Round and round it goes, where it stops, not even [Insert your favorite deity or none at all] knows!
The royalty base is an issue that is being disputed. The established way to do this is to base it on the smallest saleable unit which infringes those patents. In a smartphone, that would be the cost of the baseband chip.
This theory that higher-priced devices subsidise cheaper devices is something I've never heard before.
Right, and it makes sense, but it's a relatively new legal concept as applied to these particular patents.
Yet that is exactly how ETSI FRAND patents have been licensed for the past two decades. Knowing this is key to understanding the background of the cases.
In that way, Apple is not being treated any differently than other licensees.
On the contrary, it's Apple who WANTS to be treated differently. They do not want to pay per price like everyone else has for years. They do not want to play by the rules. They want to change the rules so they make more profit.
This is totally understandable, but it does not make them the victim.
Yet that is exactly how ETSI FRAND patents have been licensed for the past two decades. Knowing this is key to understanding the background of the cases.
The key distinction being that the patents cross-licensed are typically all SEP patents. Samsung demanded that Apple cross-license Apple's own distinguishing patents with them. Apple rightly refused.
Samsung cannot then refuse to license SEP patents to Apple, because that is not what SEP and FRAND terms are all about. Apple asks for a reasonable, non-discriminatory rate. Samsung refuses. Samsung asks for an import ban and somehow gets it.
No, the 2.5% of retail is not reasonable because it is totally out of line with everything else.
And your idea that high-end is supposed to subsidize the low end is a little out of whack. What if the low end is barely a phone and the high-end is a computer with a phone function? It's like saying, "hey, I have this patent on bath drains, I think I will get every swimming pool maker to pay 2% of the retail cost of their swimming pools."
(A contributor must be) prepared to grant irrevocable licences on fair, reasonable and non-discriminatory terms and conditions under such IPR to at least the following extent:
● MANUFACTURE, including the right to make or have made customized components and sub-systems to the licensee's own design for use in MANUFACTURE;
● sell, lease, or otherwise dispose of EQUIPMENT so MANUFACTURED;
● repair, use, or operate EQUIPMENT; and
● use METHODS.
The above undertaking may be made subject to the condition that those who seek licences agree to reciprocate.
- ETSI IPR Policy
Ah yes, thank you
But my guess is that the cheaper iPad 2 will be replaced with the iPad 3 or 4 once the iPad 5 comes out. Kind of like what Apple did with the iPhone 3GS, and what they will do with the iPhone 4 when the iPhone 5S comes out. So really, none of these products will be for sale by Apple by the time this takes affect.
Apple had the right to refuse, but that also means they'll have to pay more than an entity that cross-licenses.
For example, when Apple settled with Nokia, they reportedly cross-licensed some IP to get lower rates.
Apple asked for a rate without cross-licensing, then failed to enter into any arbitration or negotiation as ETSI rules suggest. So they got banned.
Not in the ETSI world. Please see the chart I posted.
It's not my idea. It's the way it's been done for over two decades.
Heck, before ETSI stepped in, back when Motorola owned more than half the GSM patents, they only had two license methods. Either you bought their hardware, or you cross-licensed everything. No monetary license was even possible.
Here are the ETSI FRAND licensing rules:
That's it. That's all the ETSI rules mention for rates.
What is not clear is if the final sentence refers only to other ETSI patents, or to all patents. However, it is public knowlege that if a licensee did not have related patents to share, they have often instead cross-licensed other types of IP (e.g manufacturing patents etc) to lower their rates.
In the UK, we have these young men called "boy racers" who take rust-bucket OLD, OLD cars, and spray paint them and put fibre glass body kits all over them, to attempt to fool themselves into thinking they're driving a premium sports car... can you see the analogy here?
I don't care if Android sells more - MacDonalds sell more burgers than a premium steak restaurant... but so what?
Still with those stupid and wrong analogies?
Well, if you're happy thinking that your products is superior to others, the feel happy.
It's not Apple's fault that most phone makers can't come up with a profitable product and sell it without BOGOF offers. In fact, it is arguably down to Apple that customers expect more from their "phones" in the first place.
BTW Apple gets high margins precisely because they concentrate on one high-end product,
To be fair - if EVERYONE followed Apple's model - the cell market wouldn't succeed because it would be leaving many people without the ability to own a phone.
If EVERYONE followed Apple's model, there would be a huge business opportunity for someone to sell low cost phones. That's why EVERYONE isn't following Apple's model, and your point is moot.
Samsung copied off Apple on the test.
Apple told some teachers.
Now you think it's okay for Samsung to tattle on Apple to the teachers?
Good logic there. Apple didn't start it - Samsung did.
Exactly my point. Did you see what comment I was REPLYING to?
By the way (and I admit I only learned this a few years back) - that expression (moot) is wrongly used.
http://litreactor.com/columns/20-common-grammar-mistakes-that-almost-everyone-gets-wrong
Moot
Contrary to common misuse, “moot” doesn’t imply something is superfluous. It means a subject is disputable or open to discussion. e.g., The idea that commercial zoning should be allowed in the residential neighborhood was a moot point for the council.
But in the mid-19th century people also began to look at the hypothetical side of moot as its essential meaning, and they started to use the word to mean "of no significance or relevance." Thus, a moot point, however debatable, is one that has no practical value.
Samsung copied off Apple on the test.
Apple told some teachers.
Now you think it's okay for Samsung to tattle on Apple to the teachers?
Good logic there. Apple didn't start it - Samsung did.
No.
That's it's historical use, from the free dictionary I find:
Basically, Samsung is guilty of abusing Standard Essential patents, as usual. What Samsung invariably claims is that their patent(s) are not part of the pool of "Standards Essential" patents subject to FRAND terms despite all the evidence and declarations upheld elsewhere; but Samsung nevertheless claims their patent is essential to the technology that Apple is evidently using in certain products (allegedly "by definition" if an Apple product is claimed to do x,y,z), and therefore Samsung claims Apple must be infringing on the patent.
Apple is disputing that Samsung has a patent that is "essential" to the technology, and yet is somehow not an internationally recognized Standards Essential patent subject to FRAND terms. IF this is even remotely the case, then Apple has done its own work and implemented its own technology to accomplish the same job. Likely, the patent in question has already been declared a Standards Essential Patent subject to FRAND terms elsewhere and for other companies who already license it.
Any patent on specific technology absolutely required by everyone in the business would be/should be deemed a Standards Essential patent that is licensable under FRAND terms. It's just that Samsung/Korea, etc. recognize their international obligations only when it suits them, but are happy to both apply their own rules cavalierly in their own country and play upon bodies like the ITC in other countries. It's shameful. Here we have the ITC looking out for the interests of a cavalier Korean company who has no regard for international declarations, obligations or the rule of law anywhere, including in its own country. It's like dealing with terrorists -- the ITC should have no dealings with them whatsoever. Apple follows all the rules but has to compete with those who follow none.
I'm not arguing that it's fair, but rather suggesting that Apple shouldn't be above playing by the rules.
Apple did try to play by the rules, it's Samsung that intentionally trapped Apple into the situation. A 2.4% rate for this one patent is purely trying to irritate Apple into a "you're crazy, I'm simply ignoring you" outrageous mood. And, Samsung's tactic worked well this time. It's a pity to see this type of evil tactics to play successful role, though.
Any thing to back this? Can you show what is paying everyone else?
The clear fact can be deducted very very easily with a very simple calculation -- if you apply a similar rate (2.5% for one patent) to all of the other patents involved in the phone, Apple would have to pay at least 250% of its revenue for the patents held by other companies.
Pay attention, it is a FRAND patent, so the "Fair" and "Reasonable" part have to apply to the license rate. 2.4% of the whole device for this one patent? Really? Are you suggesting Apple to pay 240000% of their revenue for the 10k patent involved? These are all-in-one devices.
I'm not arguing that it's fair, but rather suggesting that Apple shouldn't be above playing by the rules.
Well, European Courts in the United Kingdom and the Netherlands completely disagreed with that and found that Samsung did NOT copy Apple's "rectangle with rounded corners" design. The last ruling in this regard only happened a few days ago and was made by the Dutch supreme court.
I'm amazed by the people who can't seem to grasp that:
- Different countries have different laws. Different laws applied to the same facts, can (and should be expected to) produce different rulings.
- EU laws, and US laws differ. Often in significant ways.
- Thus, it is no surprise that EU law and US law produced different rulings when applied to the same facts.