Microsoft wants to make Android more expensive, Apple wants to make it less usable

An administrative judge at the International Trade Commission (ITC) has issued an initial determination that HTC is infringing on 2 Apple patents, which — in a worst case scenario — could result in an import ban of iPhone-competing HTC Android smartphones. HTC’s stock has taken a hit since the ruling, obviously, but it’s important to remember it’s an initial ruling and a lot can change between now and any final decision, including an agreement between HTC and Apple, similar to HTC’s existing agreement with Microsoft.

Florian Mueller from FOSS Patents doesn’t think that’s likely, however.

For Apple this is not just about money. They’re not going to let HTC build fully functional smartphones and tablets in exchange for $10 or $20 per device unless HTC owns patents that Apple absolutely needs to license.

It’s a fallacy to assume that Apple v. HTC is just the usual patent dispute between two large players, and therefore going to have the same kind of happy end. This one is different. From a shareholder value point of view, what Apple needs to achieve — even if it costs a lot of time and money — is as much of a technological gap as possible between its own products and the Android-based products offered by HTC and other vendors.

In other words, as Florian discussed in our World War Patents podcast, while Microsoft seems to want to make Android more expensive (through licensing fees), Apple wants to make it less usable.

HTC meanwhile, could be fighting back using a company called S3 as a proxy. HTC’s chairwoman is a major S3 shareholder, but S3 has to do what’s best for S3 and that could end up being a licensing agreement with Apple that doesn’t end up providing any cover for HTC.

I could imagine a situation in which Apple might agree on a partial cross-license that would grant Apple access to all of HTC’s and S3′s patents while HTC would get access to only some of Apple’s patents: maybe just enough so that HTC can at least continue to sell Android-based products of some kind, but those products could be limited and there might be substantial degradations of the user experience.

Google, for their part, is continuing it’s terrifying silence on all things patent related, including a remarkable non-answer by Larry Page during the latest financial results conference call. This probably means they’re either playing their cards very close to their ninja vests, or they’re just not concerned with how this might play out, including the unlikely possibility of HTC switching to Windows Phone exclusively, just to avoid any more patent-related headaches.

Check the link below for Florian’s full rundown and his excellent “battlemap” visualization of the dispute.

[FOSSPatents]