Our Licensing Deal with Samsung: How IP Drives Innovation and Collaboration

Today, Microsoft announced a patent cross-licensing agreement with Samsung that will provide coverage under Microsoft’s patent portfolio for Samsung’s mobile phones and tablets. The agreement also gives both companies greater patent coverage relating to each other’s technologies, and opens the door to a deeper partnership in the development of new phones for the Windows Phone platform.

In the context of all the attention intellectual property matters have received in recent months, it’s worth taking a moment to reflect on the meaning and impact of these agreements. The Samsung license agreement marks the seventh agreement Microsoft has signed in the past three months with hardware manufacturers that use Android as an operating system for their smartphones and tablets. The previous six were with Acer, General Dynamics Itronix, Onkyo, Velocity Micro, ViewSonic and Wistron.

Together with the license agreement signed last year with HTC, today’s agreement with Samsung means that the top two Android handset manufacturers in the United States have now acquired licenses to Microsoft’s patent portfolio. These two companies together accounted for more than half of all Android phones sold in the U.S. over the past year. That leaves Motorola Mobility, with which Microsoft is currently in litigation, as the only major Android smartphone manufacturer in the U.S. without a license.

These agreements prove that licensing works. They show what can be achieved when companies sit down and address intellectual property issues in a responsible manner. The rapid growth of the technology industry, and its continued fast pace of innovation are founded on mutual respect for IP. Intellectual property continues to provide the engine that incentivizes research and development, leading to inventions that put new products and services in the hands of millions of consumers and businesses.

We recognize that some businesses and commentators – Google chief among them – have complained about the potential impact of patents on Android and software innovation. To them, we say this: look at today’s announcement. If industry leaders such as Samsung and HTC can enter into these agreements, doesn’t this provide a clear path forward?

Some carriers have called for companies to enter into precisely these types of agreements to address the patent issues that are important to the mobile marketplace. This clearly makes sense. This is how companies have dealt with prior patent issues relating to radio and media technologies for mobile devices. As today’s announcement illustrates, we have now done this for software technologies as well, and we’re committed to entering into similar agreements with other handset manufacturers.

There undoubtedly will be a good deal of additional drama before this new generation of patent issues sorts itself out in its entirety. But as all of our agreements illustrate, a solution is increasingly in sight. Put in this context, today’s announcement does not yet represent the beginning of the end for this industry-wide assortment of issues. But to borrow a well-known phrase, perhaps we’ve now reached the end of the beginning.

About the Author

Executive Vice President & General Counsel and Corporate Vice President & Deputy General Counsel, Microsoft