Friday, August 13, 2010

Oracle vs. Google: A very big deal indeed

Bloomberg Television this morning is covering the reaction to the Google/Verizon "policy statement", which effectively means nothing except that Google likes its business relationship with Verizon and wants to keep it. Yesterday's lawsuit filed against Google by Oracle, on the other hand, potentially means a great deal, up to and including wrecking Google's Android strategy, Google TV, and the business plans of Motorola, HTC, Sony, Adobe and many other companies.

Oracle has charged Google's Android with deliberately violating seven of its Java-related patents that it got when it acquired Sun Microsystems, plus unspecified copyright violations. Oracle is asking for a permanent injunction against Android, the destruction of all devices that use Android, and unspecified financial damages. I'm not an attorney, and I'm definitely not a patent attorney, so I'm in no position to determine the validity of Oracle's charges. However, two posts this morning, from James Gosling, the father of Java, and Miguel de Icaza, suggest that Google and its licensees may very well have something serious to worry about.

Sun got $1.6 Billion (US) from Microsoft for infringing its Java patents, but that's likely to be less than the lowest price that Oracle is going to get from Google. Unless Google can somehow invalidate all seven patents plus get past the copyright infringement charges, a process that could take years, the fate of Android and every product dependent on Android is going to be up in the air until Google settles. Oracle may also go after individual Android licensees, but I think that's unlikely.

However, one result of the case may be that Google will have to charge for commercial Android licenses. The price will probably only be a fraction of what Microsoft will charge for Windows Mobile 7, but it will take Android out of the "free for all" category. It will change the financial equation for handset, tablet and set-top box manufacturers--not enough to push them off of Android, but enough to decrease profit margins or increase prices.

Even if Google completely redesigns Android not to use any Java intellectual property, it will still have to pay Oracle for past infringement, and the resulting "new" Android is highly unlikely to be backward-compatible with old versions and old apps.
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