Google blasts Apple, Microsoft for patent gang-up

LOS ANGELES/SAN FRANCISCO Wed Aug 3, 2011 6:48pm EDT

Google Inc's logo is seen at an office in Seoul in this May 3, 2011 file photograph. REUTERS/Truth Leem/Files

Google Inc's logo is seen at an office in Seoul in this May 3, 2011 file photograph.

Credit: Reuters/Truth Leem/Files

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LOS ANGELES/SAN FRANCISCO (Reuters) - Google Inc, fresh off losing a bid to buy thousands of valuable patents from bankrupt Nortel, accused its biggest rivals on Wednesday of banding together to block the Internet giant in the red-hot smartphone arena.

In a rare public outburst, Google Chief Legal Officer David Drummond blasted Microsoft, Apple, Oracle and "other companies" for colluding to hamper the increasingly popular Android mobile software by buying up patents, effectively imposing a "tax" on Android cellphones.

Apart from increasing costs for consumers, snapping up the patents will stifle technological innovation, he said.

"Microsoft and Apple have always been at each other's throats, so when they get into bed together you have to start wondering what's going on," Drummond wrote in a blog post.

He referred to "a hostile, organized campaign against Android by Microsoft, Oracle, Apple and other companies, waged through bogus patents."

An Apple spokesman declined to comment.

Google is forging ahead in the smartphone market but has been hampered by a lack of intellectual property in wireless telephony, which has exposed it to patent-infringement lawsuits from rivals including Oracle.

It lost out on the Nortel patents to a consortium grouping Apple, Microsoft, Research in Motion and others, which together paid $4.5 billion.

Google individually had bid up to $3.4 billion for those patents before teaming up with Intel Corp, which on its own had bid up to $3.1 billion, according to a source familiar with the matter.

They bid through $4 billion and then tapped out, another source had told Reuters.

INCREASING PATENT LAWSUITS

The Internet search leader is now in talks to buy InterDigital, a key holder of wireless patents valued at more than $3 billion, according to the Wall Street Journal.

Google, being a software company, was not focused on patents for a long time but is now shopping to stock up. It recently acquired over 1,000 patents from IBM.

Drummond said Google was looking to further stengthen its patent portfolio.

The wireless industry has been embroiled in a wave of patent suits in recent years as incumbents try to protect their position against newcomers like Google, which entered the market three years ago with Android.

The software, which is now used by phone makers including HTC, Motorola and Samsung, has rapidly overtaken Nokia to become the world's most popular smartphone platform, with about a third of the market.

HTC received a setback last month when a U.S. trade panel said HTC had infringed two of Apple's patents.

Also, Samsung has delayed the Australian launch of its latest Galaxy tablet due to a patent dispute with Apple, which says the South Korean electronics giant "slavishly" copied the iPhone and iPad.

Oracle is suing Google, claiming the Internet search company's Android software infringed on Java patents that it inherited through an acquisition of Sun Microsystems in 2010.

Patent acquisitions are expected to accelerate, with IBM and Kodak often mentioned as shopping intellectual property on the market.

(Reporting by Edwin Chan and additional reporting by Alistair Barr and Poornima Gupta; Editing by Ted Kerr)

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