Microsoft and Google intensified their animosity in a war of words related to mobile patents, even as new data suggests Microsoft's smartphone share continues to fall.
Microsoft's competition with Google proved the highlight of
the week, as a series of Tweets and blog postings by the respective companies'
executives threatened to make an already-tense relationship even more
The stage was set earlier this year, when Microsoft and a
handful of other companies submitted a winning $4.5 billion bid for the 6,000
wireless technology patents and patent applications formerly owned by Nortel Networks. Google had previously offered some $900
million for the patents. In July, U.S. Bankruptcy Judge Kevin Gross, in
Wilmington, Del., and Ontario Superior Court Judge Geoffrey Morawetz signaled
of the deal in a joint session
According to unnamed sources speaking to The
Wall Street Journal
, federal regulators are examining whether members of
the winning consortium are planning to file additional patent-infringement
suits against Android device-makers: "The Justice Department wants to know
whether it intends to use [the patents] defensively to deter patent lawsuits
against its members, or offensively against
But now Google's crying foul over the deal.
"Microsoft and Apple have always been at each other's
throats, so when they get into bed together you have to start wondering what's
going on," David Drummond, Google's senior vice president and chief legal
officer, wrote in an Aug. 3 posting on The
Official Google Blog
. "Fortunately, the law frowns on the accumulation of
dubious patents for anti-competitive means-which means these deals are likely
to draw regulatory scrutiny, and this patent bubble will pop."
He went on to claim that the Justice Department is "looking
into whether Microsoft and Apple acquired the Nortel patents for
Google's competitors have taken to the courts to stop
Android's rise. Over the past several months, Microsoft has convinced several
manufacturers to pay it royalties on their Android-based devices, and is
currently locked in patent-infringement lawsuits with Motorola and Barnes &
Noble. Meanwhile, Apple is embroiled in court cases with HTC, Samsung and
Motorola over the use of Android technology.
Following Drummond's blog post, Microsoft decided to take
the battle to the Internets.
"Google says we bought Novell patents to keep them from
Google," Brad Smith, Microsoft's general counsel, wrote in an Aug. 3 Tweet
. "Really? We asked them
to bid jointly with us. They said no."
The same day, Frank Shaw, Microsoft's corporate vice
president of corporate communications (say that three times fast), also
: "Free advice for David Drummond - next time check with Kent Walker
before you blog."
He included a link to an Oct. 28 email sent to Brad Smith by
Kent Walker, Google's general counsel, suggesting that "a joint bid wouldn't be
advisable for us on this one."
Drummond felt compelled to update his post Aug. 4: "If you
think about it, it's obvious why we turned down Microsoft's offer," he wrote. A
joint acquisition of the patents "that gave all parties a license would have
eliminated any protection these patents could offer to Android against attacks
from Microsoft and its bidding partners."
However the legal side of that patent battle turns out, the
two companies will continue to batter each other for smartphone market share-although Google Android continues to
handily outpace Microsoft's own efforts in the space. According to research
firm comScore, Microsoft saw its smartphone market-share decline in the
three-month period ending in June, from 7.5 percent to 5.8 percent, over a
period when both arch-rivals Google and Apple experienced gains.
Microsoft's market share
included both its antiquated Windows Mobile platform and the newer Windows
Phone, which was supposed to reinvigorate the company's fortunes in the
Instead, Windows Phone is showing signs of anemic adoption
by consumers and businesses. According to data from Nielsen, Microsoft occupied
some 9 percent of the U.S. smartphone market in June-trailing Google Android
with 39 percent, Apple's iPhone with 28 percent, and RIM with 20 percent.
During a July 11 keynote speech at the company's Worldwide
Partner Conference, CEO Steve Ballmer described Windows Phone's market share as "very small," but insisted that other
metrics (such as consumer satisfaction) boded well for the platform overall.
Meanwhile, former Microsoft executive Steven VanRoekel has
been tapped to become the nation's second federal
CIO. He will replace Vivek Kundra, who accepted a fellowship at Harvard
VanRoekel worked at Microsoft for 15
years, eventually rising to senior director for the Windows Server and Tools
Division. After leaving the company in 2009, he served as the Federal
Communications Commission's managing director before leaping to USAID in 2011.
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