Apple must be giggling this morning to the reports that Microsoft plans to charge patent royalty fees to Taiwan manufacturers Acer and Asutek. The fees are for intellectual property of Microsoft included in Google’s Android smartphone operating system. To Apple, “the enemy of my enemy is my friend.”
Recall that Google stretched its license with Sun, now Oracle, to port PC Java to create the Android smartphone operating system. That license stretching is the subject of litigation. Moreover, Google receives no or little revenue from Android.
Microsoft, which has little clout or revenue these days from the smartphone market in spite of Windows Mobile, is leaving Google and Oracle to litigate over phones. But Microsoft is blasting a clear line in the sand over netbooks (i.e., low end PCs) with Asutek (the Asus brand) and Acer, a top-tier PC company.
Since a netbook arguably can do more than a smartphone, Microsoft is holding out for much higher patent license fees than it gets on smartphones. However, even grade-school critical thinkers see through Microsoft’s ploy; use Windows 7 on netbooks. Microsoft currently has about a 90% market share in netbook OS with Windows, with the rest of the installed base largely Linux. Microsoft clearly does not want to concede OS share to Andoid in netbooks now or tablets in 2011.
Greater license fees are a good thing for Microsoft shareholders. But weakening Apple iPad competitors with higher fees also helps Apple shareholders.