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Meeting of the Larrys: Larry Page and Larry Ellison, CEOs of Google and Oracle met, but were unable to work out a mutually acceptable Java licensing arrangement for Oracle.  (Source: Business Insider/The New York Post)

Google could remove Java from the Android project, leaving an interface that partners who license J2ME could plug the technology into. That would be okay for Samsung, Motorola, LG Electronics, and Sony who are all J2ME licensees, but it could hurt HTC, the second largest Android manufacturer.  (Source: Linux Tux)
Settlement talks reach impasse; Oracle demands double-dip licensing fees on the OS and handset levels

Bloomberg reports that another round of talks between software giants Google Inc. (GOOG) and Oracle Corp. (ORCL) ended at an impasse.  Oracle Corp. is currently suing Google for using pieces of its patented Java2ME (J2ME) code in Android via the Apache Project's Java Standard Edition "Harmony" (J2SE).  

Google CEO Larry Page sat with Oracle CEO Larry Ellison for 10 hours trying to work out an acceptable licensing agreement.  The talks ended with no deal reached, with both parties agreeing to talk to court officials about "when further discussions will take place and whether the further attendance of Mr. Ellison and Mr. Page will be required."

I. Oracle's Plan For Double-Dip License Fees

The case represents a substantial risk for both firms.

Working in Oracle's favor is the fact that the judge has suggested that Google's infringement of the Java technology 
was "brazen".  But Google has some advantages of its own.  It dug up documents from the former CEO of Sun Microsystems -- the company Oracle acquired the Java intellectual property from in 2010 -- praising Google's use of Java in Android, and casting doubt on whether Sun was opposed to the unpaid use.  

Furthermore, Google succeeded in convincing the judge to toss out the $6.1B USD that Oracle wanted -- a figure which included speculative future damages.  Oracle has since revised its estimate downwards to $2.3B USD, a figure that still includes a $1.2B USD speculative damages total for 2012, which Google contends is unfair.

If the pair can't settle up, the case will likely go to trial.  If that happens Oracle will be seeking one thing -- a permanent injunction banning U.S. Android sales.  Unlike Apple, Inc. (
AAPL) who is seeking a similar injunction in hopes of permanently preventing U.S. Android sales, Oracle's "permanent" injunction bid would be in hopes of forcing Google into a lucrative licensing deal.  Oracle could ask for a royalty as high as $15-20 per device license, on top of the identical fee it already charges Android handset makers like Samsung Electronics Comp., Ltd.'s (SEO 005930).

This is an important aspect to understand of why Oracle's campaign is more harmful to Android, than Microsoft's licensing efforts -- Oracle is double-dipping, seeking fees both at the OS and handset levels, where as Microsoft is content to stick with handset licensing.

Google offers Android licenses to handset manufacturers for free, though it does earn a certain amount of revenue via its cut of app sales and Android-targeted licensing.  The question becomes how much of that revenue can Oracle take before Android starts to become a losing proposition for Google.

If Google is unable to beat Oracle in court, it will surely regret rejecting Sun's 2006 offer to license Java2ME to Android for $100M USD.

II. Google Could Remove Java from Android

One possible way Google could shirk the licensing fees, though, is to remove all the J2SE/J2ME code, leaving a naked interface for partners to implement their own build of J2ME.  As most Android partners -- such as Samsung and Google subsidiary Motorola Mobility – are J2ME licensees, Oracle likely couldn't do anything about this scheme.  The one major player who would be hurt by such an arrangement would be HTC Corp. (SEO:066570).  The Taiwanese manufacturer, believed to be the second largest Android handset maker, does not license J2ME.  Thus it would likely be summarily sued by Oracle, should it try to plug in the technology.

If Google adopts such a strategy (and there's no clear reason why it wouldn't other than to protect HTC), it would still have to pay the damages for past infringement, but it would be spared from the ongoing double-dip licensing scheme.  That would mean a big loss for Oracle, as the license fees comprise the majority of the money Oracle hopes to pocket in future years as a result of the case.

One thing to recall is that Google is sitting on a $39B USD cash surplus [source], so it can afford to stomach some damages.  But licensing fees?  Those it should be far more concerned about, as they affect its ongoing bottom line.

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RE: Confusing
By JasonMick on 9/23/2011 12:12:23 PM , Rating: 2
Your article is written from the perspective that Oracle's claim is correct and has been proven. Android's Java library doesn't even include any of the ME classes.

It really seems like you don't really understand the technology here and have jumped to conclusions that the available evidence doesn't warrant.

Of course if Google wins the situation will be different, but the judge in the case already suggested Google "brazenly" infringed on Oracle's IP, so a victory is looking pretty unlikely.

As is, there's headers in J2SE that match J2ME exactly. And there's emails indicating that those close to the project knowingly copied them. What's there not to understand about that?

Did you work on the J2SE project? How is your knowledge in this matter superior to mine?

Do I think Oracle's claims are fair? No. I'm against software patents in general. But they are (sadly) the law of the land and Google appears to be in a bad spot here.

What I point out in the article is an easy out for Google, should it lose in court (which again, as I said, looks pretty likely).

RE: Confusing
By xype on 9/23/11, Rating: -1
RE: Confusing
By JasonMick on 9/23/11, Rating: 0
RE: Confusing
By xype on 9/23/11, Rating: 0
RE: Confusing
By jhb116 on 9/23/2011 7:11:24 PM , Rating: 2
agreed, however, it would appear that this case will take some time to work through. If Google was smart - they would assume that the case will be lost and start coding it out now. Maybe they could offer to purchase WebOs from HP or get Symbian now that Nokia has abandon it. Java was a great concept ruined with licensing, I have no doubt that Oracle will make that situation worse. Google should segregate itself from Oracle as much as possible....

RE: Confusing
By Some1ne on 9/24/2011 8:42:42 PM , Rating: 4
What are these "headers" you keep talking about? There are no header files in Java. The only possible exceptions are a small handful of system utilities that are implemented in a compiled language for performance reasons, and the implementation of the Java VM itself.

However, the Java Runtime Environment and core library is implemented almost entirely in Java, and thus has no header files for anyone to copy, infringe upon, replace, or "drop in".

RE: Confusing
By Flunk on 9/23/2011 1:30:00 PM , Rating: 2
I'm not saying Google is correct, I believe that they do infringe on Oracles copyright because they don't have a TCK license.

J2SE predates J2ME by many years, the headers are not copied from J2ME but rather the other way around. J2ME was designed as a subset of J2SE with some added classes for mobile applications. This is all very common knowledge amount Java Programmers.

Don't bring patents into this, this particular issue is over intellectual property.

My argument is not that Google is right, just that you have a lot of the technical details totally wrong. Google tried to create a Mobile Java version that didn't infringe on the J2ME framework in the first place, since Oracle sued them anyway that idea didn't seem to work. Suggesting that they "drop J2ME" now is nonsensical.

RE: Confusing
By NellyFromMA on 9/23/11, Rating: 0
RE: Confusing
By Horizon79 on 9/23/2011 4:02:58 PM , Rating: 2
Patents are part of this battle. There are 7 patents that Sun had are being infringed by Google's Dalvik - Oracle claims. You can read about those patents here -,_U...

“Then they pop up and say ‘Hello, surprise! Give us your money or we will shut you down!' Screw them. Seriously, screw them. You can quote me on that.” -- Newegg Chief Legal Officer Lee Cheng referencing patent trolls

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