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Summary:

It’s kind of amazing to consider that in just three short years, Google (NSDQ: GOOG) found its answer to critics fond of the “one-trick pony…

Android Sweat Drop

It’s kind of amazing to consider that in just three short years, Google (NSDQ: GOOG) found its answer to critics fond of the “one-trick pony” slur with Android, currently the world’s most popular mobile operating system and the vehicle for Google’s ambitions in mobile advertising and application development. But now that Android is on top of the world it is faced with the greatest crisis of its short life as barbarians armed with patents mill at the gates.

Forbes this week revisited an amazing anecdote from Gary Reback, the attorney best known for hunting down Microsoft (NSDQ: MSFT) in the 1990s and harassing Google at present, from his days at Sun as a young attorney. When confronted by lawyers from IBM seeking licenses for patents that Sun believed didn’t apply to any of its products, an IBM lawyer referenced its horde of around 10,000 patents and supposedly said: “Do you really want us to go back to Armonk [IBM headquarters in New York] and find seven patents you do infringe? Or do you want to make this easy and just pay us $20 million?” Sun paid.

Following Google’s inability to secure perhaps the biggest block of mobile patents ever put up for auction last week, the Android partners who have been key to its success are going to start seeing the mobile-computing equivalent of IBM–Microsoft–more and more frequently. Even before the Nortel patents were put in play Microsoft had launched a mobile strategy aimed at convincing Android partners that Android wasn’t really free: there was a patent-licensing toll that just hadn’t yet been collected.

But now that Microsoft, Apple (NSDQ: AAPL), Sony (NYSE: SNE), Research in Motion (NSDQ: RIMM), Ericsson (NSDQ: ERIC), and EMC control the 6,000 patents auctioned off by Nortel for $4.5 billion, Google is scrambling to figure out what to do next. The company declined multiple interview requests about the aftermath of the auction and the plan going forward, but a few interesting details emerged this week regarding the auction and its impact on Android.

Class War–Google has a way of stirring resentment among its peers, sort of like the know-it-all kid in high school who was also quarterback of the football team and just biding his time before waltzing into Harvard. That was evident in the aftermath of the auction, when *Reuters* posted an account of the bidding process fueled by anonymous quotes designed to make Google look as silly as possible, claiming that Google was “either supremely confident or bored” in making bids equal to famous mathematical constants and was unwilling to go above $4 billion.

While a source familiar with Google’s auction strategy confirmed that the company showed its irreverent side in the auction process, the source also said there’s no way Google took the auction lightly. It’s not like Google submitted three bids equal to mathematically significant numbers and hit the bar: contrary to the Reuters (NYSE: TRI) report, Google and Apple exchanged bids in $100 million increments until Apple (backed by the consortium) set the high-water mark at $4.5 billion during the 19th round of bidding. That account was verified in a report (click for PDF) filed by a monitor from the Canadian court system that was made public on Wednesday.

High in the mountains of Idaho, Google Chairman Eric Schmidt told reporters at the Allen & Co. conference this week that “the price exceeded our value threshold,” which is a little curious considering Google was reportedly ready to pay $6 billion for Groupon, a dubiously profitable company slated for an initial public offering at some point later this year.

The same source said that Google walked away when the bidding reached a point where it no longer made sense, sort of how buying real estate in the Bay Area can become a game of chicken when even the starting price far exceeds any sensible number. That may have been a mistake: without the patents, Google and its Android partners are back to square one, besieged on all sides by deep-pocketed and well-patented competitors who want a piece of its success for their own. Sometimes coveted objects are worth what people are willing to pay for, not necessarily what the algorithm says they are worth.

Division in the Ranks?–There’s no question that Android was a lifeline to a smartphone industry caught flat-footed by the debut of the iPhone in 2007. Companies like Motorola (NYSE: MMI) and Samsung, which had tried and failed to create their own mobile software for years, found themselves with the option of a good-enough mobile operating system that would allow them to design their own hardware, software, and services without having to do the heavy lifting. And lower-cost handset makers and wireless carriers were excited to be able to offer smartphones at competitive prices.

But the life of an Android partner isn’t necessarily easy. Application developers are in love with iOS and tend to treat Android as a necessary second-class citizen. Handset makers find themselves in the shoes of the Dells, HPs, and Gateways of the world a decade ago, who were dependent on Microsoft and Intel (NSDQ: INTC) to come up with breakthroughs to which they could add their own twists. Their attempts to set themselves apart from the pack can cause problems as Google tries to maintain compatibility, causing tension. And for all that, they’re not making much money.

And now those partners also have to deal with advances from Microsoft, Apple, Oracle, and perhaps the other members of the Rockstar Bidco consortium that won Nortel’s patents. HTC was derided by some for capitulating to Microsoft and signing a license deal a few years ago when this strategy first emerged and others, like Motorola, chose to fight. But now it looks smart, as Microsoft moves from town to town pointing toward its treasure chest of patents and asking for larger and larger checks made out to Steve Ballmer.

If Samsung cuts a deal, it will be hard for companies like Motorola and Barnes & Noble (NYSE: BKS) to argue that the patents are invalid or that their products don’t infringe when so many similar companies have endorsed the patents by signing a license. And even if Samsung does reach an agreement with Microsoft, it has another huge challenge in fending off Apple’s aggressive legal maneuvering.

So at a certain point, an Android partner must think very carefully about their operating system options if they’re going to have to pay something per handset one way or another. Both Microsoft and Hewlett-Packard (NYSE: HPQ) are shopping mobile operating systems these days, two companies backed by decades of patents, while Google offers basically no cover for its partners when it comes to patents. Companies that have made large investments in Android are not going to switch abruptly now that Android is the world’s leading mobile operating system, but they may start building Windows Phone 7 or WebOS businesses on the side, which could arrest future growth potential for Android and deny Google a chance to influence the development of mobile computing as much as it would like.

Plan B–It’s perhaps a bit of a stretch to call this a “plan,” but Google is essentially throwing open its arms to the intellectual property community, willing to listen to just about anyone with mobile patents for sale or rent. It’s going to have to get patent coverage somehow, and it doesn’t seem to care if that’s through one-off deals with small companies, large acquisitions, or even patent licensing deals with its foes. It’s also hoping that federal regulators change the terms of the deal while they review it, similar to how a patent sale involving Novell was altered by the Department of Justice following complaints, and has a pipe dream that Congress may stop playing chicken with the debt ceiling and embrace real patent reform.

This is a crucial summer for Android. It rose to prominence as the anti-iPhone, but has managed to unite Apple, Microsoft, and Research in Motion in a consortium of competitors who are trying to hit Google in its most vulnerable spot.

As Reback related years ago, modern patent litigation isn’t really all that different from a protection racket: you pay, or you get hurt. If Google wants to keep the Android miracle rolling, it’s going to have to find a way to offer its own brand of protection before its partners opt for peace of mind over loyalty.

  1. This is the same crud that SCO was throwing at IBM (with Microsoft money to fund it) and they gave them the finger. Eventually SCO lost out of a lack of evidence. I can’t see Google doing anything less. Microsoft and Apple have nothing on Android so eventually all of those people who paid will look like asses. Oracle probably has something to say but if they push too hard Google will just stop using their stuff just like Microsoft did to Sun over Java.

    Maybe, just maybe this mess will give MeeGo the opening it needs. It needs to be proven clean (it’s just Linux) and then handset manufacturers can adopt it wholesale. 

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    1. Henry_3_Dogg Saturday, July 9, 2011

      As I recall Sun specifically took action to stop MS propagating incompatible Java. They took damages but refused to allow MS’s incompatible Java to continue, effectively forcing MS out.

      Oracle should do the same with Android since it damages the value of Jave by weakening the compatibility of built java code. That’s the whole point of Java.

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      1. Those are two drastically different situations. If you want to look it up Sun stopped MS because MS created their own Java compiler that would only make code that ran on MS own OS. People would stumble into using MS compiler and effectively kill Java’s portability without knowing it. This is why MS lost. They had every right to go back to including Sun’s Java with their OS and make their compiler compatible. They chose neither. 

        Google’s situation is different. They chose to not use some of Sun’s libraries which my Java developer says are horribly written. Google created their own and Oracle doesn’t like this because Oracle doesn’t make money on code Google created. Anyone who writes Java code can decided if they want to use Oracles additional toolkits. This isn’t about portability, it’s about revenue. Oracle provides a free product and then tries to rope people into using paid add ons. Google chose not to.

         

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        1. That is only a piece of the puzzle.  In many cases, it looks like Google simply “decompiled” the Oracle/Sun code and called it equally horribly written un-GPL’d Google code.  In other cases, they distributed in the Android Source tree to their customers (the OEMs) Oracle/Sun code that was clearly marked not for re-distribution.

          In any case,, simply re-writing the code and keeping the interfaces and functionality the same do not protect you against patents (only copy-rights).  Patents deal more with the methods of black-box within the system.

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        2. Henry_3_Dogg Saturday, July 9, 2011

          I’m sure MS would have had equivalent excuses to justify their incompatibility. That’s just bullshit. Incompatible is incompatible and dilutes Java. You don’t need to use them, but them must be there for those that do.

          Otherwise you have no license. Tough.

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          1. Obviously you’re not a developer. Let’s say that Python includes support for a toolkit called Wx (it does). And let’s suppose that the python owners charged for this toolkit (they don’t). I’d still get to decide if I want to use it or not or use gtk+ or QT. It’s a bit more complex with Sun/Oracle because they stipulate that if you’re making mobile devices you need to use theirs. Google is calling bull and willing to go to court over it. Java is opensource, to say that you can use it for free than say “but if you use it on a small device you have to pay” isn’t going to stand up in court. That’s Google’s platform. 

            Here’s my prediciton. Java is crap and Google knows it but using a JVM was the fastest way to get Android out and the fastest way to get apps written since there’s quite a lot of java developers (every school teaches it).  However, once you have market saturation you can change. Google will drag this thing out and in the end drop the JVM and have a native environment for apps and Oracle will have lost their largest competitor. I don’t have any data to back this up but I think this is how it will go. Maybe google will switch to GO as a language and drop Java altogether. I hope they do.

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            1. I question if you do any development as well. 

              ” to say that you can use it for free than say ‘but if you use it on a small device you have to pay’ isn’t going to stand up in court.”
              Actually, it is perfectly legal to take exclusions to GPL for specific applications and these exclusions have consistently stood up perfectly well in court.

              So your prediction is (even with Android’s currently shrinking market share in the US), Google will wait to get market share and kill off Android and obsolete 100% of the applications developers have built.  It will then come out with a new platform based on the dying “Go” language and maintain its dominate market position?

              And then, with Google having 0% market share, they will still be on the hook for the 300+ million Android handsets sold and have to write Oracle a $5,000,000,000 USD check?

              Really?

              Do you work for Nokia?  Is your name Stephen Elop?

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            2. Henry 3 Dogg Sunday, July 10, 2011

              “Obviously you’re not a developer.”

              I’ve been a developer for over 30 years and a director 5 different software companies over the last 20.  I’ve been using Java for about 15 years.

              SInce you say “… some of Sun’s libraries which my Java developer says are horribly written…”, I think that I can reasonably deduce that you are not a java developer.

              I an quite familiar with the Java license terms, which you clearly don’t have a clue about. Being open source does not undermine the validity and applicability of that license. 

              Try distributing phones with Android on, but without Googles location stack and you’ll find that Google feel just the same way.  (ask MMI if you don’t understand)

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            3. I’m not a java developer, I employ people like you but I have a legal department that decides about licenses.

              If you haven’t read it already - http://www.groklaw.net/article.php?story=20101111114933605

              We’ll see how this turns out but I believe my prediction is correct, either Oracle will lose because it seems Google has a strong case and Java will lose it’s chains or Google will just stop using their stuff. Either way Oracle loses. 

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            4. Sure you do. Does your mommy know you are using her computer?

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            5. I doubt you employ anyone like me or could even afford me.  If you are taking legal standing advice from a site as biased as groklaw, that explains why you are so amazingly confused on this matter.  groklaw has a political agenda and many of their write ups are written based off of what they wish were true or but not based in reality.

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            6. You have the gall to say that yet you clearly know nothing about development.

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        3. You are right in the first paragraph but completely wrong in the second.

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      2. How is mobile Java copatible with desktop java? That is the sole reason Android came into existence

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    2. Apple has the fact that it invented a totally new, touch based user interface, and google copied it lock and stock.  Not to mention the rest of “android”.  Before the iPhone was announced, android was a ripoff of the Blackberry. 

      Apple patented its technology, and I hope to see google declare bankruptcy eventually for this theft. 

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      1. While I think Android will go down as Google’s single biggest business mistake, declaring bankruptcy serves no one and especially not the 100′s of millions that use Google’s services.

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    3. You are completely wrong. This situation is not at all like SCO. Read the article again.

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  2. I really do not get why no-one sees the embrace and extend angle here.  Paying for Microsoft a patent licensee fee gives OEMs a license to use other Microsoft technology, like Exchange for example, and may increasingly make the Android used in the real world a combination of Google and Microsoft’s stack.

    Now THAT would really irritate Google.

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    1. What really will irritate Google is when Bing replaces Google search engine in Android.  Google only cares about advertising dollars. 

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      1. Henry_3_Dogg Saturday, July 9, 2011

        And Safari Reader. I haven’t seen an advert in weeks.

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  3. this just shows how greedy microsoft is…. they are realising that windows phone 7 isnt popular so what do they do?…. they go after the opposition just to force everyone to use their shit windows just so bill gates gets his check.

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  4. The problem is that Android uses others patent. Goolge has not innovated anything in regards to Android. They bought Android and Handsprings. Google cloned RIM. Then Google sat in Apples boardroom and saw iPhone. Google cloned the iPhone. This is just fact. Just goolge and find pictures of the Android prototypes. 

    Googles culture is that they don’t care about rights and patents. Just look at youtube and 90% pirated content. Just look at Android phones and that uses use 90% pirated content. (a hint: Android users and iOS uses download average of about 160 apps. Somehow 90% of the app store revenue is in Apples app store)

    Google is so big that they can do what they want. Earlier this year they had to pay 500 million dollar fine. That is 1/10 of Googles profit. They don’t care. 

    But MSFT business genius is shown here. Android copied iPhone. Android makers pay a licensing fee to Microsoft. This is the Microsoft way. 

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    1. Just curious what your relationship to Google is?  How is it you have come to this summary?  Or are you just stating your opinion?  How is it that Google has not innovated “anything” and “copied” everything?

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      1. He said it: “The problem is that Android uses others patent. Goolge has not innovated anything in regards to Android. They bought Android and Handsprings. Google cloned RIM. Then Google sat in Apples boardroom and saw iPhone. Google cloned the iPhone. This is just fact. Just goolge and find pictures of the Android prototypes. “

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      2. Anyone who knows the state of the industry knows that Google copied the entire android design from Apple.  The original android design (When google bought android inc) was a copy of the blackberry.  The design for a touch based UI is an apple invention, and an apple innovation. 

        Its not like there were touch based phones before the iphone.  Apple came up with something new, google stole it. 

        Preventing this is the reason for the existence of patents.  You’re supposed to learn from what others have done, but then come up with something new. 

        Google hasn’t been innovating in the last 10 years at all.

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        1. LG Prada.  By a month or so.

          It lacked the polish and sophistication and multi-touch aspects of the iPhone.

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          1. So funny. Google it because even though LG claimed this it turns out their dates didnt match up.

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            1. The LG Prada surfaced in December of 2006 (it shipped a few months later) and included a non-multi-touch capacitive touch screen interface.  It was clunky and lacked refinement but did beat Apple to market with a finger based touch device.

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      3. Read what he said. It’s a fact that Google bought Android. That at various time Android looked like RIM, then Windows Mobile, then completely changed to look like the iPhone when iPhone was introduced. Google it.
        Android itself is Linux with a JVM and there is ample evidence much of the JVM was taken from Sun.

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    2. @facebook-823844500:disqus 
      YouTube is 90% pirated content?! Wow.. that’s some serious hyperbole bull.I agree that there might be some pirated content on there but 90% is definitely not the figure.

      As for iOS and Android store revenue, if you’ve tried and used Android, you would know that there are a lot more legally free apps there eg: Rovio sells Angry Birds on iOS but gives it away free on Android. Yes, folks install pirated apps on Android.. but so do folks on jailbroken iPhones. Don’t delude yourself.

      Create and innovate are also two distinct actions. Google may not have created all the tools that make up Android.. but they’ve brought them together through innovation to pose a serious contender in the mobile market. Apple didn’t create a lot of the technologies used in the original iPhone but they innovated and improved what was available, and packaged it so brilliantly well. In this day and age, true creations are getting less and less as they become more complex and sophisticated.

      Anyway, I stand on the fence with the whole matter. Microsoft has their business strategy and if that’s how they want to play the game, then that’s their decision.. I just hope that as consumers we don’t suffer in the long run.

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      1. If you had ever used iOS, then you would know the Rovio has both a free and paid version of Angry Birds in the App Store.

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      2. There is no comparison between the amount of pirated apps on Android and iOS. The very idea is laughable.
        Apple did create the software and hardware technologies in the iPhone. Certainly far more than Android. You are just ignorant on this and saying what you would like to believe.

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    3. I would like to see where your 90% pirated apps comes from. I know allot of android and iphone users, and no one I know uses pirated apps. Anyone that knows enough to pirate them, knows enough to stay away from them due to virii and malware. Tossing out fake facts to make it sound like you know what you are talking about, just makes you sound more like you have no clue. 

      I’m not a fanboy either way, and couldn’t care less who comes out on top. But, your fan cape is flying strong in saying Android copied the iPhone. What, because it has a touchscreen? Give some facts to back up your statements please. 

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      1. The 90% matches what developers were talking about 1-2 months back.  All but 2 people I know that use Android pirate the bulk of their premium applications.  Now, these people fall under the category of “horder”.  Do they need 10 system monitor tools?  No.  Did they pay for even 1 of them?  No.

        Is piracy really 90%?  Probably not but it is very high in the Android community.  Gingerbread and HC have started to address this issue but very few phones/tablets actually run on either of those version of the OS.

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        1. There’s no piracy. I don’t know of anyone who uses Android that pirates anything. I do know those same people pirate Desktop software though.

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          1. Tell that to the developers making the non free “premium” games on Android.  They will 100% disagree with you.

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            1. The one person making “premium” non free games for Android. Is Angry birds prated? I don’t think so. I paid for it on Maemo but use it for free (with ads) on Android. Unless pirates are including ads in their pirated software I don’t see it – at all.

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            2. Are you suggesting there is only a single application/game in the entire Android Market catalog that costs more than a penny?  Really?  Are you serious.

              Or do you think that Angry Birds is the only game in existence for Android?

              Dude.  This is great.

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            3. The iOS games market is multiple orders of magnitude above Android in numbers, quality, and selection.

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      2. They don’t need pirated apps, they’re mostly free. I’ve had an Android device for 6 months, have never paid for an app and only get them from the official appstore.

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      3. The fact of the matter is, that the multi-touch UI is an invention of Apple.  Proir to the iPhone there was no multi-touch UI.  That is a genuine invention, it is genuinely innovative.  Before the iPhone was announced, google was working on phones that looked like Blackberries. 

        You claim to be impartial, but you call people who point out this fact of history “Fanboys”.  Well, I think it is because you can’t construct an argument… after all, if you can’t defend your point you attack the person by calling them a fanboy.

        google should become a subsidiary of Apple, they have committed a massive crime here.

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        1. Get your facts straight Jessica. There were quite a few touchscreen phones before the iPhone. LIke the Nokia 7710 http://en.wikipedia.org/wiki/Nokia_7710  

          I can construct an argument, and back it up. If you had even done a simple tiny search, you would see you are wrong. Have a great evening. 

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          1. Read it again. Multi-touch.

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          2. The Nokia 77710?  That’s your argument?  Weak…  Extremely Weak.

            Show me one phone, or any device for that matter that worked like an iPhone prior to it’s launch (July, 2007 I believe.  Show me one where you pinched on a web page to zoom in.  Just one.  Now look post iPhone and how many do you see?  All of them.

            Apple OWNS the multi touch mobile device patent.  Everyone else is going to pay them and pay them BIG.  It’s time to pay the piper…AND NO ONE IS LOOKING FOR YOUR APPROVAL OF IT.

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          3. You need to get your facts straight Taubin.  The Nokia 7710 was not a multi-touch based phone in any way shape or form.

            I can construct an an argument, and back it up, just by reading what the OP wrote and comparing it to your sample.  The Nokia did not match what Jessica said even remotely.  Had you done some basic reading you would have seen you were wrong.

            Have a great evening.

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          4. Oh, the famous Nokia 7710, how could anyone forget THAT?   LOL!   

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      4. Then you don’t know many Android users.

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    4. I like how you make up reason how Google copied everyone then back it up by stating “This is just fact.”

      How is it that Google only copies when they consistently release the most innovative features. And how is it that the iPhone 4 and iOS 5 are pretty much recaps of the best features of android the year prior? While android moves into 3D screens, home automation, and USB hosts, Apple is still trying to implement core functionality like a notification system that actually works, or even multitasking.

      And touch screen phones existed long before the iPhone, and are still made after the iPhone, so you can’t really say anyone is copying Apple just by making a touch screen phone. Because Apple wasn’t the first.

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      1. I love how fandroids make the claim that Apple is copying google, and you even go so far as to claim that “touch screen phones existed long before the iPhone”.  When you have to lie so blatently as that, you really must know yourself that you’re a scumbag. 

        Before the iPhone was announced, android was a ripoff of the blackberry.  Android is a ripoff of the iphone, it violates apple’s legitimate patents.

        Google doesn’t innovate, at least in the phone space, they just copy.   They might come up with a few features ahead of Apple, but that’s easy when you don’t have to spend any money doing any fundamental R&D because Apple did it for them. 

        If there’s justice, Apple will end up owning google in the settlement for this. 

        You, as someone who wants something for nothing, are now lying about reality (multitasking was in the very first iphone… everyone whose said differently is either dishonest or too ignorant to comment on the issue) because deep down you know android is a ripoff.   This shows yourself to be lacking in character.

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      2. Since Android is only copying iPhone anyway, it’s pretty simple to then just do one little geeky feature and have the fandoids think, “Wow, innovative” when you all just take the iPhone you wholesale copied and run with it.   Not having to figure out how to do anything, and having uncritical fanboys who will love anthing so long as there is no ‘evil’ apple logo on it frees one to futz around with something stupid and trivial like ‘home automation’.   As if, iPhone doesn’t have these capabilities.   You are dreaming.  

        But, don’t sweat the details…   Android is where the real ‘idea guys’ live, right?   LOL

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    5. “They bought Android and Handsprings.”

      No, they did not buy Handspring.

      “This is just fact.

      No, I believe it’s libel. Or possibly slander. I keep getting those mixed up.

      “Just look at youtube and 90% pirated content.”

      And your proof of this is… what, exactly?

      “Just look at Android phones and that uses use 90% pirated content.”

      And your proof of this is… what, exactly?”Android users and iOS uses download average of about 160 apps. Somehow 90% of the app store revenue is in Apples app store”

      And your proof of this is… what, exactly?

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      1. Android phones prior to the iphone announcement were ripoffs of the blackberry.  Suddenly, after the iPhone is announced, we’re supposed to believe google spent 10 years developing a touch UI like Apple did?  No, they just copied it.  Since Apple patented their inventions, google is liable…and should be.

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    6. ‘Google cloned the iPhone’ – Google does not build the equipment and btw iPhone was out much before android prototypes started rolling out. Pirated content on Youtube is not uploaded by Google. Also the videos are removed if there is complaint made regarding pirated content. Regarding App store revenues, don’t confuse yourself between free apps and pirated apps.

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  5. I don’t understand why Sony was part of the consortium that bought the patents.  Weren’t they partners in the development of Android in the first place?

    I really don’t understand how “copying” can be such a BIG deal about some things, but not others.  Did Honda sue Toyota for copying them?  Has Barnes and Noble sued Books A Million?  RiteAid sued Walgreens?  Nike sued Reebok?  Sony sued HP??  Surely something that someone else does can ALWAYS be looked at as copying someone else.  Maybe I could patent AIR and sue all the f-ers who breathe it?!!!?!?!  The person who is hurt by all of it is the consumer.  Who pays that $15 licensing fee??  Not really Samsung.  The price will be tacked onto the price of the phone in the end somehow.  It’s like the convenience fee you have to pay when buying freaking concert tickets.  What would be awesome is if the consumer banded together and just flat out STOPPED buying.

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    1. There were no multi-touch phones until the iPhone.  Android copying that is not just making another car, it is  letting Apple do the hard work of invention while google seeks to profit from it. Apple didn’t have to reveal the nature of their invention, the techniques they use to precisely detect user intent.

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    2. Google allows no contribution o the Android Source from Sony or anyone else. Which is one of many reasons why android is not actually open source.

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  6. The US patent situation is in a truly deplorable state.  What isn’t mentioned is who the situation is worst for: Startups.  I’ve spoken with numerous entrepreneurs in the “speech recognition” space.  They will tell you that Nuance Communication’s legal conduct is more unscrupulous than the Church of Scientology’s.  These groups are sabotaging US industry and stagnating US innovation.

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  7. ——-  found its answer to critics fond of the “one-trick pony” slur with Android, ———–
    you do realize that Google doesn’t make any money with Android?  and of the advertising profits it does make,  it pays that out and more to patent holders like Microsoft and Oracle….

    implying that somehow Android was a new pony shows very little knowledge of what truly is going on,  simply looking at the stock price since 2008 will let you know what really is going on with what pony’s matter.

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    1. actually, google keeps their advertising money. the eom is the one that will fork out the fees. greedy google cant defend android infringement.

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  8. Henry_3_Dogg Saturday, July 9, 2011

    Google is still a one trick pony.

    UTube has lots of viewers

    Google maps has lots of followers

    Android is on lots of phones

    But none of these has produced a return on investment.

    The only way Google makes money is by selling advertising.

    It’s a One Trick Pony

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    1. You using those services?  I bet you are, so what is your point?  How does NBC, CBS, ABC, FOX, and Lifetime freaking TV make money?  Same way.  So is “One Trick Pony” and slur or a compliment?  They sure can offer a lot of services for a One Trick Pony.

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      1. Michael Haughton Sunday, July 10, 2011

        The TV companies most likely make more money from licensing there shows overseas as well as selling the show’s syndication rights to other stations e.g. cable stations

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    2. And very very successful at it. What’s the problem with that? The only reason they created Android and Chrome was so they’d have more eyes on search. 

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  9. android is so dead 
    fractured OS across way too many types of hardware
    they arent defending Lodsys S&D sent to their developers, why waste time building crap apps ?
    faced with multiple patent lawsuits they will have either disable features or pay out the nose
    not owning this IProperty they will be so beholden to the other major players
    the shotgun approach failed for MS and it will fail for Google 

    Android is the 1980 Ford Pinto of the Mobile World 

    and BTW if Google is “so open” why dont they release their search algorithms ?

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    1. android is so dead.

      umm… hahahahahahhaahhaahahahhahahahhaahhhhaaaahaha!
      You just made my day.
      The Ford Pinto of the Mobile World?
      hrahrhrhahaahahahahahahahhahaha… 
      Well, my whole week.
      Wait. Let me guess… you belong to that group that predicted the end of the world recently, right?

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    2. Android is dead with the majority of new smart phone sales and going up rapidly.  Apple lost because they insist on making all of their hardware (just like the 80s) and controlling the content (just like the 80s). Windows won because they did neither of these things. Android is the new Windows for mobile devices. Apple didn’t learn the last time. Microsoft is the old IBM who was too big and slow to innovate and had no vision.

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      1. If the word “lost” means Apple walking away with a >55% profit share of all mobile handset profits world wide on all handset types…

        I think Apple enjoys losing.

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        1. Currently. In the 80s it was the same story but you can’t keep making money when your marketshare is going down. This is the lesson they should have learned before but didn’t. Microsoft eventually dominated the Desktop market, not because they were better but because their platform became ubiquitous. Apple in the early 80s was a much larger company than Microsoft and they had a lot of ground breaking products but they thought that being cute and having fans was enough, they were wrong. Apple is in the exact same position now and they have the exact same attitude.  Their marketshare is going down for exactly the same reason and their competitor is doing exactly the same thing. They are making money but I think in a year or two they’ll be at their absolute peak unless they realize marketshare is more important than making more money per person.

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          1. Except you said: “Apple lost because they insist on making all of their hardware (just like the 80s)”.  Not “will lose”.  You clearly said “lost” as in past tense.

            Given last quarter, Android’s US market share (where it is highest) showed a decline while Apple’s showed a gain, I think saying Apple “lost” is very premature.  So Apple’s US and World market share of handsets is rising (as is Android’s world wide and dropping in the US).  Apple’s sales share is increasing (as is Android’s).  Apple profit share is rising while Android’s is falling.

            So again, how dose this equte to “lost”?

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          2. Henry_3_Dogg Saturday, July 9, 2011

            You can’t make much money giving your product away either.

            Microsoft never had to give windows away to compete.

            IOS overall share of mobile devices is just fine

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            1. You don’t understand Google’s business model. They don’t care about the devices. The ONLY reason they made Android and Chrome is to increase eyes on their product. They have no intention of ever making a dime on the devices. Apple is slowly coming to this and it may save them. They’ve sold 15 billion apps on the appstore and itunes has been a roaring success. At some point they’re going to say “You know, we should be giving away the OS to anyone who wants it so we can increase our marketshare for our services”. When they get to this point I’ll change my prediction but for now it stays. IOS markeshare is fine currently but the business model is inferior and they will lose if they stick to it.

              Just for the record I’m not a fanboy for Android and I find the experience poor. However, I’m a great businessman and Google’s way will win. I just hope at some point the product gets better.

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            2. You really are a bit off from a business side and don’t seem to understand money or economics or technology or business.  Apple is raking in >55% of the profits in the mobile handset industry worldwide.  This includes dumb phones, feature phones and smart phones?

              Think about that value.  >55%.  Not only that, they are growing their market share while maintaining a quality product and avoid price erosion.  With the exception of HTC, their competition is floundering.

              “You know, we should be giving away the OS to anyone who wants it so we can increase our marketshare for our services”

              Lets see, they run the AppStore at a 1%-3% gross margin or so.  1 in every 4 applications downloaded actually COSTS Apple money to curate, host and serve.  90% of the revenue collected on iTMS goes to the labels and Apple gets the remaining 10% to pay for iTunes development and hosting.  Their iCloud costs no money.  iAd is a disaster and is the only other real source of revenue.

              Likewise, your recipe is a clear path to disaster.  People that are passionate about hardware should do their own [software]-edit-. Systems is a much more difficult discipline than either just software or just hardware but Apple has demonstrated an exceptional gift for Systems work.

              “IOS markeshare is fine currently but the business model is inferior and they will lose if they stick to it.”

              The Apple business model is genius but it takes a company with passion for what they do to pull it off.  Apple’s path to success is, by far, the hardest path to success but also includes the greatest payoffs.  By far.  At this point, all of the senior leadership has this passion even without Steve Jobs at the helm.  When Apple looses sight of their reason to exist (and they will someday), the company will stumble really bad.

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            3. Henry 3 Dogg Sunday, July 10, 2011

              I understand Google’s business model just fine thank you.  I understand that it’s a one trick pony that makes its money on advertising and does everything else it does in order to control how many eyes see those adverts.

              I also know that Apple take over 50% of the profit made in the mobile phone industry,  and that iOS across all mobile devices,  not just phones, despite being a premium margin product, is still holding its own against the rapidly disintegrating Google give away.

              I also see what apps, and a lack of flash, and now the safari reader are doing to Google’s control over the advertising market and I fully realise why they are so scared.

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            4. First you were a developer now you are a great businessman. Amusing to hear since you obviously have no idea what you are talking about.

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          3. Apple was not larger than Microsoft in the 80s and their marketshare is going up. Do you just make these things up?
            Markets are is not everything. Profit is far more important. Ask any company which they prefer.

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            1. They were absolutely larger than Microsoft in the early 80s.
              “On December 12, 1980, Apple launched the Initial Public Offering of its stock to the investing public. When Apple went public, it generated more capital than any IPO since Ford Motor Company in 1956 (as claimed in two books [1] and ICon: Steve Jobs) and instantly created more millionaires (about 300) than any company in history. Several venture capitalists cashed out, reaping billions in long-term capital gains.” I get tired of talking to snotty nosed little kids who wasn’t in the computer industry when all of this was happening. At least google it first. Check Apples IP address range. They were 7th in line for IPs. SEVENTH! Microsoft at that time was three guys working on the BASIC language. 

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  10. This is a mighty excellent article about the current state of Google and Android. I found it evenhanded and concise, plus its steers clear of the usual Google cheerleading claptrap one finds in the tech community blogs. (OT, is it just me or does anyone else think the International Business Times technology section is to Google, what FoxNews is to Republicans?)

    It’s actually sad to witness how Google has mishandled Android. I think it’s a very good mobile OS, but Google took this approach where they basically absolved all responsibility for it and so, even though it’s pretty damn good, it’s become a cluster f*ck of malware, fragmentation, and lawsuits.

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