Apple threatens UK market exit if court orders 'unacceptable' patent fees(appleinsider.com)
appleinsider.com
Apple threatens UK market exit if court orders 'unacceptable' patent fees
https://appleinsider.com/articles/21/07/11/apple-attorneys-threaten-uk-market-exit-if-court-orders-unacceptable-patent-fees
16 comments
What do you think of patents Apple owns?
If some company decides to borrow those patents and Apple asks for money, who should set the price? Again, Apple?
If some company decides to borrow those patents and Apple asks for money, who should set the price? Again, Apple?
Patents shouldn't exist.
In this case, I'm glad it's actually targeting Apple. There are a bunch of small innovative companies targeted by patent trolls that don't have means of Apple to fight back and actually change the system to be more level-headed.
But I'm afraid Apple will not fight for the reform of the patent system, but will just try to protect itself. In which case I don't care about the outcome, since Apple also uses the same patent trolling tactics elsewhere to suppress its competition, e.g. litigations against Samsung in Germany, to name one such case.
But I'm afraid Apple will not fight for the reform of the patent system, but will just try to protect itself. In which case I don't care about the outcome, since Apple also uses the same patent trolling tactics elsewhere to suppress its competition, e.g. litigations against Samsung in Germany, to name one such case.
They are literally fighting it with this case, no? Exiting if they fail will also be great as it might become more clear to those who can change the system how much of a detriment it is.
If apple's UK iPhone profits really are in the c. 50mil range, then a (5 to 10)bn fee to remain is commercially non-viable.
Note that this is about Apple's ability to sell an iPhone in the UK, and as far as I can see, it wouldnt affect whether the entire company would remain in the UK.
If I were apple, I would withdraw a product from a country which supported this kind of racketeering.
Note that this is about Apple's ability to sell an iPhone in the UK, and as far as I can see, it wouldnt affect whether the entire company would remain in the UK.
If I were apple, I would withdraw a product from a country which supported this kind of racketeering.
> If I were apple, I would withdraw a product from a country which supported this kind of racketeering.
Lol. If this is "racketeering" then Apple will have to withdraw from literally every Western developed nation.
This case only didn't happen in the US because the court didn't find the patent to be valid, by a thin margin.
Lol. If this is "racketeering" then Apple will have to withdraw from literally every Western developed nation.
This case only didn't happen in the US because the court didn't find the patent to be valid, by a thin margin.
Leaving the UK market won't save them licence fees. They've already been incurred. It would be less like relatiation, more like flouncing off in a huff.
> A court case later in July will determine whether Apple will have to make a legally binding pledge to abide by judge-set payout rates in the July 2022 trial
They haven't paid them yet. And if they leave the market, they have no reason to pay it.
They haven't paid them yet. And if they leave the market, they have no reason to pay it.
Apple sells 7 million iPhones a year in the UK, Google tells me. Even at just 100 profit a unit, should be way more than 50 million in profit. Ignoring income from other things like accessories, the store etc.
Not to mention, the complementary effects. Someone buying an iPhone today is more likely to choose an Apple device as their laptop. Someone buying an iPhone today is more likely to buy another iPhone in a few years, over an Android phone.
If it's only 7 million, then Apple would definitely leave.
I had no idea it was that low. I would have thought it would be from 10 to 14. To put it in perspective, Apple sells 4 times that many in China. With China and the US being their bread and butter. Also, their marketshare in China and the US has way more upside. (Room for growth.)
I can understand now. You definitely don't want to pay money to stay in a market that has less upside than your money makers. That would mean you're using money from your money makers to fund customers who are not your money makers. From a much smaller businessman's perspective, I'd file that under, "There are some customers out there that are too much trouble."
I had no idea it was that low. I would have thought it would be from 10 to 14. To put it in perspective, Apple sells 4 times that many in China. With China and the US being their bread and butter. Also, their marketshare in China and the US has way more upside. (Room for growth.)
I can understand now. You definitely don't want to pay money to stay in a market that has less upside than your money makers. That would mean you're using money from your money makers to fund customers who are not your money makers. From a much smaller businessman's perspective, I'd file that under, "There are some customers out there that are too much trouble."
There are 65 Million people in the UK, China and the United States are significantly larger both in terms of population. I haven't checked the numbers, but it is not unreasonable to assume that there is a similar amount of iPhones sold per year per capita in the UK as compared to those other two markets.
Doesn't seem to be that detrimental in China. Apple always manages to work something out over there.
Apple is super pro patents, they never go for patent invalidation. Case in point they got sued by S3 for S3TC, despite S3TC being stolen Apple QuickTime Road Pizza patent https://news.ycombinator.com/item?id=26758884, and caved in without much fight.
Apple knows how to play the patent game and routinely petitions PTAB review to invalidate patents. I'm willing to wager that there are at least a few dozens of on-going reviews petitioned by Apple (and its proxy) at any given moment. Take for instance Apple's lawsuits with VirnetX which have been dragged out for several years appeal after appeal with multiple patent invalidations -- in one of the lawsuits, Apple ended up losing to the tune of $500+M, finally paid out in 2021. Apple is pro-patent -- and also one of the most egregious abuser -- insofaras it can game the system in their favor. Like many patent trolls, Apple also shops around for favorable legal outcome, aka, forum shopping, -- eg, Lucy Koh in Apple's backyard is one notorious example.
And who can forget Apple's patent troll operation, Rockstar consortium, that crashed and burned as it was taking off.
And who can forget Apple's patent troll operation, Rockstar consortium, that crashed and burned as it was taking off.
> bunch of small innovative companies
The smart move for the patent troll is to target some of these smaller companies and write license agreements in the form of "I agree to pay $20 per device sold to license this patent". $20 is nothing to a company selling Ships, Oil rigs, tunnel boring machines, etc.
Then when it comes to apple, paying $20 per iphone is suddenly rather expensive, but the troll can show the court lots of licensees all agreeing to pay that rate, and it can then be established as a reasonable rate for this specific patent.
The smart move for the patent troll is to target some of these smaller companies and write license agreements in the form of "I agree to pay $20 per device sold to license this patent". $20 is nothing to a company selling Ships, Oil rigs, tunnel boring machines, etc.
Then when it comes to apple, paying $20 per iphone is suddenly rather expensive, but the troll can show the court lots of licensees all agreeing to pay that rate, and it can then be established as a reasonable rate for this specific patent.
> A patent is a government-sponsored monopoly which shouldn't be "pooled" by "patent companies" whose only purpose is to use the state to extract money from companies actually producing goods.
Devil's advocate:
If the original holder of a patent is a small fry, and does not have the resources to go after the big fish if they take advantage of the patent, shouldn't the original inventor have the right to sell the patent to get something, and then the new holder can use their potentially larger resources to get licensing compliance.
Devil's advocate:
If the original holder of a patent is a small fry, and does not have the resources to go after the big fish if they take advantage of the patent, shouldn't the original inventor have the right to sell the patent to get something, and then the new holder can use their potentially larger resources to get licensing compliance.
What you're saying:
>If the original holder of a patent is a small fry, and does not have the resources to go after the big fish if they take advantage of the patent, shouldn't the original inventor have the right to sell the patent to get something, and then the new holder can use their potentially larger resources to get licensing compliance.
Hits the crux of the issue. A patent is economically/politically/socially worthless to the inventor themselves without the ability to spend inordinate amounts of legal muscle to tell people they can't use it, and the effective exercise by a patent holder of a patent renders the patent valueless to society for the duration, and creates many perverse incentives and business models for non-practicing entities.
In fact, at this point I'd argue the corpus of patents out there is nowadays less useful to the inventive than it is to the legal profession to keep themselves in work. The last time I read a patent to truly understand something was to figure out how a fire-alarm use casing went back together, and even then, that was of spotty levels of help.
>If the original holder of a patent is a small fry, and does not have the resources to go after the big fish if they take advantage of the patent, shouldn't the original inventor have the right to sell the patent to get something, and then the new holder can use their potentially larger resources to get licensing compliance.
Hits the crux of the issue. A patent is economically/politically/socially worthless to the inventor themselves without the ability to spend inordinate amounts of legal muscle to tell people they can't use it, and the effective exercise by a patent holder of a patent renders the patent valueless to society for the duration, and creates many perverse incentives and business models for non-practicing entities.
In fact, at this point I'd argue the corpus of patents out there is nowadays less useful to the inventive than it is to the legal profession to keep themselves in work. The last time I read a patent to truly understand something was to figure out how a fire-alarm use casing went back together, and even then, that was of spotty levels of help.
Sure -- my conditions were on the holder of the patent, not whether it can be sold.
In the case the patent owner isn't doing any R&D or engaging in economically productive activity (at all; nor esp. related to the patent).
I think we need, even a very minimal, condition here:
The government is only going to shake-down your competitor if you're actually in the same market. If you're just a guy hold a slip of paper, sorry, the government isn't your muscle.
In the case the patent owner isn't doing any R&D or engaging in economically productive activity (at all; nor esp. related to the patent).
I think we need, even a very minimal, condition here:
The government is only going to shake-down your competitor if you're actually in the same market. If you're just a guy hold a slip of paper, sorry, the government isn't your muscle.
> In the case the patent owner isn't doing any R&D
But by licensing the patent to interested parties, they might be supporting R&D of people who might not otherwise be doing R&D in this direction.
The ability to license some tech you know is likely to work in the form of a patent has some value.
But by licensing the patent to interested parties, they might be supporting R&D of people who might not otherwise be doing R&D in this direction.
The ability to license some tech you know is likely to work in the form of a patent has some value.
They might be. All of this can be weighed by judges.
I'd be inclined to say: sorry, licensing/selling to companies not in the market is now not possible.
If you need to mitigate risk, insurance companies (etc.) can offer products against patents -- they still have value, just only now to companies actually operating in the relevant market.
And of course, "relevant market" can be read broadly by judges.
Either way, patent law is running amok over innovation, and goverment shake downs and money transfers from producers to rentseekers is a net loss for everyone.
I'd be inclined to say: sorry, licensing/selling to companies not in the market is now not possible.
If you need to mitigate risk, insurance companies (etc.) can offer products against patents -- they still have value, just only now to companies actually operating in the relevant market.
And of course, "relevant market" can be read broadly by judges.
Either way, patent law is running amok over innovation, and goverment shake downs and money transfers from producers to rentseekers is a net loss for everyone.
No, because patents shouldn't even exist to begin with.
How does that harbor fair trade? Neither the inventor nor the holder have made any attempt to bring a product to market.
It should be the burden of the court to prove that the patent was actively being used (by the holder) to produce a product and that the infringement directly hurt the potential target market of the product in question.
It should be the burden of the court to prove that the patent was actively being used (by the holder) to produce a product and that the infringement directly hurt the potential target market of the product in question.
The patent may be too expensive for a small fry to convert into a product. Requiring them to do that turns the patent system into an instrument for incumbents to absorb inventions from others (who cannot afford to build the full product) while not having to release any of their own rights (because they can afford to build the product, so preserve the patent).
A non-practising patent holder is also more likely to licence the patent to lots of other entities compared to one that makes products. This is one of the concerns around NVidia's proposed takeover of ARM, a non-practising entity that creates and licences computer processor designs.
A non-practising patent holder is also more likely to licence the patent to lots of other entities compared to one that makes products. This is one of the concerns around NVidia's proposed takeover of ARM, a non-practising entity that creates and licences computer processor designs.
Licensing is providing a product through 3rd party. I’m talking about a holder that has just sat on the patent and no product has been developed from its issue.
If no product is ever developed, then there is no licensing or infringement. A troll may still try to use it to suppress some other product but that can be done regardless of whether a product is developed.
I looked at one of the patents from the Apple case, US6393286B1. Unlike the "small fry" scenarios described above, this was registered by Ericsson. I cannot tell whether the patent is actually inventive, but it seems likely that Ericsson themselves did create a product, as they were involved in creating the 3G standards in the 1990s and they also produced phones. The accusation here is that Apple also created a product based on the same technology, without paying the licensing fees. The current holder bought the rights to the patent in the secondary market. The effect on Apple is the same whether it is Ericsson or the current owner enforcing it.
I looked at one of the patents from the Apple case, US6393286B1. Unlike the "small fry" scenarios described above, this was registered by Ericsson. I cannot tell whether the patent is actually inventive, but it seems likely that Ericsson themselves did create a product, as they were involved in creating the 3G standards in the 1990s and they also produced phones. The accusation here is that Apple also created a product based on the same technology, without paying the licensing fees. The current holder bought the rights to the patent in the secondary market. The effect on Apple is the same whether it is Ericsson or the current owner enforcing it.
I just looked up the patent and I now support Apple 100%. That patent is nothing. Like what even is the patent? Measure communication between mobile terminals? What is the patent protecting? What process has been described that’s been violated? I was giving the patent the benefit of the doubt, but that patent is superfluous. Is it the specific radio frequency? Is it specific to mobile phones? Was it proved that this was a unique invention that couldn’t be confused with a different method?
What product did Apple make that specifically infringes on this patent?
What product did Apple make that specifically infringes on this patent?
If we want that to be the case then we need to start differentiating between patents still owned by the original inventor and those transferred through whatever means. Making it so transferred patents lose their protection unless they are actively being used by their new owner would eliminate patent companies being a law office and nothing else while still allowing for people who want to just run a Bell Labs-esque institute without dealing with manufacturing to still run a decent businesses. You could also extend this to disallowing licensing for non-original owner patents too, though I'm not as sure about the second-order effects on that one.
There's probably some complications to that, not that I don't think it's a good idea. I say, if so, address them.
For instance heirs. Inventor invents, dies while they would and should still have all rights, say it's the day after being awarded, patent is transferred.
Inventor recieves a patent, but later that asset or all their assets are seized by the government as part of a criminal process, or awarded to someone else as part of a legal action.
There's probably lots of odd situations I can't even imagine where a patent like any other preoperty or asset (or debt or liability or responsibility) is transferred, without it being a sale and without the recipient deserving to be penalized or put under any extra burden.
Even fully business transactions like a company buys an entire other company, rather than specifically a patent. I'm not sure in that case the assets should evaporate or lose their "first sale" extra value. Maybe they should, but also maybe it's just as fair to consider the new owner still the originator, since the originator is a company which still exists. Maybe it should be considered a transfer if the purchasing company closes the original company as a distinct entity and simply ingests the assets.
Maybe this is all pretty easily handled and it's no problem by just having some sort of legal metadata where the patent has a property flag that says if it's considered to be in a state of being before or after first sale, and any legal process that performs a transfer records whether this transfer constitutes a sale or not.
Another gotcha, it probably also means somehow identifying and disqualifying some "gifts" and allowing others.
Anyway I do like the idea.
For instance heirs. Inventor invents, dies while they would and should still have all rights, say it's the day after being awarded, patent is transferred.
Inventor recieves a patent, but later that asset or all their assets are seized by the government as part of a criminal process, or awarded to someone else as part of a legal action.
There's probably lots of odd situations I can't even imagine where a patent like any other preoperty or asset (or debt or liability or responsibility) is transferred, without it being a sale and without the recipient deserving to be penalized or put under any extra burden.
Even fully business transactions like a company buys an entire other company, rather than specifically a patent. I'm not sure in that case the assets should evaporate or lose their "first sale" extra value. Maybe they should, but also maybe it's just as fair to consider the new owner still the originator, since the originator is a company which still exists. Maybe it should be considered a transfer if the purchasing company closes the original company as a distinct entity and simply ingests the assets.
Maybe this is all pretty easily handled and it's no problem by just having some sort of legal metadata where the patent has a property flag that says if it's considered to be in a state of being before or after first sale, and any legal process that performs a transfer records whether this transfer constitutes a sale or not.
Another gotcha, it probably also means somehow identifying and disqualifying some "gifts" and allowing others.
Anyway I do like the idea.
How would this look different from someone holding a perfectly valid patent that Apple was using without licensing it?
(I have no idea as to whether this one is valid or not, I'm as against patent trolls suing people with bogus patents as anyone else)
Surely the patent IS the innovation, and a perfectly valid way to use that innovation is to license it to larger companies.
(I have no idea as to whether this one is valid or not, I'm as against patent trolls suing people with bogus patents as anyone else)
Surely the patent IS the innovation, and a perfectly valid way to use that innovation is to license it to larger companies.
The patent holder would be a company operating in the same market as apple, having a viable market for products somewhat related to the patents they hold. Eg., an electronics company.
If they can't meet that condition, sell the patent to a company who can. They'll actually innovate with it (ie., use the licence feeds to fund something useful).
If they can't meet that condition, sell the patent to a company who can. They'll actually innovate with it (ie., use the licence feeds to fund something useful).
This means all patents will eventually flow to a single holder over time (the one most able to offer a patent buyout pipeline). This is a terrible idea without strong anti-trust and forced break-up and anti-consolidation enforcement.
I hate patent trolls too, but if your two outcomes are A) all you'll get is a bunch of umbrella companies coupling a legal firm to a modest widget mill. This is a great way to proliferate e-trash though and B ) The leviathan in town sets up a window to buy out every patent they can to save no long term litigation costs... Maybe your system is flawed to begin with.
I hate patent trolls too, but if your two outcomes are A) all you'll get is a bunch of umbrella companies coupling a legal firm to a modest widget mill. This is a great way to proliferate e-trash though and B ) The leviathan in town sets up a window to buy out every patent they can to save no long term litigation costs... Maybe your system is flawed to begin with.
I don't see how "operating in the same field" or even "somewhat related" can be determined or valid.
Tons of technology is used in fields other than where it originated.
Probably a lawyer didn't legitimately invent an important new chemistry for a glue, but a baker could, or a landscaper, etc. And math and process/logistics can come from anyone anywhere at any time, even a lawyer.
This may be hard to define and be correct and fair about it.
Then again... in that case they'd be the originator which could be a special status vs purchased as an asset. Maybe not so hard to manage after all.
Tons of technology is used in fields other than where it originated.
Probably a lawyer didn't legitimately invent an important new chemistry for a glue, but a baker could, or a landscaper, etc. And math and process/logistics can come from anyone anywhere at any time, even a lawyer.
This may be hard to define and be correct and fair about it.
Then again... in that case they'd be the originator which could be a special status vs purchased as an asset. Maybe not so hard to manage after all.
This is a great condition that would invalidate all patent-trolls.
It should be fairly trivial for a judge to ascertain whether someone owns a patent to use legitimately (tech company owning a tech patent for example, whether they are currently using it, invented it, bought it etc.) or whether they are a bunch of lawyers extorting money from legit companies by (ab)using the legal system.
It shouldn't matter who owns a patent. If the person or company who registered it has decided to 'cash it in' and sell it to a company whose business is patent licensing is OK. Whether or not the patent is valid is the important issue. Optis 'won' $506m in the US as well, but the supreme court reverted the decision on Apple's appeal. The UK court has decided that it is valid (for now).
Something very important to note here is that the comment was made in regard to a case arguing whether or not Apple agree to be legal bound by another case next year to decide the patent license fee. Apple are arguing that they'll leave the market if the fee is too high. The reality is actually that if they agree to a binding agreement in the current case, and then decide the fee is too high after the case next year and refuse to pay it, they'll be banned from selling iPhones in the UK. Their exit from the market won't be their choice.
This remark is a scare tactic aimed at making the court agree a lower patent fee. No one believes that Apple will voluntarily leave the UK market, but if the court imposes a high fee Apple might be forced to. It's highly improbable, but it's not entirely impossible.
Something very important to note here is that the comment was made in regard to a case arguing whether or not Apple agree to be legal bound by another case next year to decide the patent license fee. Apple are arguing that they'll leave the market if the fee is too high. The reality is actually that if they agree to a binding agreement in the current case, and then decide the fee is too high after the case next year and refuse to pay it, they'll be banned from selling iPhones in the UK. Their exit from the market won't be their choice.
This remark is a scare tactic aimed at making the court agree a lower patent fee. No one believes that Apple will voluntarily leave the UK market, but if the court imposes a high fee Apple might be forced to. It's highly improbable, but it's not entirely impossible.
> It shouldn't matter who owns a patent. If the person or company who registered it has decided to 'cash it in' and sell it to a company whose business is patent licensing is OK. Whether or not the patent is valid is the important issue.
Disagree, fully, 100%. To believe this you have to first buy into the idea that the patent system is a good one and/or that people who are doing none of the actual work should be able to rent-seek the people who actually are. If you aren't using the patent you should not be allowed to force other companies to pay you for it, that's just a stupid system (even if it's the system we currently have). I don't care if it's Apple, Google, Facebook, Oracle, or an indie developer, none of them should have to put up with BS patents like this.
Disagree, fully, 100%. To believe this you have to first buy into the idea that the patent system is a good one and/or that people who are doing none of the actual work should be able to rent-seek the people who actually are. If you aren't using the patent you should not be allowed to force other companies to pay you for it, that's just a stupid system (even if it's the system we currently have). I don't care if it's Apple, Google, Facebook, Oracle, or an indie developer, none of them should have to put up with BS patents like this.
> If you aren't using the patent you should not be allowed to force other companies to pay you for it
Companies like ARM would not be able to exist under the system you propose. Their whole business model is creating patents and licensing them to others instead of using the patents themselves.
Preventing companies like ARM from licensing their patents would only benefit incumbents like Intel who can afford the massive amounts of investment required to turn those patents into chips.
Companies like ARM would not be able to exist under the system you propose. Their whole business model is creating patents and licensing them to others instead of using the patents themselves.
Preventing companies like ARM from licensing their patents would only benefit incumbents like Intel who can afford the massive amounts of investment required to turn those patents into chips.
So I think we can all agree there is a big difference between the generic/basic patents we’ve seen trolls use over and over again (stuff like “an input device causes and output device to do something”) and an instruction set/CPU architecture. Also I’d bet money ARM has multiple in-house processors for testing/R&D. That’s a far cry from the patent trolls who do nothing but “own” a patent they do nothing with and didn’t come up with in the first place most of the time.
All that said: so what? My ideal world wouldn’t have patents at all. They cause way more harm than good. And we’ve seen time and time again that the big companies will just straight up copy or buy up any competition, the system is broken.
All that said: so what? My ideal world wouldn’t have patents at all. They cause way more harm than good. And we’ve seen time and time again that the big companies will just straight up copy or buy up any competition, the system is broken.
> Also I’d bet money ARM has multiple in-house processors for testing/R&D
When I worked at ARM, we just used FPGAs to emulate the chips and waited for the customers to give us a board with the actual chips. Maybe another division did create their own hardware, but everything we worked with for testing in ours was from customers.
> there is a big difference between the generic/basic patents we’ve seen trolls use over and over again (stuff like “an input device causes and output device to do something”)
If it is a generic/basic patent, why should it make a difference whether the enforcer is a practising entity (PE) or not? Unlike a non-practising entity (NPE), a PE would be less inclined to licence it because they want to keep competitors out. ARM is big enough that they can instigate litigation on their own against infringers. Smaller inventors have no chance of doing that, and patent trolls are often their only venue. Many times, the problem is with bogus patents that should never have been granted because of prior art or obviousness (supported by the authorities failing to perform due diligence before granting patents). And the other is the expense of defending against a valid patent that does not apply to the defendant's product. Patent trolls' portfolios are often full of such patents, but this is not limited to NPEs.
> big companies will just straight up copy or buy up any competition
An example that comes to my mind is Nuance, a practising entity that engaged in frivolous patent infringement lawsuits against a new competitor Vlingo. Nuance did turn their patents into products (Dragon NaturallySpeaking), so they are not considered a patent troll under the usual definition. Yet, their actions against Vlingo were the same as that of a troll, and even though Vlingo won, they were weakened enough to be bought out by Nuance.
When I worked at ARM, we just used FPGAs to emulate the chips and waited for the customers to give us a board with the actual chips. Maybe another division did create their own hardware, but everything we worked with for testing in ours was from customers.
> there is a big difference between the generic/basic patents we’ve seen trolls use over and over again (stuff like “an input device causes and output device to do something”)
If it is a generic/basic patent, why should it make a difference whether the enforcer is a practising entity (PE) or not? Unlike a non-practising entity (NPE), a PE would be less inclined to licence it because they want to keep competitors out. ARM is big enough that they can instigate litigation on their own against infringers. Smaller inventors have no chance of doing that, and patent trolls are often their only venue. Many times, the problem is with bogus patents that should never have been granted because of prior art or obviousness (supported by the authorities failing to perform due diligence before granting patents). And the other is the expense of defending against a valid patent that does not apply to the defendant's product. Patent trolls' portfolios are often full of such patents, but this is not limited to NPEs.
> big companies will just straight up copy or buy up any competition
An example that comes to my mind is Nuance, a practising entity that engaged in frivolous patent infringement lawsuits against a new competitor Vlingo. Nuance did turn their patents into products (Dragon NaturallySpeaking), so they are not considered a patent troll under the usual definition. Yet, their actions against Vlingo were the same as that of a troll, and even though Vlingo won, they were weakened enough to be bought out by Nuance.
Well as you say it's "leave the market for mobile phones", ie., it'll be iPhone which goes -- rather than Apple as such.
If the fee is 20x on their profits from iphones, personally, I'd leave -- for a few years at least. The opportunity cost is very high: leave for 2+ years and prompt the UK gov to act. Then return.
Also, my issue is exactly with "validity" conditions. Regardless of what they are, my view is we need a change in the law to make cases of this kind non-starters.
My initial stab is this: patents have to held by companies operating in the relevant market to be valid. The ensures licensing fees go towards companies capable of innovation, and limits patent trolling.
I'd prefer, even, to add: those companies are using those patents; or otherwise, have +10 years from their last use in a product (etc.).
However, one step at a time.
If the fee is 20x on their profits from iphones, personally, I'd leave -- for a few years at least. The opportunity cost is very high: leave for 2+ years and prompt the UK gov to act. Then return.
Also, my issue is exactly with "validity" conditions. Regardless of what they are, my view is we need a change in the law to make cases of this kind non-starters.
My initial stab is this: patents have to held by companies operating in the relevant market to be valid. The ensures licensing fees go towards companies capable of innovation, and limits patent trolling.
I'd prefer, even, to add: those companies are using those patents; or otherwise, have +10 years from their last use in a product (etc.).
However, one step at a time.
Trying to blackmail the government by threatening to leave the market suggests phrases involving noses, faces, and spite. It's apple buyers that would be hurt by apple leaving the market -not the government, which would look weak if it capitulates to blackmail threats.
The government doesn't care about apple users. They don't care about any citizens. And anyway, the apple users can always buy their devices in the EU.
The government doesn't care about apple users. They don't care about any citizens. And anyway, the apple users can always buy their devices in the EU.
> If the fee is 20x on their profits from iphones, personally, I'd leave -- for a few years at least. The opportunity cost is very high: leave for 2+ years and prompt the UK gov to act. Then return
And loose the customers base who would otherwise be locked into iOS/Apple ecosystem? It’s not just profits from iPhones they would be loosing.
And loose the customers base who would otherwise be locked into iOS/Apple ecosystem? It’s not just profits from iPhones they would be loosing.
E.U. countries are very close by. Apple products would likely be in duty free in force.
Trade in used devices would be brisk, fed in part by what is brought in.
Then, Apple begins running ads for sympathetic members of parliament, with astonishing levels of cash.
Trade in used devices would be brisk, fed in part by what is brought in.
Then, Apple begins running ads for sympathetic members of parliament, with astonishing levels of cash.
You're right about the imports. Not sure the lobbying campaign would go like that: party discipline in the UK is too strong for picking off sympathetic MPs to be a useful strategy, and political advertising is very heavily regulated.
the devices that infringe identify themselves to cell towers don't they?
would be easy enough for the patent owner to obtain an injunction preventing new devices being used on major cellular operators
would be easy enough for the patent owner to obtain an injunction preventing new devices being used on major cellular operators
> Something very important to note here is that the comment was made in regard to a case arguing whether or not Apple agree to be legal bound by another case next year to decide the patent license fee. Apple are arguing that they'll leave the market if the fee is too high. The reality is actually that if they agree to a binding agreement in the current case, and then decide the fee is too high after the case next year and refuse to pay it, they'll be banned from selling iPhones in the UK. Their exit from the market won't be their choice.
I'm having trouble seeing why this sequence:
I'm having trouble seeing why this sequence:
Court: pay $X fee or stop selling iPhones.
Apple: OK, we'll stop selling iPhones.
Pay x or I'll break your legs.
I think you've gotten your example backwards. If you tell me "Pay $X or I'll break your legs", and I say I'll take the broken legs, and you break my legs -- you really want to argue that that's the decision branch where I wasn't really making a choice?
Of course you were... You could've paid.
Common law has the concept of "under duress". I'm sure other legal traditions have something similar. It is also common sense in the US culture in general that you can't be said to agree to having your legs broken in a situation like that.
While the mythical "homo econominus" may say that there's no difference between "give me $$$ or I'll inflict severe negative utility on you" and "give me $$$ or I'll reduce the positive utility you receive from selling goods by the same amount" by saying it's the same amount of utility in absolute terms in both branches, in practice nobody feels or operates that way, and that's with steelmanning this argument by declining to note all the obviously relevant ways in which this metaphor is a mismatch.
While the mythical "homo econominus" may say that there's no difference between "give me $$$ or I'll inflict severe negative utility on you" and "give me $$$ or I'll reduce the positive utility you receive from selling goods by the same amount" by saying it's the same amount of utility in absolute terms in both branches, in practice nobody feels or operates that way, and that's with steelmanning this argument by declining to note all the obviously relevant ways in which this metaphor is a mismatch.
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No doubt it's possible to reframe it so it looks like Apple's decision but it isn't really. It's more like;
Court: Pay $x fee
Apple: No
Court: Your punishment is that you're no longer to allowed to sell iPhones
In your framing, did Apple not choose to say "No"? It's not like they're not aware of the situation -- you're commenting on them talking about it.
The court is providing circumstances. Apple responds to circumstances. But the only way they can respond is by determining what they want to do, and then trying to do it.
Note also that in your framing, unless you believe the court would respond to Apple attempting to pay the fee by saying "no, you had your chance, it's gone now, get out of the market", it's still Apple choosing not to sell iPhones.
The court is providing circumstances. Apple responds to circumstances. But the only way they can respond is by determining what they want to do, and then trying to do it.
Note also that in your framing, unless you believe the court would respond to Apple attempting to pay the fee by saying "no, you had your chance, it's gone now, get out of the market", it's still Apple choosing not to sell iPhones.
In the interests of demonstrating a harsh penalty for judicial overreach, I would like to see this case made, and Apple abandon the market.
I don't know the British system well enough to understand what reaction public opinion would have on members of parliament, but some censure of the judge and reversal of the patent decision could happen.
I don't know the British system well enough to understand what reaction public opinion would have on members of parliament, but some censure of the judge and reversal of the patent decision could happen.
Even as a Brit, I don’t feel that I understand the British system, though from everything post 2016 I’ve reached the conclusion that neither does the current British government, and therefore they may well censure the judges even though the judges are supposed to be independent.
Or they might do nothing, because Apple isn’t a British company and they want to help Amstrad take over its market share.
Or they might do nothing, because Apple isn’t a British company and they want to help Amstrad take over its market share.
"I don’t feel that I understand the British system"
Probably doesn't help that there isn't a single UK-wide legal system...
Edit: There are 3 or 4 legal systems in the UK depending on how you count them:
https://en.wikipedia.org/wiki/Law_of_the_United_Kingdom#Thre...
Probably doesn't help that there isn't a single UK-wide legal system...
Edit: There are 3 or 4 legal systems in the UK depending on how you count them:
https://en.wikipedia.org/wiki/Law_of_the_United_Kingdom#Thre...
The judiciary isnt supposed to be independent. That is the american system.
In the UK all power is held by parliament and extends from parliament.
In the UK all power is held by parliament and extends from parliament.
The power may flow from parliament, but the judiciary is still (supposed to be) independent:
• https://www.judiciary.uk/about-the-judiciary/the-judiciary-t...
• https://www.judiciary.uk/announcements/swearing-in-of-the-ne...
• https://www.judiciary.uk/about-the-judiciary/the-judiciary-t...
• https://www.judiciary.uk/announcements/swearing-in-of-the-ne...
Judicial independence is a mainstay of most democratic countries ( separation of powers in general).
Parliament writes the laws - the judiciary interprets & implements them, as in all other democracies that I'm aware of.
That's not strictly true. It's the Crown that is the font of all power.
Parliament legislates as the Crown in Parliament - hence the mace must be present in the chambers while Parliament is sitting and all bills must receive royal assent to become Acts of Parliament.
There also exist powers that are (currently) outwith Parliament - namely the royal prerogatives.
The court system is similar, courts derive their power from the Crown, although, of course, they are subject to statute passed by Parliament.
Parliament legislates as the Crown in Parliament - hence the mace must be present in the chambers while Parliament is sitting and all bills must receive royal assent to become Acts of Parliament.
There also exist powers that are (currently) outwith Parliament - namely the royal prerogatives.
The court system is similar, courts derive their power from the Crown, although, of course, they are subject to statute passed by Parliament.
I don't know why this is being downvoted; compared to the US system, the UK system doesn't implement anywhere near the same amount of separation of powers. As you can read about in sources like [1]
While judges in the UK have life tenure and aren't allowed to stand for parliament, judges are constitutionally subordnate to parliament - they can't challenge the validity of acts of parliament.
And separation of executive and legislature is essentially nonexistent: Getting the support of a majority in parliament makes you the prime minister - and the first-past-the-post system makes it very common that a single party will control a majority of the seats.
[1] https://researchbriefings.files.parliament.uk/documents/SN06...
While judges in the UK have life tenure and aren't allowed to stand for parliament, judges are constitutionally subordnate to parliament - they can't challenge the validity of acts of parliament.
And separation of executive and legislature is essentially nonexistent: Getting the support of a majority in parliament makes you the prime minister - and the first-past-the-post system makes it very common that a single party will control a majority of the seats.
[1] https://researchbriefings.files.parliament.uk/documents/SN06...
To add to your comment,
The executive is staffed by members of the lower house.
Until recently the head of the courts were from the upper house. So the lower house provided the executive, and the upper provided the courts.
Compared to constitutional systems like the US, the UK is basically still in the same position.
There is no "constitution" that the legal system forces parliament to adhere to. Our courts simply enforce acts and "send them back" to parliament only when there are inconsistencies.
I actually regard the creation of the supreme court here in the UK a pretty silly thing, it should've reminded with the upper house.
Either way, it isnt independent in the US sense.
The executive is staffed by members of the lower house.
Until recently the head of the courts were from the upper house. So the lower house provided the executive, and the upper provided the courts.
Compared to constitutional systems like the US, the UK is basically still in the same position.
There is no "constitution" that the legal system forces parliament to adhere to. Our courts simply enforce acts and "send them back" to parliament only when there are inconsistencies.
I actually regard the creation of the supreme court here in the UK a pretty silly thing, it should've reminded with the upper house.
Either way, it isnt independent in the US sense.
[deleted]
In any of the British jurisdictions, neither parliament nor the government can dismiss judges. Nor can anyone else.
If they displease the government, then they might not be chosen to head lucrative judicial inquiries - I think that's the only sanction that government can inflict on them.
Neither government nor parliament can "reverse" a patent decision.
Government and parliament have been known to "censure" (criticise) judicial decisions; usually that behaviour provokes a negative reaction among educated people and thoughtful newspapers. It doesn't happen often.
The government can also appeal against sentence in crimnal cases, if they think the sentence was unduly lenient. This is fairly recent statute legislation, and controversial.
If they displease the government, then they might not be chosen to head lucrative judicial inquiries - I think that's the only sanction that government can inflict on them.
Neither government nor parliament can "reverse" a patent decision.
Government and parliament have been known to "censure" (criticise) judicial decisions; usually that behaviour provokes a negative reaction among educated people and thoughtful newspapers. It doesn't happen often.
The government can also appeal against sentence in crimnal cases, if they think the sentence was unduly lenient. This is fairly recent statute legislation, and controversial.
> neither parliament nor the government can dismiss judges
This is wholly untrue. Parliament can do what it pleases, including disestablish the judiciary and the executive.
This is wholly untrue. Parliament can do what it pleases, including disestablish the judiciary and the executive.
This is technically true but kind of irrelevant? If it comes down to that level of radical transformation, of abolishing the judiciary, the state is on its way to disintegrating. Rather like the Royal power that exists only as long as it's not used.
You're right, it can do what it pleases; it has been known to behead a monarch.
But it still can't dismiss a judge, because Parliament doesn't employ the judges.
But it still can't dismiss a judge, because Parliament doesn't employ the judges.
I think that is the material change we need. Patents must be used as an active and relevant part of your product or you don't deserve protection. The point is to encourage innovation and from someone from basically just reselling your idea. If you aren't selling it, then why do you deserve protection?
This would mean only mega corporaions capable of funding hundred million dollar FDA trials could have drug patents, and people who came up with novel drug mechanisms would all have to work for these companies rather than specialize on early stage innovative research and sell to them.
Mega corporations capable of funding FDA trials buy patents and use them to create/produce drugs. Patent trolls don't create anything.
Mega corporations capable of funding FDA trials buy patents and use them to create/produce drugs.
They do that sometimes. Other times they discover a drug chemistry, patent it, and then do nothing with it because they decide the market isn't profitable enough. That stops other companies bringing the same drug chemistry to the market. Patent trolls actively want people to exploit their patents in order to sue. I'm not sure which is more disagreeable.
They do that sometimes. Other times they discover a drug chemistry, patent it, and then do nothing with it because they decide the market isn't profitable enough. That stops other companies bringing the same drug chemistry to the market. Patent trolls actively want people to exploit their patents in order to sue. I'm not sure which is more disagreeable.
> buy patents
Whose non-existant patent would they buy under the new system where the non-practitioner can't have one to sell? Or I can see you could only let practitioners enforce, but what would be the details on that? The non-practioner could just threaten to become a practitioner or sell to one in exchange for a settlement from someone violating, or if prior violators were grandfathered in once practitioning from the holder began, it would be a race to violate as many as possible before they could be put into practice, in order to get them free through grandfathering.
Whose non-existant patent would they buy under the new system where the non-practitioner can't have one to sell? Or I can see you could only let practitioners enforce, but what would be the details on that? The non-practioner could just threaten to become a practitioner or sell to one in exchange for a settlement from someone violating, or if prior violators were grandfathered in once practitioning from the holder began, it would be a race to violate as many as possible before they could be put into practice, in order to get them free through grandfathering.
An example would we the Biotech/Pfizer vaccine - it could never have finished clinical trials so quickly if patents were not transferrable between companies
It makes literally no difference, as the parent comment already mentioned. You deserve protection for coming up with the technology, not for using it. These patent trolls are one of the methods to support a research program. Universities, for example, aren't set up to sell devices.
As long as the patent is for some actual innovation, there is nothing wrong with this market structure, economically or morally.
As long as the patent is for some actual innovation, there is nothing wrong with this market structure, economically or morally.
> You deserve protection for coming up with the technology, not for using it.
Why? Ideas are cheap, execution is everything and all that. You don't have to literally be the person executing on it, but whoever you transfer or sell the patent to should. I'd be ok with licensing or selling patents to others to build the technology, I'm not ok with licensing or selling the patent to others who will only use it to sue people who do try to build something similar.
The concept of patents was to encourage innovation, not stifle it.
Its also quite common that multiple people invent the same thing at roughly the same time. With these patent trolls, if one of these people gets the invention patented first, but does nothing but rent seeking with it, that will prevent others who came up with the same thing but were too slow to patent it to even try.
Couple that with overly broad, vague or downright invalid patents and you end up with a system that discourages, hinders or puts a large cost on actual innovation. Even if a patent is provably invalid, it costs money in legal fees to get it overturned.
Why? Ideas are cheap, execution is everything and all that. You don't have to literally be the person executing on it, but whoever you transfer or sell the patent to should. I'd be ok with licensing or selling patents to others to build the technology, I'm not ok with licensing or selling the patent to others who will only use it to sue people who do try to build something similar.
The concept of patents was to encourage innovation, not stifle it.
Its also quite common that multiple people invent the same thing at roughly the same time. With these patent trolls, if one of these people gets the invention patented first, but does nothing but rent seeking with it, that will prevent others who came up with the same thing but were too slow to patent it to even try.
Couple that with overly broad, vague or downright invalid patents and you end up with a system that discourages, hinders or puts a large cost on actual innovation. Even if a patent is provably invalid, it costs money in legal fees to get it overturned.
The facts alleged here are that apple is using a patented technology, held by someone else, without licensing it first. And now that this is discovered, the remedy is to have Apple pay the licensing fees for the patent (including retroactively).
Without the ability to sue people infringing on your patent, how do you ensure people will pay to license it?
Without the ability to sue people infringing on your patent, how do you ensure people will pay to license it?
If whoever is holding the patent is not using it for anything other than sue people, then I really don't care that Apple infringed it without licensing.
That sort of goes in the face of your "licensing or selling it to others" above though, right?
Let's say you have a patent. You're trying to get someone to license it. They decide, no, we'd rather just use it for free instead. Now you have no buyers, and no licensors -- what is your option but a lawsuit?
Let's say you have a patent. You're trying to get someone to license it. They decide, no, we'd rather just use it for free instead. Now you have no buyers, and no licensors -- what is your option but a lawsuit?
If you can demonstrate that you were trying to get it into production, then there's nothing wrong with a lawsuit. I mean, maybe there are better solutions (making them more and more expensive to hold the older they get was mentioned by someone). The goal should be to prevent hoarding for the purpose of rent seeking, without intention for ever actually producing anything. That is, that patents are to protect your invention while you implement it, in order to encourage innovation.
But honestly, I'd be happier to just abolish patents altogether.
But honestly, I'd be happier to just abolish patents altogether.
The whole point of the patent program is to give you a boost in using the technology (to encourage you to come up with it in the first place)
A research program that only produces patents for patent trolls seems like a useless research program.
A research program that only produces patents for patent trolls seems like a useless research program.
Useless to the general public, but a great way to collect fees from those infringing.
I wholeheartedly agree with the sentiment that you need to actively use the patent in a product or forfeit all protection.
I wholeheartedly agree with the sentiment that you need to actively use the patent in a product or forfeit all protection.
I'd say actively use or pro-actively license to someone else. If a company can't show that their patents are generating revenue somehow other than lawsuits, the holder should be forced to give the clarinet to a kid who is gonna use it.
So there are a lot of problems that arise either way. Fist, the way it works now, you file for a patent and get approved, you own it for the generic term that applies to everyone, special considerations depending on the type of patent not withstanding. This leaves us with patent trolls, yes.
The alternative: grant a patent but if it not used within some scope of time in some way it becomes public domain or otherwise no longer considered a person's intellectual property. So you go to some company and say "I've solved your problem and I want to license my solution to you" and they tell you either you're going to sell it to them cheap or they'll just wait you out. You either take it or lose the patent in short order and now they can use it free. Now the only people that even own intellectual property are the big guys, and if you don't sell they let you lay fallow until your ownership becomes forfeit. You either sell to them or lose the patent.
I hate patent trolls too, but this alternative is worse. I personally don't like intellectual property in general, I think the best solution is to just not have it. Trade secrets are one thing, making it illegal for someone to reverse engineer something they bought or draw pictures they saw elsewhere in public is a bit absurd.
The alternative: grant a patent but if it not used within some scope of time in some way it becomes public domain or otherwise no longer considered a person's intellectual property. So you go to some company and say "I've solved your problem and I want to license my solution to you" and they tell you either you're going to sell it to them cheap or they'll just wait you out. You either take it or lose the patent in short order and now they can use it free. Now the only people that even own intellectual property are the big guys, and if you don't sell they let you lay fallow until your ownership becomes forfeit. You either sell to them or lose the patent.
I hate patent trolls too, but this alternative is worse. I personally don't like intellectual property in general, I think the best solution is to just not have it. Trade secrets are one thing, making it illegal for someone to reverse engineer something they bought or draw pictures they saw elsewhere in public is a bit absurd.
That is no the whole point, and certainly hasn't been going back to the 18th century at least. It is routine for patent holders to license their patents to manufacturers for production. That would not be possible if inventors had to make the product for commercial sale by themselves. It would render novel inventions by independent inventors untenable. Only big corporations with manufacturing resources would ever be able to patent anything.
Take James Watt for example, Matthew Boulton could just have told Watt to take a hike and started manufacturing improved steam engines by himself. Watt couldn't have afforded to make steam engines independently, and why would any investor bother supporting him with capital if they could just set up production without him too?
The problem is with trivial patents, not patents in general.
Take James Watt for example, Matthew Boulton could just have told Watt to take a hike and started manufacturing improved steam engines by himself. Watt couldn't have afforded to make steam engines independently, and why would any investor bother supporting him with capital if they could just set up production without him too?
The problem is with trivial patents, not patents in general.
Your facts are completely false, and in fact it's easier to bring things to market than it's ever been.
Watts held back progress significantly and steam engine development was hampered by his and others patents until the expired. The steam engine would have been built to pump water out of mines whether patents existed or not.
Watts held back progress significantly and steam engine development was hampered by his and others patents until the expired. The steam engine would have been built to pump water out of mines whether patents existed or not.
Split a company's research from its production and sales departments into two organisations, and one licenses its patents to the other.
You have transformed a structure where one entities invents and produces to a market structure with one where those are separate roles.
You like the former and abhor the later. But from the outside, this change is absolutely meaningless. It's no different than any other make-or-buy decision.
(Note that "sells a license" is exactly the same as "patent trolling".)
All these feelings you people have are based on the idea of "superficial" patents that aren't "real innovation". Which is, indeed, a problem. But it has nothing to do with the above. Assume some actually useful patent, and these objections fall apart.
You have transformed a structure where one entities invents and produces to a market structure with one where those are separate roles.
You like the former and abhor the later. But from the outside, this change is absolutely meaningless. It's no different than any other make-or-buy decision.
(Note that "sells a license" is exactly the same as "patent trolling".)
All these feelings you people have are based on the idea of "superficial" patents that aren't "real innovation". Which is, indeed, a problem. But it has nothing to do with the above. Assume some actually useful patent, and these objections fall apart.
It is not meaningless. The split structure is actually better (if it is genuinely spun off, rather than created as a tax evasion mechanism) because it can licence the technology to multiple entities, which spurs competition among them.
And yet the patents are often not for innovation but are purposefully vague to capture iterative improvements under their umbrella and profit from it. It's nonsense in this actual case but the concept of patent protections would be fine if to your point it was actual innovation. How would you even decide what is or is not innovative though? Any idea not in the patent database already? Patents are going to become trickier as we abstract and build more complexity into the overall ecosystem.
Everyone keeps touting that in the future technology will solve climate change.
Will it? Or will we have to wait for the patent period to expire of said technologies.
Will it? Or will we have to wait for the patent period to expire of said technologies.
I personally consider it morally wrong to deny people from implementing ideas of their own invention.
> All people holding patents need to be innovating with them, or otherwise, lose them after a short period.
A patent only last 15 or 20 years... copyright is a much bigger issue (copyright protection lasts for the life of the author plus an additional 70 years).
A patent only last 15 or 20 years... copyright is a much bigger issue (copyright protection lasts for the life of the author plus an additional 70 years).
Apple are a patent troll company, often using their size and weight to beat down competition. They have stolen functionality at will to make the product they want, and then fought it out in court.
https://en.wikipedia.org/wiki/Apple_Inc._litigation#Trademar...
https://en.wikipedia.org/wiki/Apple_Inc._litigation#Trademar...
Curious: what might the unintended consequences be of making patents non-transferable?
Only entities with the money to defend patents would bother to acquire them. Owning a patent would become useless to small-fry. So only large entities would own patents.
The solution is to stop registering stupid patents, and (this would require a massive effort) invalidate all the stupid patents that are already on file.
Or perhaps, change the law so that if an alleged infringer turns out to have "infringed" an invalid patent, all costs go to the alleged infringer. That would encourage people to fight patent trolls, rather than just roll over.
[Edit] I suppose that would only work if the petitioning NPE were required to deposit a bond with the court.
The solution is to stop registering stupid patents, and (this would require a massive effort) invalidate all the stupid patents that are already on file.
Or perhaps, change the law so that if an alleged infringer turns out to have "infringed" an invalid patent, all costs go to the alleged infringer. That would encourage people to fight patent trolls, rather than just roll over.
[Edit] I suppose that would only work if the petitioning NPE were required to deposit a bond with the court.
For reference the King of all 3G/4G and 5G patents Qualcomm only charge ~$7-$15 per devices depending on how you count the rebate on Modem.
>In 2020, the UK Supreme Court ruled a UK court can set the rate for patent payments worldwide, despite the court only being able to consider the infringement of UK patents. A trial in 2022 will determine how much Apple will have to pay.
From my limited reading I think and correct me if I am wrong that is why the numbers it so large at $7B. It is basically if a patent that is ruled valid in the UK, the company will have to pay the fees for it worldwide, i.e ~250M unit per year and all the past years of infringement. The only way to not have to pay would be to get out of the UK market so the company will have to have its patent on trial in court in every other country.
There is no way that $7B was made solely on the iPhone sold in UK. The numbers just dont add up.
>> I'm not sure that is right. Apple's position is it should indeed be able to reflect on the terms and decide whether commercially it is right to accept them or to leave the UK market. There may be terms that are set by the court which are just commercially unacceptable.
This is not a threat. But a valid argument, which is so rare from Apple. It is not the first time Apple has threaten to leave the market in numerous other occasions such Australia, Germany, or EU.
>In 2020, the UK Supreme Court ruled a UK court can set the rate for patent payments worldwide, despite the court only being able to consider the infringement of UK patents. A trial in 2022 will determine how much Apple will have to pay.
From my limited reading I think and correct me if I am wrong that is why the numbers it so large at $7B. It is basically if a patent that is ruled valid in the UK, the company will have to pay the fees for it worldwide, i.e ~250M unit per year and all the past years of infringement. The only way to not have to pay would be to get out of the UK market so the company will have to have its patent on trial in court in every other country.
There is no way that $7B was made solely on the iPhone sold in UK. The numbers just dont add up.
>> I'm not sure that is right. Apple's position is it should indeed be able to reflect on the terms and decide whether commercially it is right to accept them or to leave the UK market. There may be terms that are set by the court which are just commercially unacceptable.
This is not a threat. But a valid argument, which is so rare from Apple. It is not the first time Apple has threaten to leave the market in numerous other occasions such Australia, Germany, or EU.
When a quasi-monopolist threatens to exit your market ... perhaps the reason why isn't really all that important.
Are you suggesting we stop thinking whenever large corporations are involved?
Sure. On the other hand, this will create societal backlash, not against Apple, but against the government. Tracy needs her iPhone.
Maybe it's time Tracy grew up.
Flippant answer aside, we need governments to learn to stand up more against the superlarge multinational companies that think they can bully their way over what a countries government thinks is good for the population. (I know a whole bunch of hand waving - elected by the people for the people that doesn't always work).
We should applaud a government for standing up though.
Flippant answer aside, we need governments to learn to stand up more against the superlarge multinational companies that think they can bully their way over what a countries government thinks is good for the population. (I know a whole bunch of hand waving - elected by the people for the people that doesn't always work).
We should applaud a government for standing up though.
> what a countries government thinks is good for the population
Sounds like China
Sounds like China
Sounds like what is supposeto happen when we elect officials to do our bidding.
>We should applaud a government for standing up though.
Don't get excited, it's just one Supreme Court justice, who has very little to lose either way. No one has even heard of these guys before. I don't believe that Johnson would have the backbone to do such a thing.
Don't get excited, it's just one Supreme Court justice, who has very little to lose either way. No one has even heard of these guys before. I don't believe that Johnson would have the backbone to do such a thing.
That indeed feels like a great opportunity to create something new :) though I'd rather it happening not because of patent trolls :/
Cute but you forget that countries and municipalities are in competition with each other over attracting business, trillion dollar companies should make good on these threats more often because then they get to come back later for pennies on the dollar
> countries and municipalities are in competition with each other over attracting business
What's the point in attracting a business that doesn't pay any tax... further, I (and many others) would argue Apple has a far less positive impact on it's users than it used to, it has turned into more of a money extracting machine and vehicle for consumption.
In other words, if not having a quasi-monopoly operate in your country is a net positive for society, then who cares if they threaten to leave.
What's the point in attracting a business that doesn't pay any tax... further, I (and many others) would argue Apple has a far less positive impact on it's users than it used to, it has turned into more of a money extracting machine and vehicle for consumption.
In other words, if not having a quasi-monopoly operate in your country is a net positive for society, then who cares if they threaten to leave.
Jobs? Whether from the company directly or third parties
Such as the market for accessories creation and trading
All helps GDP and the local economy
Such as the market for accessories creation and trading
All helps GDP and the local economy
Then let Apple leave the UK.
The UK should be better off.
Both sides are happy.
The UK should be better off.
Both sides are happy.
How much the fees should be and how Apple react to them are separate issues. Given the fact that Apple Retail UK posted a profit of just £39m in 2020 though, it seems likely that they'll have to exit the market as they won't be able afford even a reasonably low patent fee.
Assuming that their reported profit wasn't just a massive lie to avoid tax, obviously.
Assuming that their reported profit wasn't just a massive lie to avoid tax, obviously.
The reported profit is probably a joke, since they devize ways to under-report to pay less tax.
Bad global precedent can be far more expensive and damaging than a mere $39M.
"An estimated 19,452 iPhones were sold every day in the UK in 2019", give them a break, obviously struggling to get traction.
So that's around 7 million phones per year. Assuming around £700/phone and 30% profit (very rough made up numbers), that should be £1.5B/year profit. If the judgement is for £3B to £5B as the article states, I can see why they might decide to exit the UK market. But that only makes sense if they don't then lose the patent cases in other juristictions, and end up having to pay similar royalties anyway.
The £3-5bn fee is a one-off payment (I think..), so you can't really compare it to a single year's profit. It'd need to be amortized against the lifetime of all the iPhone products that are covered by the patent.
I'm not sure that leaving the market will absolve Apple of paying the judgement, so staying in the UK market will help them recoup the cost. Leaving would be unlikely to improve their bottom line, so the judge was right - no evidence Apple will leave. This is just posturing, which won't go down well in front of a High Court judge.
I think the intent would be to avoid paying the fine. Without assets, revenue, or profit the UK wouldn’t have anything to seize to pay the levy.
The judgement holder could then attempt to go after Apple in other countries, but I think that would result in a court case about whether that’s possible or not.
The judgement holder could then attempt to go after Apple in other countries, but I think that would result in a court case about whether that’s possible or not.
Why would Apple pay the fine?
Exactly, they don’t seem to respect others’ legally enforceable IP, the engage in tax avoidance schemes…why would Apple pay a court ordered judgment for damages? Wait is that not what you meant?
To avoid their executives going to prison.
Their executives in the US? Going to trial in the UK, where the company would no longer do business? How does that work, exactly? Has the US ever extradited a white collar criminal?
They have executives in the UK.
Why would they have executives in a country that they don't do business in?
They do do business in the UK, as you well know.
They wouldn't if they were fined, as the headline and article clearly state.
In 2020, the UK was still part of the EU and with that Apple could and did move much EU based sales to Ireland for tax purposes. So with that in mind, along with how companies game the tax systems, I take any figure with a pinch of salt.
That said Apple postulating this as retaliation to a legal court case pertaining to a valid patent, does seem a bit purile.
But the real question I have is - if these are core patents as they seem to be (not read the patents but mention of 3g and 4g connectivity mooted) then I would of thought FRAND would take presedense
https://en.wikipedia.org/wiki/Reasonable_and_non-discriminat...
That said Apple postulating this as retaliation to a legal court case pertaining to a valid patent, does seem a bit purile.
But the real question I have is - if these are core patents as they seem to be (not read the patents but mention of 3g and 4g connectivity mooted) then I would of thought FRAND would take presedense
https://en.wikipedia.org/wiki/Reasonable_and_non-discriminat...
Apple's profits fetch up in some tax-haven, as far as I'm aware. They have a problem, because they hold so much cash in tax-havens, that they can't repatriate without incurring enormous tax liabilities.
So yes, the reported profit was just a massive lie.
So yes, the reported profit was just a massive lie.
It seems like this is the part that most offends Apple:
“* In 2020, the UK Supreme Court ruled a UK court can set the rate for patent payments worldwide, despite the court only being able to consider the infringement of UK patents.*”
If every country took that approach that the UK Court seems to be taking, international trade would suffer greatly.
“* In 2020, the UK Supreme Court ruled a UK court can set the rate for patent payments worldwide, despite the court only being able to consider the infringement of UK patents.*”
If every country took that approach that the UK Court seems to be taking, international trade would suffer greatly.
This is not for patent disputes in general, only disputes involving standard essential patents (SEPs), which these are. The court took standards setting organisation powers to decide fair, reasonable, and non‑discriminatory (FRAND) terms for global application. FRAND licences are global by their nature, so we shouldn't be surprised that the Supreme Court asserted this in its decision.
This isn't UK over-reach, but an application of international standard approach, afaict.
This isn't UK over-reach, but an application of international standard approach, afaict.
The quote in the article didn’t read like a threat to me. I don’t have the full context, but the quote from Apple’s lawyer is:
> I'm not sure that is right. Apple's position is it should indeed be able to reflect on the terms and decide whether commercially it is right to accept them or to leave the UK market. There may be terms that are set by the court which are just commercially unacceptable.
Perhaps that’s diplomatic lawyer-speak for “we’re leaving and taking our ball with us” (any lawyers please do comment), but as an outsider I don’t see it.
> I'm not sure that is right. Apple's position is it should indeed be able to reflect on the terms and decide whether commercially it is right to accept them or to leave the UK market. There may be terms that are set by the court which are just commercially unacceptable.
Perhaps that’s diplomatic lawyer-speak for “we’re leaving and taking our ball with us” (any lawyers please do comment), but as an outsider I don’t see it.
When I read "patent company" I can't help but understand it as "patent troll".
A company specialized in making money from patents can't be any good...
A company specialized in making money from patents can't be any good...
Hmm, I wonder what the patents are about.
The article implied that it was for 3g and 4g radio-related patents.
A slightly-critical point, which seems 99.9% ignored here. I found an article - https://www.iphonehacks.com/2021/07/apple-threatens-exit-uk-... - saying "A UK high court judge has ruled that Apple has infringed on two patents of Optis Cellular.". But nothing more.
If the 2 patents are "good quality" - really novel, not a bit obvious to actual experts in that niche (at the time), etc. - then the reasonable (morally, not legally) argument would be about what is a fair rate for Apple to pay to use them.
If the 2 patents are "the usual patent system abuse crap" - vague walls of buzzwords, prior art but with "using $NameOfNewTechnology" inserted in a bunch of places, or such - then the reasonable argument (again morally) would be about why our wretched legal and patent systems are so badly infested with such toxic swill.
But Apple's seeming threat to exit the UK market makes for a lot of drama, and that's mostly what people care about.
If the 2 patents are "good quality" - really novel, not a bit obvious to actual experts in that niche (at the time), etc. - then the reasonable (morally, not legally) argument would be about what is a fair rate for Apple to pay to use them.
If the 2 patents are "the usual patent system abuse crap" - vague walls of buzzwords, prior art but with "using $NameOfNewTechnology" inserted in a bunch of places, or such - then the reasonable argument (again morally) would be about why our wretched legal and patent systems are so badly infested with such toxic swill.
But Apple's seeming threat to exit the UK market makes for a lot of drama, and that's mostly what people care about.
I'm not a fan of patent trolls, and I don't generally like intellectual property or how it is implemented, but this is a bad look for Apple. A court does "justice" according to it's own law and a party in the court tries to throw it's weight around to get the country to not enforce it's own law on them. This is a huge company trying to be above the law.
I suggest register patents -- so that they become public knowledge
Then anybody can implement it; there is no restriction
Then there is a preset scale, partly set by the value the inventor gives to the invention, but also set by supply and demand. So the inventor cannot price themselves out of the market, but still has incentive to publish. Possibly a market place where companies make non exclusive bids
Patent '''trolls''' are a separate issue
Probably the best solution is for litigants who loose; to pay a more realistic evaluation of damages for the court case to those who successfully defend themselves. This would include paying above damages, because presumably those who defended themselves should be paid for the extra work forced on them, etc
Alternatively for low to zero value patents, where a few years have elapsed, the onus first falls on the patent holder to demonstrate its worth
Then anybody can implement it; there is no restriction
Then there is a preset scale, partly set by the value the inventor gives to the invention, but also set by supply and demand. So the inventor cannot price themselves out of the market, but still has incentive to publish. Possibly a market place where companies make non exclusive bids
Patent '''trolls''' are a separate issue
Probably the best solution is for litigants who loose; to pay a more realistic evaluation of damages for the court case to those who successfully defend themselves. This would include paying above damages, because presumably those who defended themselves should be paid for the extra work forced on them, etc
Alternatively for low to zero value patents, where a few years have elapsed, the onus first falls on the patent holder to demonstrate its worth
I wish more companies would have the guts to fight all these crazy government requests and regulations. Let the people choose if they want to lose the services they rely on so that some politician has a glory bulletpoint on his CV.
Alas, the money is too sweet and hard to say no to...
Alas, the money is too sweet and hard to say no to...
Similarly I wish more democratic governments would have the guts to fight all these crazy corporate monopolies. Let the people choose if they want to allow unstifled innovation rather than rely on sneakily created monopolies, so that some CEO has another bonus this year.
Alas, the lobby money is too sweet and hard to say no to...
Alas, the lobby money is too sweet and hard to say no to...
> Apple threatens UK market exit if court orders 'unacceptable' patent fees
Yes, please.
Yes, please.
Thy should be happy with a charge of 30% of gross sales, it is their industry standard.
Apple aint throwing away a multi billion pound market so cheaply (relatively speaking, of course and "aint" is a real word)
The UK has a relatively strong chance of creating decent competitive challengers to Apple if the UK market opens up with their exit. Even if a few consumers are frustrated in the short term this could lead to a fantastic outcome for a competitive consumer marketplace over the long-term.
Reading https://www.techradar.com/uk/news/apple-app-store-was-a-majo...
I'd say it is not so much the consumers that would be impacted by such a hissy fit that Apple has mooted.
Of course, that's a claim from Apple in response claims of anticompetitive behaviour.
I find it difficult to believe, as a mobile developer myself, that 330,000 jobs are being supported by the App Store in any meaningful way.
I find it difficult to believe, as a mobile developer myself, that 330,000 jobs are being supported by the App Store in any meaningful way.
Sounds about right to me.
Fermi estimate:
apps-not-abandoned * average-developers-per-app-this-year ~> 2 million apps * 2 developer-months ~> 333,000 developers
Fermi estimate:
apps-not-abandoned * average-developers-per-app-this-year ~> 2 million apps * 2 developer-months ~> 333,000 developers
UK jobs.
I know "meaningful" isn't well-defined, but more than 1% of the entire UK workforce is not dependent on the App Store (that couldn't be replaced by any other app marketplace)
I know "meaningful" isn't well-defined, but more than 1% of the entire UK workforce is not dependent on the App Store (that couldn't be replaced by any other app marketplace)
Ah, I missed that. That does make a difference, and I could only justify it in the unlikely event of a decent percentage of those apps being for businesses specifically dependent on iOS apps in particular rather than mobile phones and websites in general.
It will never happen. Just have to count the number of iphones and macs in the hands of people with power.
Also it’s a nearly free victory to anybody challenging the incumbents in power at the time. Imagine being one of the people on duty when Apple (a hugely popular consumer brand) pulls out of your country. Hard to explain that one to the constituency and come out looking good.
We'd have new legislation within a week targeting patent trolls. I can't imagine anything that'd make a government more unpopular than taking away everyone's iPhones, iPads and Macs.
Yeah Apple has a far bigger marketing budget than any politician.
A politician could be correct that 1+1=2, but Apple will twist your emotions until you cave.
Or at least that works on some people.
A politician could be correct that 1+1=2, but Apple will twist your emotions until you cave.
Or at least that works on some people.
Please allow me a hearty, LOOOOOOOL.
And I'm not really a fan of Apple either, but still.
And I'm not really a fan of Apple either, but still.
I don’t know about your politics, but regardless, “the UK will be able to build an Apple competitor” sounds like a level 99 brexiteer delusion.
Imagining a change in the tech landscape isn't that absurd. If there's a vacuum in the market, do you not think there are capable technology startups in the UK that could fill it?
Someone did try: https://wileyfox.com/
Made in China, obviously, but British labelling and marketing. They lasted a few years before bankruptcy.
I think if apple somehow did exit the UK the replacement would be (a) black market iphones and (b) all the other Android manufacturers.
Made in China, obviously, but British labelling and marketing. They lasted a few years before bankruptcy.
I think if apple somehow did exit the UK the replacement would be (a) black market iphones and (b) all the other Android manufacturers.
I expect any change in the marketplace that a startup could fill is one where Apple is already non-dominant, and therefore not preventing a vacuum by occupying. Worse, in the hypothetical where Apple left the UK in order to not be bound by a UK-specific IP infringement judgment, Apple would be have greater liberty to just fire up the metaphorical photocopier.
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We have tons of opportunities in the UK to build a mobile firm. ARM is based here, for starters.
Unfortunately with Brexit it has become fashionable in certain quarters to 'do-down' the UK's capabilities.
Unfortunately with Brexit it has become fashionable in certain quarters to 'do-down' the UK's capabilities.
Like I said in another comment, the high-end consumer mobile market outside of Apple is a red ocean and I seriously doubt the UK would be able to build a global scale corporation commanding ludicrous margins like Apple.
> with Brexit it has become fashionable in certain quarters to 'do-down' the UK's capabilities
It has also certainly become fashionable in other quarters to 'do-up' the UK's capabilities.
I don't deny that the UK has technological clout beyond digital, with excellent universities, a great tradition in science and engineering, and a global hub in London.
But a competitor to Apple? Come on.
> with Brexit it has become fashionable in certain quarters to 'do-down' the UK's capabilities
It has also certainly become fashionable in other quarters to 'do-up' the UK's capabilities.
I don't deny that the UK has technological clout beyond digital, with excellent universities, a great tradition in science and engineering, and a global hub in London.
But a competitor to Apple? Come on.
Time for the great Dana Sibera (https://twitter.com/NanoRaptor) to make some wondrous alternate history pictures of a world where there was a BBC Micro smartphone, or a ZX tablet.
> We have tons of opportunities in the UK to build a mobile firm. ARM is based here, for starters.
Unfortunately with Brexit it has become fashionable in certain quarters to 'do-down' the UK's capabilities.
The problem with building a mobile firm is that it's extremely expensive capital wise, and difficult.
There has not been an effective new entrant in the market globally in quite some time. It is not "doing the UK down" to suggest that there is no opportunity here for someone who doesn't already do high end phone manufacturing, and it's worth noting that the margins for everyone else in the mobile market are pretty crummy actually.
The problem with building a mobile firm is that it's extremely expensive capital wise, and difficult.
There has not been an effective new entrant in the market globally in quite some time. It is not "doing the UK down" to suggest that there is no opportunity here for someone who doesn't already do high end phone manufacturing, and it's worth noting that the margins for everyone else in the mobile market are pretty crummy actually.
Apple only licenses the ARM ISA, ARM core designs are way behind the Apple ones.
I can certainly imagine the UK doing well in some tech niches, but not in high-end, global scale consumer electronics like Apple, no.
The high-end mobile phone market outside Apple is a shark-infested red ocean to start with. Then there's the fact that even if Apple stopped operating in the UK, you'd still have to compete with them globally.
I cannot foresee a Black Swan event like a random dude from the Midlands becoming the next Steve Jobs, but other than that I don't think it's worth entertaining that there will be a real British contender to the American trillion dollar mastodon.
The high-end mobile phone market outside Apple is a shark-infested red ocean to start with. Then there's the fact that even if Apple stopped operating in the UK, you'd still have to compete with them globally.
I cannot foresee a Black Swan event like a random dude from the Midlands becoming the next Steve Jobs, but other than that I don't think it's worth entertaining that there will be a real British contender to the American trillion dollar mastodon.
To be fair, a random dude from Essex designed the original iMac, iPod and most Apple devices thereafter.
The British create and design around ideas but don't have the capital markets, the scale, or the will to leverage them globally.
They end up selling themselves and their ideas to the world who then go on to really capitalise on them.
Being generous, Britain is a design hub at best.
They end up selling themselves and their ideas to the world who then go on to really capitalise on them.
Being generous, Britain is a design hub at best.
But Americans capitalized on it, and it’s not a coincidence.
Using a British chip architecture.
I don't think a sudden Apple competitor is at all likely to appear either, but not from any country, nothing really significantly making it more or less likely from the USA or UK (or Germany or Canada or ...) IMO.
With the exception I suppose that perhaps it is more likely from China than anywhere, public perception really soured but you could imagine Huawei (or Xioami or whatever) phones could've gotten popular. (They can never seem to get fonts and branding 'right' though? I don't understand why they don't hire 'western' branding consultants, even dirt cheap students, just to get some feedback on the way things look. It wouldn't take much to be able to charge a lot more for the obviously identifiable tat on Amazon (and also all over AliExpress).)
I don't think a sudden Apple competitor is at all likely to appear either, but not from any country, nothing really significantly making it more or less likely from the USA or UK (or Germany or Canada or ...) IMO.
With the exception I suppose that perhaps it is more likely from China than anywhere, public perception really soured but you could imagine Huawei (or Xioami or whatever) phones could've gotten popular. (They can never seem to get fonts and branding 'right' though? I don't understand why they don't hire 'western' branding consultants, even dirt cheap students, just to get some feedback on the way things look. It wouldn't take much to be able to charge a lot more for the obviously identifiable tat on Amazon (and also all over AliExpress).)
> Imagining a change in the tech landscape isn't that absurd. If there's a vacuum in the market, do you not think there are capable technology startups in the UK that could fill it?
No.
Samsung, Huawei and Sony would fill it.
There is no UK company that has the scale to be able to deliver a competing product before those companies absorb all the available market share.
No.
Samsung, Huawei and Sony would fill it.
There is no UK company that has the scale to be able to deliver a competing product before those companies absorb all the available market share.
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It would create quite a power vacuum, and it would scare people in other countries as well.
But I'm not convinced that it would cause a new competitor to exist. I think it's more likely that existing companies will eat up that market instead, and I don't think there are any UK companies poised to take over that market segment.
But I'm not convinced that it would cause a new competitor to exist. I think it's more likely that existing companies will eat up that market instead, and I don't think there are any UK companies poised to take over that market segment.
People will simply import iPhones from elsewhere, or buy Samsungs instead.
"People will simply import iPhones from elsewhere" is not an option - if there's a patent decision, then it would also mean that imports are a patent violation, all iPhones would have to be seized at the customs. Not-for sale items in personal luggage might be exempt, but bringing a new iPhone in a box for someone else would literally be contraband in this situation.
Fortunately the UK has an open land border with Ireland. Pop over to Belfast, train to Dublin.
(Apple make €110bn profit in Ireland according to their accounts. There is no Dublin Apple Store.)
(Apple make €110bn profit in Ireland according to their accounts. There is no Dublin Apple Store.)
Well yes but smuggling is a very old occupation for a reason. People won't follow a law they think is illegitimate when they feel they can get away with it. So it would work like the war on drugs. Cocaine is very common for a consumable "not an option" for importing.
Hell that same circumstance of personal use is how the underground USSR blue jeans market came about!
Hell that same circumstance of personal use is how the underground USSR blue jeans market came about!
Brexit really helps the UK’s leverage here. As the dominant economy in Europe, the UK can unilaterally set policies and reasonably expect multinational companies to comply with them. Their threats bear real weight. If I were Tim Apple, I’d be experiencing existential terror right now.
The dominant economy in Europe is Germany. The UK has more or less the same GDP as France.
https://en.wikipedia.org/wiki/List_of_sovereign_states_in_Eu...
https://en.wikipedia.org/wiki/List_of_sovereign_states_in_Eu...
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Just because it's targeting Apple doesn't make it right. Companies of this type should be illegal. A patent is a government-sponsored monopoly which shouldn't be "pooled" by "patent companies" whose only purpose is to use the state to extract money from companies actually producing goods.
All people holding patents need to be innovating with them, or otherwise, lose them after a short period.