Can Google Protect Its Partners?

Maybe Google (Nasdaq: GOOG  ) should adopt a secret identity, superhero-style. Batman and Superman maintain top-secret alter egos in order to protect their friends and family; Google's partners might appreciate a similar protective measure.

OK, so the cat is far out of the bag already: everybody knows exactly which company stands behind the Android platform for smartphones and other high-tech devices. That makes Motorola (NYSE: MOT  ) an easy target when Microsoft (Nasdaq: MSFT  ) is looking for a legal target whose misfortunes will hurt Google's Android efforts.

Microsoft has filed a patent infringement lawsuit against Motorola over vital parts of the Android operating system such as the ability to read emails on the go and scheduling appointments on your phone. It's far from the first attempt to hobble Android by means of legal wrangling:

  • HTC, which makes many of the popular Droid handsets for Verizon (NYSE: VZ  ) , already signed a license agreement with Microsoft to head off this awkward position but also got hit by an extensive suit by smartphone rival Apple (Nasdaq: AAPL  ) .
  • Oracle (Nasdaq: ORCL  ) chose to forgo the indirect tactics and went after Google directly instead, arguing that the very platform owes its existence to Oracle's Java and Google has no license to publish any of it.

In an interview with The Wall Street Journal, Microsoft CEO Steve Ballmer implied that Android won't be license-free forever: "It's not like Android's free. You do have to license patents. HTC's signed a license with us and you're going to see license fees clearly for Android as well as for Windows." Currently, Google charges no fees for using or selling Android software. Ballmer clearly wants that to change -- and he wants at least an ironic cut of whatever fees Google and its partners are pulling in.

If Microsoft and others continue their legal pressure on Android partners, it seems inevitable that one of two things will happen:

  • Google is forced to implement a blanket license fee for Android sales, probably passing all of it on to antagonists like Apple and Microsoft. This removes one key ingredient from Android's recipe for success.
  • To prevent that, Google could and should jump into the legal battles with both feet. I don't know if Android has a legal leg to stand on, but that issue has never stopped lawyers from bickering in court until the original issue becomes irrelevant anyway. A filibuster action could be all Google needs here while waiting for the patents under dispute to go stale or irrelevant, or other companies tire of the legal battles and settle for less onerous terms.

I think Android is too important to leave Google's partners hanging, unsupported by the spider at the hub of the Android technology web. The rest will be up to the courts.

Whether you agree or disagree, I'd love to hear where you think Google's legal team is going with this. Post under your secret super-investor moniker in the comments box below.

Google and Microsoft are Motley Fool Inside Value recommendations. Google is a Motley Fool Rule Breakers choice. Apple is a Motley Fool Stock Advisor recommendation. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of Apple, Google, Microsoft, and Oracle. Try any of our Foolish newsletter services free for 30 days. True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.


Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1321212, ~/Articles/ArticleHandler.aspx, 9/17/2014 3:43:32 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement