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Nortel/Rockstar, Google/Motorola deals create balance of terror on software patents

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On Monday, the US Department of Justice approved the sale of Nortel's patent portfolio to a consortium led by Apple and Microsoft. At the same time, the DOJ and the European Commission allowed Google to buy Motorola Mobility, thus giving the search company a sizable patent portfolio.

"We appreciate that competition authorities in the US and Europe continue to take software patents seriously as a risk to competition," says Karsten Gerloff, President of the Free Software Foundation Europe. "However, we believe that the commitments made by Google, Microsoft and Apple regarding their patent licensing policies are not sufficient to allow everyone to compete on equal terms."

The terms of those commitments do nothing to ensure that the software patents in the portfolios in question can be implemented in Free Software.

While Microsoft has said that it will not seek injunctions against companies using its standard-essential patents, this policy merely restates the commitments Microsoft has already made to standards organisations. Microsoft will only license its patents on so-called "RAND" terms (short for "reasonable and non-discriminatory"). These typically require the company that implements the patents to pay a licensing fee per unit.

Despite their name, such conditions are largely incompatible with Free Software based on Open Standards, standards which can be implemented by anyone in any business or software model. This means that Microsoft remains free to use its patents to block or harm some of its most important Free Software competitors, such as the GNU/Linux operating system and the LibreOffice productivity suite.

"By greenlighting both the Google and Nortel transactions, the DOJ has merely created a balance of terror where patents are concerned," says Gerloff. "Small companies and individual software developers don't have the deep pockets required to play the patent litigation game. They will suffer as a result of this deal, along with the shareholders of Google, Microsoft and Apple. When elephants dance, the smaller wildlife gets crushed."

FSFE submitted a comprehensive statement of concern to the US Department of Justice in September 2011.