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Patent Wars Could Dull Tech's Cutting Edge

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Patent Wars Could Dull Tech's Cutting Edge


Patent Wars Could Dull Tech's Cutting Edge

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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Among techies, 2011 is being dubbed the year of the patent wars. Major players like Apple, Google and Microsoft are spending billions of dollars buying thousands of patents. Most recently, Google spent 12-and-a-half billion dollars to buy a cell phone company and its 17,000 patents.

To learn more, we reached NPR's Laura Sydell, who's been reporting on the patent wars.

Good morning.

LAURA SYDELL: Good morning.

MONTAGNE: Laura, start by giving us an example of a single battle, one patent that's being fought over.

SYDELL: Okay. Well, let's take Apple suing the company HTC, which is a Taiwanese cell phone maker that makes Android cell phones, uses the Android operating system. So Apple is suing HTC and has won the first round, though it's going to be appealed. But here's what the patent is for. You know when you get an email on your cell phone and you see, say, a phone number, or a link to something and it's underlined and you press it and it goes to a map or it says do you want to call that phone number?


SYDELL: Apple says we have a patent on that. They say that Android phones -which, in fact, do the same thing - are violating their patent. You should understand, though - and this is what gets so weird about these patent wars -is that this is a patent from 1995.

MONTAGNE: And - cell phones?

(Soundbite of laughter)

SYDELL: There were barely any cell phones. You know, there certainly weren't smartphones, but there were barely cell phones in 1995. So a lot of people say what's really going on is this is about trying to stop your competitor from competing with you.

You grab this big, broad patent and you use it to sue your competitor.

MONTAGNE: So that is basically what these companies have to gain.


MONTAGNE: A leg up...

SYDELL: A leg up...

MONTAGNE: Or more than a leg up.

SYDELL: Now, what happens is that, say, a company like Google - which, of course, created the Android system - didn't have a lot of patents. That is one of the major reasons they are buying a company called Motorola Mobility, which makes cell phones, but also has a portfolio of some 17,000 patents, and then another few thousand patent applications in the works.

Google probably hasn't a clue what is really in that big trove of patents, but they figure there must be something in there that's probably overly broad and that they can use to try and sue, say, Apple back.

It's kind of like the Cold War, right?

(Soundbite of laughter)

SYDELL: It says, you know, well, I've got this in my stockpile. And they say, all right, let's have a cross-licensing agreement, and then they stop the lawsuits.

I should say, Renee, that a lot of people think this is a terrible waste.

MONTAGNE: A terrible waste of energy, money, whatnot. I mean, I'm looking at a graphic.

SYDELL: Everything.

(Soundbite of laughter)

MONTAGNE: I'm looking at a graphic of the patent suits, and it's like a plate of spaghetti.


MONTAGNE: Every arrow is going in all directions. All the big companies seem to be involved.

SYDELL: Yeah. I mean, all right, so look. So Google spends 12-and-a-half billion dollars, right, to buy this company. That's 12-and-a-half billion dollars that basically didn't go into making new products. It didn't go into hiring anybody, and it will probably show its head maybe when you go to buy the Android phone and the price goes up.

(Soundbite of laughter)

MONTAGNE: So it does affect consumers.

SYDELL: It does affect more than just these big companies. So you, as a consumer, first off, may pay more. Secondly, it may slow down innovation. There are a variety of ways in which this is also being used to stop the next cool thing from happening, because you can just try and sue not only a big company, but maybe a small company that's coming in to compete in your market with some new, cool idea. And yes, so this will affect you and me.

MONTAGNE: Is there some way for a peace treaty to be signed in these patent wars?

SYDELL: I don't think so. From my understanding, Google didn't have any patents, because they really didn't actually want to play in this war. But I think that any big company now really has no choice, because you come along and you essentially will end up getting sued. So I think what we are likely to see in the next few years is even more of this, a lot more buying up of patent portfolios.

So, for example, you may see some people try to bid on Kodak, which has a huge, valuable patent portfolio. Some say that Kodak's patent portfolio is even more valuable than Kodak itself. And so no, I think this is going to be going on for a while.

MONTAGNE: Laura, thanks very much.

SYDELL: You're welcome.

MONTAGNE: Laura Sydell is NPR's Digital Culture Correspondent. And you can hear more of her reporting on the players in the patent wars, including one group of people called Patent Trolls, on

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