Could Android become to expensive to make?

Android market share is impressive to say the least.  Starting at 3% to a dominating 48% over the last 2 years.  Some analysts say they could become the next domination since Microsoft in the mid 90’s.

An Apple a day may keep the doctor away, but it may drive handset prices up.  Patent wars between Google, HTC, Motorola and Samsung have raged.  Google in its present state has a lot to lose at ths point.  They are the newest and own the fewest patents.

“This is an arms race,” says Christopher Marlett, chief executive of investment bank MDB Capital Group. “Other companies have more bombs than Google—and they’re not afraid to use them.”

BusinessWeek says:

Patent lawsuits are often predictable. Company A sues Company B for copying an invention or proprietary technology. Company B digs through its own patent hoard, finds one it can accuse Company A of violating, and countersues. The two parties end up signing cross-licensing agreements that give the companies the rights to each other’s patents.

Google has only a handful of patents compared to product monsters such as RIM, Motorola and Nokia who own a couple thousand a piece in the mobile world.  Google did make a $900 million offer to buy the portfilio of Nortel and was defeated by 4.1 Billion in another offer from a consortium that includes Apple, Microsoft, RIM, and Sony.

Marshall Phelps, the lawyer credited with pioneering the patent monetization business when he worked for IBM in the early 1990s says

Intellectual property experts don’t think Google or its partners will be sued into submission, or that Android will succumb to death by a thousand lawsuits. Few patents in tech history have been so fundamental that they couldn’t be worked around

Whats this all mean?  HTC is now giving Microsoft $5 for each handset made.  This could happen to Google…and if it does…will Android be to expensive to make?


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