[spiralpolitik]

FRAND patents of the like Samsung are complaining about are usually patents on the individual component chip. Manufacturer of said chipset license the patent when they make the chipset then sell the chipset to downstream integrators like Apple. Given the cost of the chipset is far cheaper than the overall cost of the device 1c per chip is reasonable, especially when said chipset may require the licensing of hundreds of other patents as well and devices requiring several chipsets. If Samsung wins here they will effectively kill FRAND licensing and costs will increase significantly as everybody will now want $25 per device for their patents.

As part of the standards process Samsung has committed to licensing these patterns under Fair, Reasonably and Non-Discrimartory terms, which means they can't ask Apple for a different rate than they give say Motorola or HTC. Because Apple's Design patents are not FRAND they are under no obligation to give anything to Samsung.

Because Samsung's patents are standards essential you can't build a cellphone without needing them (hence the FRAND licensing), while its certainly possible to build a cellphone that doesn't violate Apple's design patents (RIM, Nokia et al don't seem to be getting sued for example). This doesn't mean that Apple is right for suing companies for violating them, but what Samsung is doing is far far worse.

[justinschuh]

I'm sorry, but I'm tired of seeing this blatantly disingenuous argument parroted everywhere. The fact is that Apple started this mess by ignoring FRAND obligations entirely--standards that make the entire iOS ecosystem possible. Now, I'm totay fine if Apple wants to make the argument that the existing patent system is unreasonable. But what Apple did instead is pure, self-serving hypocrisy.

Apple launched into a rampage trying to sue every other viable competitor out of the market for supposed infringement. In defending themselves from these attacks, Apple's victims are responding aggressively with their FRAND patents and whatever else they have (and even then, they're asking for a tiny fraction of what Apple is). Put simply, if you engage in the kind of anti-competitive and bullying behavior that Apple does, and subsidize your own profit margins on the backs of everyone else, then you shouldn't be surprised when everyone else starts swinging back.

[gareim]

Can you explain how Apple ignored FRAND obligations entirely?

Qualcomm already licensed the patents in its chips that they sold to Apple, but then Samsung wanted more because it was Apple. That itself is violating the "non-discriminatory" part of FRAND. How is this Apple's fault?

[justinschuh]

This kind of misinformation is the problem. Qualcomm never had a license for Samsung's FRAND patents. If they did, there wouldn't be an issue here. What Qualcomm had was a contractual agreement protecting their customers from Samsung pursuing FRAND patent fees, but that contract expired in early 2011. So, now Samsung is using their FRAND patents in defense against Apple's thermonuclear patent war.

[gareim]

Can you provide a source for that? If this is true, that changes quite a lot.

Also, how do you feel about Samsung asking for 2.4% of the chip price for a single patent when there are so, so many patents that go into making a device like the iPhone? Is that fair?

Edit: Forget about the source, I found some very easily (Google "samsung frand qualcomm"). But still, I think it's quite discriminatory to demand from Apple 2.4% for each patent, especially when these patents are seen as standards for cellphones.

[justinschuh]

Let's try that question the other way. Is it fair that Apple is trying to extort $27 per device out of Samsung (many times more than Samsung is asking for on its FRAND patents)? While we're at it, is it fair that non-iPhone users in the US subsidize Apple's huge profit margins? Because, Apple demands such a high subsidy (and competitive pricing on-contract) that the carriers make the difference up on other customers. So, is it fair that I'm forced to pay higher rates on my plan because Apple is intentionally leveraging their size to distort the market?

[josephlord]

Fair, I don't know if the patent is valid Samsung could just work around it. If Apple have a valid patent as I understand it they can license it for any price that they want OR completely refuse to license it provided they haven't made any agreements or commitments to the contrary.

That is the normal case with patents, exclusive rights. When you step into a standards body and offer your technology you give up those rights unless you specifically and clearly declare that you aren't doing so (in which case other options will be chosen by the standards body).

So there are other ways to look at it. Is it fair that Samsung pushed it's technology into a standard and then holds other implementers to ransom or asks them to give up their legal rights to enter the market?

As I say elsewhere I'm not picking sides on the validity of particular patents or what damages or even FRAND license fees should be but I do think it is important that FRAND commitments are given weight and enforced.

For me forced cross licenses and percentages of finished product price are both discriminatory and not FRAND. Even percentage of chip price I have my doubts about as it discourages integration of chips with its hardware and power advantages. This doesn't mean that it must be less than 1c or even $1 but some mechanism to be fair to all patent holders while not pricing the standard out of use needs to be found.

[briandear]

Non-US iPhone users aren't subsidizing anything. While the carriers in the US do subsidize phones, carriers don't just absorb that cost, it gets passed along to the end user. These arguments are kind of similar to those presented by people wanting higher corporate taxes without realizing that those costs are ultimately paid by the consumer.

[gareim]

It is absolutely fair. Apple's patents aren't FRAND and so they can ask for whatever they want to ask for and Samsung has the option to either use it or not. It's not that simple when it comes to FRAND patents because the whole point of FRAND patents is to ensure that everyone uses it so that fragmentation doesn't occur in necessary standards. 2.4% for a single patent when there are potentially hundreds of patents is ridiculous. There's no way you can argue against that. How many patents go into making a phone? Samsung wants 2.4% for each one.

And yes, it's absolutely fair (about the subsidizing). That's how the market voted and that's how the carriers decided to do business. Majority rules here. If you don't like it, then vote with your wallet. Go to T-Mobile.

As a sidenote, I'm currently using a Samsung Galaxy S III on T-Mobile. But I still think what Samsung is doing with FRAND patents is wrong.

[spiralpolitik]

The agreement didn't just expire, Samsung terminated it with the express purpose of counter-suing Apple. Note that Samsung to date has not gone after any other Qualcomm customers for increased patent license fees they can hardly claim they are being non-discriminatory.

Not sticking to the FRAND terms it agreed to is a pretty bad move on Samsung's part. I believe the EU not happy about this development and is already looking into this so the move could blow up in Samsung's face.

[makomk]

Also, as I recall Apple moved to Qualcomm chips from another chipset provider after they got sued by I think Motorola because neither they nor the chipset provider had come to any kind of licensing or contractual deal over the FRAND patents.

[patrickaljord]

So if Samsung builds ground breaking technology that is so important that it gets included in every smartphone, they can't charge more than 1c per chip. However, if Apple builds trivial "slide to unlock", they can charge $25 per phone and block devices from entering the market? What is the incentive of doing research and developing important wireless technologies if you'll be less rewarded than the company who developed "slide to unlock". Shouldn't important techs get the most rewards? I'm against software patents, but if the law's going to support them at least it should be coherent.

[josephlord]

If Apple charge $25 for a patent that isn't worth that much then people won't licence it and will find alternatives. If Samsung charges a high rate for one patent (of hundreds) people have to either completely drop the standard or pay.

I don't know if the Samsung patents are groundbreaking or not. It could be that there were other similar options the standards committee could have selected but with Samsung in the room the choice with the Samsung patent was made so all implementers need a license.

Big companies often want to get their technology into the standard as that enables them to get a small per unit license fee across large numbers of devices. I know that was the case when I worked at Sony. If Samsung didn't want to make that patent FRAND they could have made it clear during standardisation and I'm sure it would have been left out. If patents in this area don't get into standards they are effectively worthless.

Remember that the a group of competitors sitting in a room discussing future terms of business is either a standards committee or an illegal cartel. The difference is the rules under which they operate to give others access to the market which include the FRAND commitments.

[Peaker]

The problem is a patent may be worth so much because it is so trivial that doing anything else is silly.

Apple should never have been granted a patent for slide-to-unlock, that's a trivial consequence of using a touchscreen UI.

[josephlord]

I'm not sure that really is the case. Nokia, Sony Ericcson, Palm and MS had touchscreen handhelds for years before the iPhone. Either that should have generated clear prior art or there are other options that aren't silly. If Apple came up with something new that really makes all the old ways seem silly maybe it really is a valuable technology that they can charge high prices for.

If the Apple patent is shown to be invalid they won't get anything and Samsung won't have to work around it but whatever the situation there is no value in comparing prices between FRAND and non FRAND patents.

I don't recall any of the tech giants including Google and Samsung campaigning to get rid of whole categories of patents of for other major reforms. I would like patent reform but The law as it exists should be enforced.

Edit: Note that in this and my earlier post I am not commenting on the validity of either sides patents or what exactly the damages or license fees for either should be BUT that there is little value making a comparison between FRAND committed prices and those for any non FRAND prices.

[Peaker]

> Nokia, Sony Ericcson, Palm and MS had touchscreen handhelds for years before the iPhone

They had enough physical buttons to make button unlock a viable option.

When you have only a touchscreen, the gestures available to you are taps and swipes. Taps easily happen accidentally, so some composition of swipes to unlock is the main obvious remaining option.

[josephlord]

If that is the case anyone can work around the patent for the cost of a hardware button.

Those saying this is a major critical feature (I'm not)that reduces hardware costs and improves product design are really making the case that it is a good patent, novel and useful.

[gareim]

FRAND patents are going to be more widely used and seen as more "essential". Slide to unlock is not exactly "essential" and more of an option. It's more optional than a FRAND patent would be.