According to a statement yesterday, Samsung and Google have “furthered their long-term cooperative partnership with a global patent cross-license agreement covering a broad range of technologies and business areas.” The agreement covers existing patents and those filed over the course of the next decade.
It’s being hailed by some as a breakthrough. However that remains to be seen. Unless or until Apple and Microsoft/Nokia enter into similar agreements we can expect the global patent litigation frenzy to continue.
The agreement is really no surprise. Google and Samsung are close partners in Android — though also rivals.
Samsung is the world’s dominant Android manufacturer and historically has been ambivalent about Google. Samsung would prefer using a proprietary operating system to Android if it could. That’s not possible for the foreseeable future at the very least. For its part, Google seeks a hedge against Samsung’s total domination of the Android market.
Google’s Motorola Mobility has received favorable reviews for its new Moto X and Moto G handset. However neither has made major sales or share gains for the company. Google’s Nexus line (most recently featuring LG handsets) has traction, although nothing approaching the Samsung juggernaut.
Google’s best hope for Samsung competition probably lies in low-cost Chinese handset makers such as ZTE and Huawei, which together with the iPhone have put pressure on Samsung profits recently. An anticipated larger iPhone 6 may also further pressure Samsung in developed markets such as the US.
Part of the joint statement issued by Samsung and Google points to industry wide benefits if patent disputes can be resolved through cross-licensing: “Samsung and Google are showing the rest of the industry that there is more to gain from cooperating than engaging in unnecessary patent disputes.”
The companies thus hope this will be a model for potential deals with Apple and Microsoft. However Redmond and Cupertino probably have other ideas.
Postscript: Samsung and Ericsson have entered into a similar cross-licensing agreement. This one however will see considerable money (more than $600 million) change hands in favor of the Swedish company.