Google and Samsung have become the latest tech companies to voice concerns that Microsoft’s takeover of Nokia’s handset business will result in higher parent licensing fees.
According to Bloomberg, the two have asked China’s Ministry of Commerce to ensure that the deal doesn’t result in higher fees for wireless technology.
Chinese manufacturers Lenovo, ZTE and Huawei have previously said they were worried the deal could increase Microsoft’s power over the smartphone market and that it may abuse its patents.
Currently, Nokia is charging a small number of Chinese phone manufacturers around two percent on the value of a device, adhering to a loose system for patent protection in the country. However the fear is that once Microsoft completes the takeover, it will either charge higher fees or demand official licensing contracts.
Microsoft believes that Android infringes a number of its patents and has spent the last few years aggressively pursuing individual licensing deals with manufacturers which rely on the operating system, rather than Google itself. These include Samsung, Acer, HTC and Foxconn, which claims it has protected all of its clients from legal action – not insignificant given that it manufactures 40 percent of the world’s consumer electronic devices.
Chip manufacturer Qualcomm is currently the subject of an antitrust probe in China over claims that it is abusing its dominant market position to overcharge on licence fees in the country. If found guilty, the company faces an up to $1 billion fine.
What do you know about IT in China? Take our quiz!
Bad news for Tim Cook, as Counterpoint records 19 percent fall in iPhone sales in…
TikTok pledges to challenge 'unconstitutional' US ban in the courts, after President Joe Biden signs…
British regulator invites feedback on major partnerships Microsoft and Amazon have struck with smaller AI…
Another 20 staff have been fired by Google over Israel protest and their “completely unacceptable…
Censorship row brewing down under, after the Australian Prime Minister calls Elon Musk an 'arrogant…
Financial regulator asks New York judge to impose $5.3 billion in fines against Terraform Labs…
View Comments
As Nokia is the divesting firm; and the Chinese review is supposed to be an anti-trust anti-monopoly review, it would be highly unusual to place any burden on Nokia. The Chinese may attempt to impose more burden on Msft as the enlarging entity...but with windows phone at 3% of the Chinese market, Msft is far from having a dominant market share pursuant to even Mofcom's own definition of what constitutes 'dominant' market share.
China's Mofcom's mandate does not extend to patents. Not all monopolies are illegal, patents and IP being case in point..they are legal monopolies granted for a limited duration to encourage innovation, something the Chinese has recently said they wish to encourage thru stronger IP enforcement. China has its own patent office and IP courts with appropriate jurisdiction that are better equipped to deal with any future patent issues that may arise. Here the issue is moot as Nokia has largely supported FRAND pricing for its standard essential patents and it has been widely acknowledged to be one of the weaker IP enforcers to date.
Moreover, you cannot preemptively limit a company's property rights for something they have not yet in fact done. If mofcom does in fact impose patent limitations on Nokia, then the WTO, US and EU needs to seriously examine any such decision for restraint of trade and protectionism by the Chinese in the guise of anti-trust regulation; and take appropriate retaliatory trade sanctions. 15 Countries have already approved this deal without restrictions...for the simple reason that there are NO anti-trust issues existent. It is the height of hypocrisy to use regulatory approval as disguise for domestic trade protectionism, especially in this case where a company is divesting and in fact exiting altogether from an industry.