Day: July 31, 2012

Above the Fray?: The Effects of the Patents Wars on the Cloud

Effects of Patent wars on the cloud

In the most recent phase of the Wireless Patent Wars, the jury trial of Apple’s smartphone patent infringement suit against Samsung began earlier this week in San Jose, California. Apple contends that Samsung stole aspects of the iPhone and iPad for its Galaxy Nexus smartphones. Samsung has argued that it had been developing iPhone-like devices before the iPhone’s initial release in 2007. A federal judge sided with Apple in a June 2012 injunction against Samsung’s sale in the United States of the Galaxy Nexus smartphones. However, earlier this month a British judge decided in favor of Samsung over Apple in a case involving tablet patents, famously ruling that the Galaxy tablet wasn’t “cool” enough to be confused with the iPad.

This graphic captures the complexity of the Wireless Patent Wars, just as the Apple-Samsung dispute reflects the Wars’ ambiguity, pettiness, and significant costs. The main combatants: Apple, Samsung, Google, Microsoft, RIM, and HTC. What they’re fighting over: patents for smartphones, tablets, and all the underlying and supporting technologies of mobile devices. The conflict began in earnest in 2011 when Google purchased Motorola Mobility for $12.5 billion for no other reason than to acquire 17,000 technology patents to defend itself from competitors’ lawsuits (or what it classified as “a hostile, organized campaign against Android [Google’s open-source mobile operating system] by Microsoft, Oracle, Apple and other companies, waged through bogus patents”). Google also won the first major legal victory of the Patent Wars in May when a jury ruled that its Android OS violated the copyrights but not the patents of Oracle’s Java application programming interfaces.

Business and technology commentators have criticized the Patent Wars as being harmful to consumers, businesses, innovation, and the economy. L. Gordon Crovitz of the Wall Street Journal pointed out in 2011 that the $12.5 billion Google spent on Motorola’s patents could have been used for research and development or hiring new employees. At the same time, Crovitz warned that a compromise between mobile technologies resulting in collaborative “patent pools” would also stifle innovation by reducing competiveness. He blamed the outdated patent filing system of the United States that fails to account for the complexities and overlapping technologies of software: “Software almost always builds on previous work, so patents rarely reflect the kind of original work that patent law is supposed to protect.” In a more recent article, InformationWeek’s Patrick Houston criticized the Patent Wars for many of the same reasons and offered some statistics on the financial impact of patent ligation: 5,842 patent suits were filed in the United States in 2011 with direct costs of $29 billion, or 10% of the combined R&D budgets of every business in the country. Worse, Houston also notes that most of these suits were instigated against small businesses, with the median revenue of the defendants being $10.8 million. Crovitz and Houston both suggest radical patent reform as a way to avoid costly and counter-productive corporate lawsuits. A 2011 patent reform law (America Invents Act) only adjusted the procedures for filing and challenging patents.

Cloud computing may not be immune to the effects of the Wireless Patent Wars. The cloud lets smartphone and tablet users access their files and powerful applications from anywhere.  The cloud’s mobility and its ability to compensate for the limited processing power of mobile devices (in the form of web-based apps) account for a large percentage of the utility and success of smartphones and tablets. The Patent Wars may affect mobile users of the cloud by raising their costs (indirectly by legal fees and high-priced patent acquisitions) or disrupting their service (if they own a patent-infringing device). Cloud computing technology vendors could also engage in their own patent disputes. But for now the direct financial and technical effects of the Wireless Patent Wars on cloud computing remain fairly limited.

IronOrbit leverages our partnerships with IT industry leaders such as VMware and Citrix to build unique and valuable cloud-based solutions. We combine into many of our products the industry-best features, platforms, and hardware of our various partners. IronOrbit’s focus has always been on building highly-customized cloud-based solutions that match the IT requirements and preferences of our clients exactly, not upon owning and restricting proprietary software. We favor a fair and open exchange of technologies that respects the rights of the patent and copyright holders while leaving open the paths to alternate uses and further innovations.