Several mobile industry giants and ostensible competitors have allied to accuse Google and many top-tier Android licensees of sweeping patent infringement. According to Rockstar Bidco, a humorously named consortium that counts Apple, BlackBerry, Ericsson, Microsoft, and Sony as its members, Google infringes with its Android OS on several patents related to Internet search and mobile computing.
"Google has infringed and continues to infringe," the complaint reads. "Google's acts of infringement have caused damage to Plaintiffs, and Plaintiffs are entitled to recover from Google the damages sustained ... as a result of Google's wrongful acts in an amount subject to proof at trial."
Asustek, HTC, Huawei, LG Electronics, Pantech, Samsung, and ZTE are also named in the suit.
The details are a bit tricky. But the suit dates back to April 2011, when Nortel announced its intention to sell 6,000 patents related to "wireless, wireless 4G, data networking, optical, voice, Internet, service provider, semiconductors, and other patent portfolios." Google immediately swooped in to purchase the patents for about $900,000 in a bid to protect Android from patent litigation. But competing bids drove up the price, and Google eventually offered $4.4 billion for the patents.
But it wasn't Google that issued the winning bid. Instead, Apple and Microsoft allied with smaller industry players to keep them out of Google's hands, and a consortium they created, called the Rockstar Consortium, placed the winning $4.5 billion bid for the Nortel patents. So Google had to settle on Motorola Mobility, a smartphone manufacturer that also owned a treasure trove of mobile industry patents. Unfortunately for Google, those patents have thus far proven far less valuable than expected, casting the firm's expensive $12.5 billion purchase of Motorola Mobility into question.
And now Rockstar is suing Google, and many handset and device makers that license Google's Android OS, which is widely considered to be an intellectual-property black hole.
The irony is that the "damages" claimed by Apple, Microsoft, and the other Rockstar companies largely occurred before they ever owned the patents. But by bidding over $4 billion for the patents, Google has also implicitly proven that those patents are in fact quite valuable. And if the Rockstar suit succeeds, Google and its Android licensees could have to pay damages, halt the distribution of Android devices, and fix Android on all of those devices out in the world so that it is no longer infringing or pay licensing fees.
The appeal of Android, of course, is that it's free. But Android isn't really free in a number of ways. It of course rides on the back of—some have said it is outright stolen from—the innovative mobile OSs that came before it. And though Android licensees don't pay for the core OS, they still need to license apps and associated services, and some pay licensing fees to firms other than Google. (Microsoft is a key player in this particular effort.) If the Rockstar suit prevails, Android could become dangerous and expensive to license.
Many feel that any mobile industry patent maneuvering is just an attempt to halt or slow innovation. But Google's decision to give away Android is in many ways just a classic example of product dumping, in which the real goal is to drive users of the supposedly free system to Google's ad-supported services like Search. And that, others argue, does more to harm innovation than any patent suits.
Android obtained a record 81 percent market share in the smartphone market in Q3 2013, according to IDC. It also surpassed the iPad in the tablet market a year ago and is closing in on 65 percent market share in that market, as well.