lawyering.

Re:Two billion bucks... (2)

drakaan (688386) | about 6 months ago | (#45349951)

yep. But that's beside the point that software is math, and math isn't supposed to be patentable.

common misconception. basic laws not patentable (4, Interesting)

raymorris (2726007) | about 6 months ago | (#45350243)

> software is math

Games are art, and are software.
Most games are 95% art, 5% math, and 100% software.
Math CAN be done as software, but so can art and many other non-math things. Some software is math. A LOT of software has little to do with math.

> math isn't supposed to be patentable.

That's a common misconception, started and encouraged by people with a particular agenda. The rule in the US is:

    The LAWS of nature, including mathematics, are not patentable.

Note that it's the basic laws that aren't patentable. Things that USE those laws are.

Gravity isn't patentable. An elevator is.
Momentum isn't patentable. A brake system is.
Division isn't patentable. eBay's feedback system is.
Light reflection isn't patentable. The way Blender simulates reflection is, if it's novel.

Re:common misconception. basic laws not patentable (4, Insightful)

Mr0bvious (968303) | about 6 months ago | (#45350587)

Most games are 95% art, 5% math, and 100% software.

Huh? that's some crazy statistics?

How much does math weigh compared to art?

How do you measure how much math there is compared to art? Is it the byte size of the executable (minus any embedded art) vs the byte size of the art?

I'm just confused how one could have any measure of either against each other...

My house is 99.99% bricks and mortar and 0.01% design... (using some arbitrary measure I just thought of)

A LOT of software has little to do with math.

Sorry, but ALL software is an expression of math..

patent vs copyright (5, Interesting)

Chirs (87576) | about 6 months ago | (#45350259)

Technically it's only the implementation of an idea that is supposed to be patentable. With physical patents if you can accomplish the same thing by other means then it's fair game.

Somehow in software they've decided to allow patenting the *idea* of momentum when scrolling via swiping, or bounceback when you hit the end.

The equivalent to patenting physical implementations would be to allow protection of their *implementation* of an idea--and in the software world that implementation is already protected by copyright, so there's really no need for software patents.

Re:Two billion bucks... (1)

msobkow (48369) | about 6 months ago | (#45350291)

Only in the most technical sense that computers interpret numbers to operate.

Very little of the programming I've done over the years involved much mathematics. Even with big batch jobs that did bill processing, the math itself was only a very small part of the code compared to the SQL, cursor iteration, error handling, and reporting aspects of the programs.

There is also the question of whether something like queueing theory should really be considered "mathematics." Yes, it relies on statistics and curves, but it's functionality is decidedly non-mathematical in nature most of the time.

Very few people are involved in the "hard core" mathematics areas of computing like game engines or scientific graphing packages.

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350451)

Only in the most technical sense that computers interpret numbers to operate.

What do numbers have to do with mathematics?

Re:Two billion bucks... (1)

HockeyPuck (141947) | about 6 months ago | (#45350089)

Is it skilled in the art at the time of filing or at the time that the patent is granted by the USPO which can be many years later?

I have a few patents and one took 7yrs to get through the USPO...

Hindsight is 20/20...

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350935)

It doesn't matter ... the examiner has read your patent, he already has hindsight.

Yours is a very dangerous line of reasoning, which leads straight to the patent lawyer type of reasoning which simply redefines the word obvious so they can devise a test for it. Thankfully they keep running into non retarded judges which realize that fact and send their objective "obviousnesses" tests to the rubbish bin.

Obviousness is an inherently subjective property and we can only depend on the expert's judgement to mitigate hindsight.

Re:Two billion bucks... (2)

Alef (605149) | about 6 months ago | (#45350281)

I think "obvious to someone skilled in the art" is actually a lousy test. What's interesting is whether the invention will surface even without granting a state-sanctioned monopoly on it. If there is a million engineers worldwide working in a certain field, and an invention is non-obvious to 99% of them, there are still 10000 who could do something similar. To grant a single one of them a 20 year monopoly on it is hardly a win for society. It might have been different back in the olden days, when skilled engineers were actually rare.

Re:Two billion bucks... (1)

whoever57 (658626) | about 6 months ago | (#45350571)

It might have been different back in the olden days, when skilled engineers were actually rare.

There was a very interesting documentary series a few decades ago ("Connections" by James Burke) that looked at technology through the ages. One of the common themes was how technologies were invented and re-invented at different times and places. It's only modern communications that prevent re-invention, because the knowledge of the "original" invention travels around the world.

Re:Two billion bucks... (1)

InvalidError (771317) | about 6 months ago | (#45350851)

Many patents "obvious to one skilled in the art" these days are also painfully obvious to an average person with common sense.

Re:Two billion bucks... (1)

Anonymous Coward | about 6 months ago | (#45349885)

It's to access your SD cards formatted with FAT + long filenames. This is why Nexus devices forgo them and use that fucking awful MTP shit.

Re:Two billion bucks... (3, Insightful)

stewsters (1406737) | about 6 months ago | (#45350023)

They could just implement their own system, like Ext4 or something, the problem being that Fat and NTFS are like the only things Windows can read and write. You can get some programs that let you do it, but they are not as seamless as something like fuse is in Linux mounting windows partitions. It is a problem created by Microsoft, which apparently they have earned 2 billion for.

Re:Two billion bucks... (1)

cyber-vandal (148830) | about 6 months ago | (#45350575)

They have these things called drivers that add additional functionality to Windows. It would only take one popular device to install that driver and suddenly exFAT is dead in the water.

Re:Two billion bucks... (5, Interesting)

whoever57 (658626) | about 6 months ago | (#45350729)

I have never understood this. Windows users are used to installing drivers for each new piece of hardware. Why not bundle an ext4 driver? The device could even have a small FAT partiton (without the patented parts of FAT) that contains the driver for the larger ext4 partition.

Manufacturers have allowed the situation to exist.

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350161)

MTP is there because USB Mass Storage Device doesn't let the phone and the computer access the block device at the same time, so your SD card is dismounted from the phone when you plug it into the computer. (That plays great with apps stored on the SD card that are currently running, btw!)

But no, it's MTP that's awful and not MSD, right.

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350643)

USB Mass Storage Device doesn't let the phone and the computer access the block device at the same time

So wouldn't the solution be to make it so it does?

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350693)

It's the way the USB MSD standard works, not a thing Android can really fix.

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45349903)

Even more blindingly obvious when you have been using them for a couple of years, completely ignoring the fact that a few hers ago no one did it.

100% hindsight is a powerful tool for fools.

Re:Two billion bucks... (0)

Anonymous Coward | about 6 months ago | (#45350165)

I'm not sure who said it, and these might not be a completely accurate quote, but it went something like, "It's amazing how blindingly obvious, utterly simple and basic some things become - once you've been shown them by someone for the first time."

They finally made money out of Linux. (0)

Anonymous Coward | about 6 months ago | (#45349731)

Took em long enough.

Re:They finally made money out of Linux. (5, Insightful)

melikamp (631205) | about 6 months ago | (#45350403)

Funny.

But seriously, open your fucking eyes, people. Here we have a private enterprise that put a break on the development of a personal computer for 20 something years, and now it's taxing the development and adoption of an operating system that was written from scratch, using UNIX philosophy which Micro$oft neither invented nor indeed implemented.

Just like copyrights, patents are not worth crap to individual inventors because the chances of making a return on the investment with one, two, or even a hundred inventions are miniscule. So the inventors sign over their inventions to capitalists for either a small lump sum or a regular paycheck; and so do the artist with copyright, because it ultimately makes sense for them economically. The capitalists, on the other hand, are wielding tens of thousands of patents; just like the art producers are controlling significant proportions of the entire catalog. And when they control, say, 10% of all published ideas, they can finally make patents (and copyrights) pay. The art business is ugly, we all heard that, but the technology is uglier! With patents, in particular, the best way to maximize the return is by suing everyone who dares to innovate. The point being, everyone has to keep using the same shit invented 20 or 40 years ago, and pay, pay, and pay again to some bastard who neither invented nor encouraged invention [1], but simply invested into exclusive rights. This was true for the steam engine, and it is true for the latest, smallest, sexiest computers of tomorrow.

[1] Don't believe me? Look it up. Multiple studies were conducted, and no correlation was found between patent law strength on one hand and the rate of innovation on the other.

Re:They finally made money out of Linux. (0)

Anonymous Coward | about 6 months ago | (#45350629)

Empirically, the nation with the strongest enforcement on software patent law is also the nation that is responsible for most of the innovations in computing.

Nobody will notice. (1)

intermodal (534361) | about 6 months ago | (#45349737)

Phones are so heavily subsidized that between the monthly payment and the deep discounts at time of purchase on the handset itself, the average user will never know nor care.

On the positive side, Microsoft can always find someplace to lose $2bn.

Re:Nobody will notice. (0)

Anonymous Coward | about 6 months ago | (#45349901)

The manufacturer doesn't really care, either; they were used to paying Microsoft some token per-device charge for Windows Mobile 6, and now they pay a similar charge for Android.

It was telling that Barnes and Noble, the industry outsider, was the only one to fight this.

Re: Nobody will notice. (0)

Anonymous Coward | about 6 months ago | (#45349921)

But really they arent. Well in some countries like mine. You chose a phone with à subskription, or you can get à phone and à separate subskription. When you buy them together the phone is cheap but the subskription is Way more expensive if you compare To the same subskription without à phone. When you calculate the total cost it's the same +- à few $

Re:Nobody will notice. (1)

Sique (173459) | about 6 months ago | (#45350157)

This is mainly an U.S. phenomenon. In many other countries, you can get pure plans and unlocked phones.

1: Buy or use the courts to obtain trivial patents (1)

themushroom (197365) | about 6 months ago | (#45349791)

2: ???
3: Profit!

Re:1: Buy or use the courts to obtain trivial pate (1)

Anonymous Coward | about 6 months ago | (#45350045)

2: ???
3: Profit!

2. Hire lawyers.

Value added? (2)

Kongming (448396) | about 6 months ago | (#45349797)

I legitimately wonder how many (if any) of the features covered by the patents in question would not have been implemented in Android if not for the work of whoever filed the patent. If the answer is few or none, then patents are subtracting rather than adding value to society in this domain. If the answer is many, then there is at least an argument to be made.

Re:Value added? (0)

Anonymous Coward | about 6 months ago | (#45349943)

The only thing stopping Google from abandoning Microsoft's patents is that the end result would be worse than all the cheap Chinese rip-off tablets and phones. If the value added to the trinket wasn't greater than the cost of adding it, it wouldn't be there. (this remains true with governmental interference, as the value to the product then adds in the negation of whatever fine would be incurred by failing to follow the legislation)

Re:Value added? (4, Interesting)

Charles Duffy (2856687) | about 6 months ago | (#45350191)

The only thing stopping Google from abandoning Microsoft's patents is that the end result would be worse than all the cheap Chinese rip-off tablets and phones.

That's only potentially true when the patents are disclosed. It's fashionable to not disclose what the specific patents argued to be infringed actually are (or the mechanics of how they're infringed) when trying to license a portfolio.

Can't work around a patent when you don't know what it is.

Re:Value added? (1)

Gothmolly (148874) | about 6 months ago | (#45350107)

You can divide a sandwich among many, but you cannot digest it in a collective stomach. The purpose of a patent is not to add value to society.

I don't go scanning patent filings when working (1)

Chirs (87576) | about 6 months ago | (#45350273)

I don't know about you, but I certainly don't go searching patent applications when implementing something.

I'd argue that if multiple people independently invent something that is covered under patent then the patent should be invalidated as too obvious.

Re:Value added? (0)

Anonymous Coward | about 6 months ago | (#45350725)

There are no specific patents in question. Instead there are thousands of patents in a war chest that Microsoft threatened to use to sue with if not paid licensing fees. The threat is not the cost of losing that law suit, the threat is the cost of defending that law suit. Whether you get sued has nothing to do with what is implemented in Android. You are certain to be sued by anyone with a war chest of patents unless you enter into a licensing agreement. It is clearly subtracting value since anyone with a war chest of patents will maintain that war chest by filing for (or buying) new patents to replace the ones that expire. As a consequence the duration of a patent becomes meaningless since patents are measured by the number of boxes you can fill with them when printed out on legal paper and sent to the law offices of the defendant and not by their merit. This is why the war chests of defunct companies are bought for billions of dollars. They represent a multi billion dollar revenue opportunity for subtracting value from society like a giant leach on the tech sector.

Re:Value added? (2)

tlhIngan (30335) | about 6 months ago | (#45350887)

I legitimately wonder how many (if any) of the features covered by the patents in question would not have been implemented in Android if not for the work of whoever filed the patent. If the answer is few or none, then patents are subtracting rather than adding value to society in this domain. If the answer is many, then there is at least an argument to be made.

Except Android works around a bunch of them, and some of them are to the benefit of them all because it forced Google to innovate and we're better for it.

Take, for example, the "rounded corners" patent - it actually covers a screen layout of a grid of icons with a static bottom panel. Android worked around it by having a "home screen" and a launcher, and adding widgets to said home screen (thus not being a grid of icons anymore). So now we're better for having both options available - a grid of icons like iOS, and a homescreen/widgets/launcher model like Android. Unless you really wanted Android to just copy iOS and be a grid of icons, which even if it wasn't patented, would really be boring and copycat, rather than something new and innovative.

And then take the FAT32 patent Microsoft asserts. Well it forced Android to fix its broken external storage model and as of ICS, become a unified storage. If you never lived through the confusion that was being unable to do stuff (because some storage was full)...

There are plenty more patents Google worked around that are neat little touches in Android, and I say we're better for it rather than simply being able to just copy what someone else did.

Article rotation (0)

Anonymous Coward | about 6 months ago | (#45349809)

It seems like about every three months or so an article about this makes its way onto /.

Fuck (0)

Anonymous Coward | about 6 months ago | (#45349925)

A product that a company tries to kill is generating massive profit for them via extortion. Fuck them.

Is Apple paying the same royalties? (1)

swb (14022) | about 6 months ago | (#45349939)

And if not, what features/functions of Android are the patents for? It strikes me that most things Android does that would be covered by a patent would also apply to Apple.

Now, Apple may have other cross-licensing/patent agreements for other stuff so they aren't making a cash payment to MS, but instead a payment in kind, but I'm still curious what Android does that MS holds patents on.

Re:Is Apple paying the same royalties? (1)

Pinhedd (1661735) | about 6 months ago | (#45350139)

Apple and Microsoft have a lot of long running cross-licencing agreements which almost certainly cover the patents in question.

What about the manufacturers? Google? (1)

jfbilodeau (931293) | about 6 months ago | (#45349941)

If Microsoft is making $2,000,000,000 off Android, how much is Google and the manufacturers making off the platform?

Re:What about the manufacturers? Google? (0)

Nethemas the Great (909900) | about 6 months ago | (#45350117)

What difference does that make? That's $2B that could have been left in our collective pockets were it not for the trolling. The funding of dishonest business models has to stop. Google didn't purchase inventions from Microsoft, Google is paying Microsoft so that they may use the hard work of Google's own engineers.

Re:What about the manufacturers? Google? (3, Insightful)

Pinhedd (1661735) | about 6 months ago | (#45350199)

Microsoft isn't patent trolling here. They would be patent trolling if they were simply holding onto broadly defined patents to use them offensively. The patents in question, which I believe relate to data storage and file systems, have been used by Microsoft for a very long time and have been challenged unsuccessfully before. Microsoft's own engineers did the work, not Google's. Google and various Android manufacturers are free to not implement them.

Re:What about the manufacturers? Google? (5, Insightful)

Microlith (54737) | about 6 months ago | (#45350341)

They're trolling.

They would be patent trolling if they were simply holding onto broadly defined patents to use them offensively.

So they're indirect patent trolls via Intellectual Ventures and Rockstar?

Google and various Android manufacturers are free to not implement them.

Not as long as Microsoft filesystems are the de-facto file systems for SD cards by virtue of their desktop monopoly.

Re:What about the manufacturers? Google? (0, Insightful)

Anonymous Coward | about 6 months ago | (#45350591)

Not as long as Microsoft filesystems are the de-facto file systems for SD cards

Google and Android manufacturers are free to not include SD card readers. Duh.

Just because you won't ever invent anything doesn't make patents a bad thing. Patents just seem bad to you because you'll never invent anything.

Re:What about the manufacturers? Google? (1)

jfbilodeau (931293) | about 6 months ago | (#45350755)

There is a difference between an invention and an idea. There is also a difference licensing and extortion.

Re:What about the manufacturers? Google? (1)

spire3661 (1038968) | about 6 months ago | (#45350803)

Your logic is bad. Patents are held up by the State in MY name, every citizen has a dog in this fight.

Re:What about the manufacturers? Google? (0)

Anonymous Coward | about 6 months ago | (#45350821)

Not as long as Microsoft filesystems are the de-facto file systems for SD cards

Google and Android manufacturers are free to not include SD card readers. Duh.

Just because you won't ever invent anything doesn't make patents a bad thing. Patents just seem bad to you because you'll never invent anything.

blech... We're all worse off from this, even if you've bought into the idea that you might _too_ get rich from patents one day. Spoiler alert - you won't.

Re:What about the manufacturers? Google? (1)

Trogre (513942) | about 6 months ago | (#45350923)

Better yet, keep the SD cards and format them with good file systems like ext4.

Data storage and file system patents (0)

Anonymous Coward | about 6 months ago | (#45350597)

You can patent a file system layout that stores 11 characters for file name and three for file extension, and puts those in specific places on the disk. But is that really invention? A minutely different layout would be a whole new "invention". Now if an operating system mounts the "invention", everyone plus dog has to pay tax on the "invented" layout. How are we benefiting society here? If the patent system pretends to promote benefit to society, trivial compatibility shouldn't be "invention".

Re:What about the manufacturers? Google? (1)

whoever57 (658626) | about 6 months ago | (#45350659)

Microsoft isn't patent trolling here. They would be patent trolling if they were simply holding onto broadly defined patents to use them offensively. The patents in question, which I believe relate to data storage and file systems, have been used by Microsoft for a very long time and have been challenged unsuccessfully before.

Citation? B&N challenged the patents and it resulted in a partially sealed settlement. The patents were judged on their merits.

Also, how can it not be trolling when Microsoft approaches manufacturers with "Android/Linux violates our patents, but we won't tell you which patents"?

Re:What about the manufacturers? Google? (1)

afidel (530433) | about 6 months ago | (#45350231)

Trolling? MS makes a product in the mobile space, and has for a LONG time (see Windows CE, and CE based phones), they don't meet the definition of a patent troll in any way, shape, or form.

Re:What about the manufacturers? Google? (0)

Anonymous Coward | about 6 months ago | (#45350795)

I'm no fan of Microsoft, but I just want to point out that there are/were about 900 million android devices sold in 2013, so that's only $2.22 per device. You're definitely not missing that money.

I paid $100 for a "cheapo" android device just to tinker around with (yeah, I know they sell cheaper $70 ones at Fry's, but those are only 4.0 or 4.1, so they can't access the Google Play store), and I'm 100% sure the store would have kept the same price if it had cost them $2.22 less, so I think your argument that it would be in our collective pockets is a fallacy, unless you're a shill for the retail industry.

really? XBox? we sure about that? (1)

nimbius (983462) | about 6 months ago | (#45349949)

of all the products Redmond hasnt ritualistically pedaled into the ground, XBox seems to have defied even ballmers best attempts. their unfortunate XBox 1 unveiling which included an actual redaction of features and freedoms when compared to its competitors was certainly bad PR, but its not a killing stroke. XBox still maintains excellent game titles, and despite the hardware being plagued with flaws a return policy that basically sends you a free one console when yours unpredictably dies. its got netflix support, so you get a good selection of movies as well.

though id say XBox has its days numbered with Sony switching to the x86 platform. if fable, halo, and things like gears of war get a wild idea to move to Playstation, there isnt much incentive for customers to maintain their relationship with Microsoft. And the current 360 customers who remember the DRM snafu at the Xbox 1 release will certainly consider it a selling point if left 4 dead isnt exclusive anymore.

Re:really? XBox? we sure about that? (0)

Anonymous Coward | about 6 months ago | (#45350063)

I think a bit of hollywood style accounting is going on at MS

Re:really? XBox? we sure about that? (4, Interesting)

ilguido (1704434) | about 6 months ago | (#45350229)

Xbox is still there only because M$ has deep pockets. The original Xbox lost billions, the 360 lost a couple more billions in its first two years on the market and then never made a steady profit, they can also hide the development expenses for the Xbox in their R&D division, not to mention the expenses for the development of the Xbox OS. The Xbox would not be a viable platform for anyone else, but M$. That's a fact.

Re:really? XBox? we sure about that? (1)

Swampash (1131503) | about 6 months ago | (#45350743)

At a guess I'd say Xbox has cost Microsoft somewhere north of 36 billion dollars for development costs, annual losses, and the write-down because of the Red Ring of Death fiasco.

Being able to write off 36 billion dollars and not care is VERY deep pockets.

Re:really? XBox? we sure about that? (4, Funny)

PPH (736903) | about 6 months ago | (#45350505)

its got netflix support

What doesn't? I think my hedge clippers have Netflix..

Re:really? XBox? we sure about that? (3, Funny)

decipher_saint (72686) | about 6 months ago | (#45350535)

What doesn't? I think my hedge clippers have Netflix..

Does it work without a Hedge Clippers Live Gold subscription?

Patents protect innovation? (-1, Flamebait)

edibobb (113989) | about 6 months ago | (#45350095)

Microsoft is using its patent portfolio to stifle competition and blackmail its competitors. It has nothing to do with protecting the inventor to promote competition. That's why nobody has or will, in the foreseeable future, write a new desktop/laptop OS that competes with Windows.

In turn, that's why Microsoft can treat its customers like cattle and force upon them such fine products as Windows 8.

Re:Patents protect innovation? (0)

Anonymous Coward | about 6 months ago | (#45350517)

The fact that the patents are licensed under RAND, and are not discriminatory in terms of who can purchase them, and that Android is trouncing MS' own product line is the polar opposite of "stifling competition". These RAND patents have the inverse effect of enabling competitors to enter the market.

"That's why nobody has or will, in the foreseeable future, write a new desktop/laptop OS that competes with Windows."

Possibly because the desktop is a concept Microsoft if not invented, popularized. It was a niche market at best before MS' entry. Apple is entirely capable of producing a competing product (and they do), but price themselves out of competition because they're not after that. The various corporations behind Linux are probably capable of doing so as well, but there's little money in it for them, and they tend to focus on other markets -- the people interested in building a competing product simply lack the capability to do so in this case.

Patents - Copyright for the 21st Century (4, Insightful)

runeghost (2509522) | about 6 months ago | (#45350283)

Patents aren't about promoting the progress of science and the useful arts, they're about a business model based on rent-extraction via arcane legal means. As alternative manufacturing options such as 3D printing mature (assuming they're not strangled by the patent titans) patents will become as obsolete and ineffective as copyright is now.

Re:Patents - Copyright for the 21st Century (3, Interesting)

Opportunist (166417) | about 6 months ago | (#45350849)

Oh don't worry, that will be the next war. If you thought the copyright war was fierce, wait 'til companies who sell some plastic junk for big bucks because their name is printed to one side or because the part breaks easily and may only be made by the original maker get to feel the loss when people notice that for the price that part costs they could as well buy a 3D printer and be independent from them forever.

Wait until their business model of vendor lock-in no longer works.

There are entire companies (and I'm not talking about mom'n'pop shops) dependent on that very model of selling appliances dirt cheap and making money with the spare parts and the consumables. And printer manufacturers are the least of your concern in this matter. You're about to see the battle between people with 3D printers vs. the car industry and its associated industries.

And this will be very, very ugly. If you thought the MAFIAA had ties in politics, wait 'til this turd hits the spinning blades. This time a LOT of jobs are on the line, and I'd be very surprised if that one goes down with a breeze. Expect some legal shit to come down that makes the whole copyright legal bull seem legit, sane and balanced.

95% margin? (1)

El_Muerte_TDS (592157) | about 6 months ago | (#45350309)

So wtf does MS do for the 5%?

Re:95% margin? (1)

Anonymous Coward | about 6 months ago | (#45350407)

Provide job security for lawyers.

Re:95% margin? (0)

Anonymous Coward | about 6 months ago | (#45350423)

Brute squad.

How do you think they secure these royalties?

By the way, just because an analyst says it's so doesn't make it so. I'd like to see the sources or calculations. An analyst wants MS to dump their xbox shit, they can google "MS android royalties", look for a link that most exaggeratedly backs up their wishes, and state it. Analysts don't have the official numbers from MS, so this is not official.

He estimates (2)

jamesl (106902) | about 6 months ago | (#45350399)

Rick Sherlund estimates. He doesn't know. Nobody knows except very senior management at Microsoft and Google.

The report also contains the following: "Sherlund believes Microsoft needs to spin out Xbox. He sees it as an orphan group at Microsoft that doesn't really fit with anything it's doing."

I guess he hasn't heard of the "Three Screens."

Re:He estimates (2, Informative)

Anonymous Coward | about 6 months ago | (#45350695)

XBox is Microsoft's doorway into the home. Companies have been fighting for decades to control the living room and there are no clear winners (Wii did well but didn't win). XBox can provide a unified system between TV, computer, and mobile device through Azure. When Microsoft does unification well there would be no need to use any non-Microsoft system.

There's also the importance of diversification. A company as big as Microsoft shouldn't have only one product.

Sherlund is blind if he can't see how Microsoft can use it or how the other consoles could eat away at Microsoft's other services.

Just as bad as getting away with rape (-1, Flamebait)

Xyrx (109960) | about 6 months ago | (#45350459)

By Microsoft earning $2 billion from licensing fees for vague patents it's generally applying, and by using FUD to re-enforce those unproven ideas, then PROFITING from this science fiction, is akin to a rapist getting away with it, only to continue raping other victims over and over again. Someone needs to stand up and kick em in the balls.

At least someone is making money from Android (1)

BLToday (1777712) | about 6 months ago | (#45350593)

At least someone is making money from Android besides Google and Samsung. I really wish Sony can get their act together and release an amazing phone. They have it in them to be able to do better than Samsung and Apple.

Good for them (0)

Anonymous Coward | about 6 months ago | (#45350599)

I mean their mobile division needs to make money with something.

All the more reason for Rockstar to attack! (2)

deviated_prevert (1146403) | about 6 months ago | (#45350613)

Now if they absorb the Blackberry patents they will be unstoppable in the mobile highway patent troll robbery market. Hell people will not even notice if they become the worlds largest patent troll, seems that they are much better at that than actually creating software. Unusual bedfellows Apple and Microsoft?

Microsoft's so called "IP" is being more valuable than their actual production of software. Microsoft is becoming little more than a huge IP and patent troll firm that has managed with their operating system monopoly, to bully the hell out of everybody including the Government of the US and companies like Apple and Sony into going along with the IP value bullshit.

It was Microsoft and others that created this situation. This overvaluation of IP is to a large extent responsible for the complete devaluation of the US economy and the rabid denuding of the core of the very economy, which was the skilled and diverse middle class work force within the US.

IDEAS are cheap the implementation of ideas is where value is added. If we do not change the patent system soon the economy of the US will completely collapse under the burden of paying for overvalued so called Intellectual Property Values. It distorts and corrupts the very core of an economy.

The English realized the folly of the Royal Monopolies and how they were strangling trade and enterprise, Queen Elizabeth the first in her latter years finally began to see the value of the small shop keeper, wine merchant and candle maker. The modern day Lords of IP like Microsoft and other need to be brought down a notch and the economy will blossom as a direct result of their dismemberment, the same way the break up of Standard Oil and US Steel did.

Re:All the more reason for Rockstar to attack! (0)

Anonymous Coward | about 6 months ago | (#45350819)

You are using the term "patent troll" to mean anyone who is enforcing their patent rights, correct?

Google should start taking them to court. (0)

Anonymous Coward | about 6 months ago | (#45350919)

Google should start taking them to court. I do not know why they are not doing something about it and letting all this back room blackmail stuff go on. At least Barns and Noble had the balls to stand up and they are way smaller than Google; can't wait for those results come out. Now that MS and Apple marriage happened when they took ownership of Nortel patents they can't wait to attack someone (especially Google). Google better buy Blackberry or Android's days are numbered. These patents laws are stupid, they've been changed from their original intent to be come a bad taste in peoples wallets and ideas; all this just to satisfy someone hunger for money.

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