Things are looking a little rough for Android right now. Its increased popularity is not only attracting millions of new fans but is also attracting unwanted patent attention from competitors unhappy with its success.
Earlier this week Apple won a significant patent claim against HTC, one of the main proponents of Google’s Android OS. The win, over two software-related patents, positions Apple to go after other handset makers that use similar technologies. Apple already has pending cases against Samsung and Motorola, both heavy Android users.
This preliminary ruling is an important win for Apple as it looks likely that almost all Android devices will infringe on the two patents, filed in 1994 and 1996. If this is the case then Apple’s suits against Samsung and Motorola would be significantly strengthened.
Although the real focus of attention for Apple is actually Android, the strategy is not to go after Android (and therefore Google) directly but to make life difficult for smartphone makers, and discourage them from producing Android-based devices.
Globally Android is racing ahead of Apple’s iOS in market share with Gartner estimating that Android now holds 38% market share and Apple’s iOS 16%. HTC and Samsung in particular have focused much of their energy on the Android market over the past couple of years and played a significant part in Android’s success to date. Now it could earn them ever increasing amounts of negative attention from Apple and other software makers.
Microsoft’s Android windfall
In HTC’s case this is already happening with HTC reportedly paying Microsoft $5 for each Android phone it sells. Although HTC hasn’t publicly admitted to this, all evidence suggests that this is true. The agreement goes back to April 2010 when HTC and Microsoft “signed a patent agreement that provides broad coverage under Microsoft’s patent portfolio for HTC’s mobile phones running the Android mobile platform. Under the terms of the agreement, Microsoft will receive royalties from HTC.”
Ironically this means that Microsoft is probably making more money from Android’s success than it is from selling its own Windows Phone 7-based devices. Estimates of Windows Phone 7 sales range between 2 and 4 million devices to date. Compare that with Android which has more than 500,000 devices activated daily. At $5 each, that’s $2.5 million for Microsoft’s coffers each day.
Users seem largely unconcerned by the patent wars going on behind the scenes in the smartphone market, even though at least one survey suggests that US users have a preference for Apple’s iOS over Android. The reality is that Android is now available in so many different devices that it is far easier for consumers to buy an Android phone than it is to buy an iPhone. Also, Android is shipping on high-end smartphones, entry-level smartphones and tablet PCs and so covers most of the mobile device market.
The remainder of 2011 is sure to see an increasing number of patent battles in the smartphone market as all the big players fight for their niche.