Today Microsoft and Motorola are meeting in courts over royalty fees for 802.11 wireless and H.264 video patents. Microsoft is claiming that Motorola is asking for too much for the use of these technologies - 2.25% of every product sold that uses it, which includes Xbox 360 and Windows. Microsoft thinks $0.05 a product would be more reasonable.
Since these patents are standards-essential, Motorola has to license them out, though the definition of what's a fair amount to charge is clearly up for debate. The first part of the trial will have Motorola and Microsoft arguing over what the royalty rate should be, for which the judge making the final call. The second part will haul in a jury, which will decide if Motorola was breaking its existing contract with Microsoft by overcharging.
Motorola's acquisition was largely a defensive patent play, but it also meant that Google would inherit existing patent cases and open them up to future complaints. Things could backfire if Microsoft wins the case and sets a precedent for other licensors, but likewise, Motorola could cement their current rate. 802.11 and M.264 are some pretty big patents to hold, so no doubt Google will be dealing with cases like this for a long time yet.
Anyone taking bets on who will win this case?
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