Google defends stance on FRAND patent terms

Google will not offer Motorola's standards-essential patents on unreasonable or discriminatory terms, the company has promised the IEEE standards body and the wider mobile industry.

Google, which is buying Motorola, made the commitment in a letter to the IEEE on Wednesday, a day after it emerged that Apple had complained over "a lack of consistent adherence" in the mobile industry to the principles of fair, reasonable and non-discriminatory (FRAND) licensing terms for standards-essential patents.

However, critics have noted that what Google considers to be a reasonable licensing royalty is still seen as excessive by its rivals.

"This letter is intended to assure you and any potential licensees that, following Google's acquisition of MMI [Motorola Mobility], Google will honour MMI's existing commitments to license the acquired MMI essential patent claims on RAND [reasonable and non-discriminatory] terms," Google wrote, adding that the letter was "irrevocable".

In the mobile industry, technology standards such as 3G involve large numbers of patents that are pooled together under the agreement that FRAND or RAND terms will be applied. These terms ensure that the patent holder, often a phone company, can only charge rivals a reasonable rate to license those patents. They are also designed to stop companies charging different partners different rates, which might reinforce monopolies and distort the market.

FRAND terms have become central to much of the patent war that is raging within the mobile industry. Companies such as Samsung and Motorola are suing rivals including Apple and Microsoft over the infringement of standards-essential patents that should only be licensed under FRAND terms. Indeed, the European Commission is investigating Samsung over the matter.

Apple's letter to ETSI, the European telecoms standards body, was written in November but only brought to light by The Wall Street Journal on Tuesday. In it, Apple said it "believes the industry would benefit from a more consistent and transparent application of FRAND, especially related to the licensing of cellular standards-essential patents".

Apple said it was committed to the FRAND principles, "provided that other parties reciprocate". It proposed a revised framework, including a ban on any company trying to block a rival from selling products because of an alleged infringement on a FRAND-protected patent.

Cisco lent its support to Apple's stance in a letter dated 31 January, but also revealed this week. Microsoft also posted a short blog on Wednesday, saying it agreed.

Motorola's clashes with Apple and Microsoft have seen Motorola demand a 2.25 percent licensing fee for the patents it is defending — not just for the component that uses the technology, but for the net selling price of the whole device.

Apple and Microsoft have said this percentage is excessive and not in line with the "reasonable" element of the FRAND principles. As patent observer Florian Mueller has noted on his FOSS Patents blog, 2.25 percent of the price of a 3G-enabled car would be a lot of money.

However, in its letter on Wednesday, Google said it viewed the 2.25 percent cap as reasonable and would continue to apply it once the Motorola acquisition has gone through. It also reserved the right to apply for injunctions on infringing products, if the manufacturers of those products did not agree to its terms.

"Google could have put on a page… everything that other companies in the industry, and consumers using the ubiquitous standards over which Motorola is suing others, need to be reassured about," Mueller wrote. "Look at Apple's and Microsoft's concise and crystal clear statements. Why can't Google provide clarity like that? Because its four pages aren't meant to improve anything. Google is basically saying that it will do exactly what Motorola is already doing now."