The Wall Street Journal reports that Apple filed a letter with the European Telecommunications Standards Institute, asking for governing rules on the FRAND (fair, reasonable and nondiscriminatory) licensing of patents essential to manufacture a mobile phone.
Apple has been on the receiving end of a number of patent infringement lawsuits filed by companies like Samsung and Motorola. Many of these patents have, over time, become a part of industry-wide standards which most mobile devices support. Standard bodies require these patents to be licensed on FRAND terms, but Apple, in the letter, says that there is a lack of consistency in the licensing terms of such patents.
WSJ reports:
Apple said in its letter--which was dated Nov. 11, but not previously disclosed--that the lack of clarity on what is fair, reasonable and nondiscriminatory has led many companies to ask unusually high rates and sue one another claiming they infringed on one another's patents.
"It is apparent that our industry suffers from a lack of consistent adherence to Frand principles in the cellular standards arena," wrote Bruce Watrous, Apple's intellectual property head.
Apple additionally says that, FRAND patents shouldn't be used to seek injunctions on certain products.
It also proposes a framework wherein these patents are licensed at an "appropriate royalty rate," with a common royalty base.
Apple defines an appropriate royalty rate as one that is computed after taking into account, the proportion of essential patents (granted or pending) held by a company as compared to the total essential patents involved in the same technology.
Generally royalties are levied in terms of percentage. For example, Motorola had demanded a 2.25% royalty on all of Apple's 3G capable products. Apple proposes that a common base exist, against which this royalty is applied. FOSS Patents explains:
Let's assume BMW builds a 50,000 euro car that comes with a built-in UMTS-capable computer system. Now let's take Motorola's 2.25% royalty demand as an example. What is it they want to get 2.25% of? The entire car? That would be more than 1,000 euros for a few wireless patents. The computer system? Or wouldn't it actually make sense to multiply that percentage just with the cost of the baseband chip, the component that provides basic telecommunications functionality and is sold at a per-unit price between $10 and $15 including all of the relevant patent rights?
Apple's letter proposes the latter: "This common base, as between two negotiating parties, should be no higher than the industry average sales price for a basic communications device that is capable of both voice and data communications."
Apple's late entry into the mobile market puts it in a bad state when it comes to patents in the wireless industry. Recently it was forced to pull its 3G capable devices from the German online store for a brief period of time, when Motorola obtained an injunction against Apple.
To read the entire letter, head over to FOSS Patents, where Florian Meuller explains Apple's proposed solution to the FRAND problem in great detail.
[via WSJ]
It appears crApple doesn’t like the taste of it’s own medicine. That’ll teach the greedy f@#ks. Like I said when Apple started all this “patent” legal crap. I’m not sure if it was on here or on one of the forums I’m a member of.
“Laptops all follow a similar design format. Netbooks even more so, yet there have been no companies laying claim (to design patents) and seeking damages for infringement from other manufacturers of laptops/netbooks that I’m aware of.
Why should Apple suddenly care what it costs? The expense will be bourne by the consumer purchasing the product. Surely you can afford the hit on previous devices considering your massive mark-up on your products (iphone 4s cost £130 sells at £499)
Is it right to infer from this article that Apple have neglected (purely by administrative oversight) to pay royalties for the technologies deployed. Tut tut Apple naughty naughty! Leagal team too busy screwing other companies to notice the oversight were they?
“Generally royalties are levied in terms of percentage. For example, Motorola had demanded a 2.25% royalty on all of Apple’s 3G capable products.”
Paying this would still leave you with a handsome profit per device. You’re just being greedy.
Motorola is entitled to demand that as compensation. Personally I’d ask for backdated interest as well. It might have cost Apple less if they’d paid upfront. A synical individual might infer Apple prefered to keep the money for themselves. If only I could find a synical individual. (oh look a mirror)
Is it possible that Apple executives have their heads so far up their own asses that they believe only Apple should be allowed the privelidge of charging royalties and issuing lawsuits etc.
If you’d like that to be the case Apple executives you should try bribing (oops freudian slip there) I mean lobbying the respective law makers or… failing that add a new clause to your user agreement stating that “by using this Apple device the user agrees to pay a part of any legal expense / fine / royalties incurred by Apple in their day to day quest to own/rule everything.
That would keep your profits safe.
In closing.
If I were the individual at the European Telecommunications Standards Institute who recieved your letter I’d wipe my ass with it and send it back by return post.
Time you learnt a lesson Apple. You won’t get any sympathy from me. Unless you add a clause to the user agreement forcing it out of me.
I hear ya buddy!
Next time you decide to ‘pen’ a rambling diatribe; spell check, grammar check, grab a dictionary and spare us your ignorance.
Fanboy much?
so the bist yoo can do is have a goe ot mi spilling orrors grimmer and doction on whit a wroted?
I look forward to reading your grammatically correct and correctly spelt (or is that spelled. Neither throw word into a frenzy of green squiggles. Help!) oppositional diatribe.
Oh and by the way… The grammatical and spelling errors may just have been (UN) intentional.
I love it when folks attack the spelling/grammatical errors. It suggests they have nothing better to comment on.
Thanks for biting the hook.
Toodles (that means goodbye and is correctly spelt/spelled)
My “bads” I’m just toying with you now. It’s been a quiet day. I’m bored
This game is endless.