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License or pay settlement, that's what Microsoft's lawyers are telling China's Huawei

Microsoft Corp. (MSFT) has drawn a great deal of flack from critics like Google Inc. (GOOG) for trying to force licensing on Android handset makers.  

The company insists that it’s merely trying to protect its inventions.  However, some question the fact that it's trying to force both manufacturers and OEMs to pay two separate fees on every Android device, in essence double-dipping on licenses.  Others point to the fact that some of its patents are on seemingly obvious software, such as loading images before text or displaying an animated loading icon when loading internet images.  These patents were largely granted during the lax late 90s and early 00s period at the U.S. Patent and Trademark Office.

The latest victim of Microsoft's patent wrath is Chinese telecommunications giant Huawei.  Rather than choose Microsoft's Windows Phone 7 platform, Huawei -- like most other manufacturers -- opted to primarily back Google's free, advertising supported Android platform.

In an interview with The Guardian, Huawei's chief marketing officer Victor Xu confirms that Microsoft is lusting after his company's Android profits.  He comments, "Yes, Microsoft has come to us.  We always respect the intellectual property of companies. But we have 65,000 patents worldwide too. We have enough to protect our interests. We are a very important stakeholder in Android."

Huawei Vision
Huawei is among the biggest Chinese Android OEMs. Pictured: Android 2.3 "Gingerbread" Huawei Vision [Source: Huawei via the Guardian]

Thus far Microsoft has forced two of the three largest Android handset manufacturers -- HTC Corp. (TPE:2498) and Samsung Electronics Comp., Ltd. (KS:005930) -- into licensing agreements, along with a host of smaller sellers [1][2][3].  Samsung was arguably the biggest surprise, as it was an industry veteran with thousands of patents which some believed would be enough to offer it protection from the licensing demands.

Shenzhen-based Huawei has seen most of its past revenue from mobile network infrastructure sales.  The company is the world's second largest maker of mobile network infrastructure behind Sweden's Ericsson SpA (STO:ERIC B) and ahead of France's Alcatel-Lucent (EPA:ALU) and Nokia Siemens (a joint venture between Finland's Nokia Oyj. (HEL:NOK1V) and Germany's Siemens AG (ETR:SIE)).  

But Huawei has grand aspirations for dominating the smartphone market, as well.  Mr. Xu states, "Over the next three years we are aiming to be in the top five smartphone makers, and in the top three in the next five years.  We have established very aggressive targets in the market."

Huawei Girl
Huawei dreams of becoming a top phonemaker. [Source: VR-Zone]

Huawei indicates that "negotiations are in progress" regarding a licensing agreement with Microsoft.  Huawei is looking to aggressively expand worldwide, so it must be wary of the more pro-plaintiff intellectual property atmospher outside of China.

Source: Guardian

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Yeah keep dreaming Huawei
By anactoraaron on 11/8/2011 12:55:09 PM , Rating: 1
So you want to be in the top three Android makers in five years? Let's look at where you are now...

You have only 2 android phones that have a 5MP camera- which even then are junk and the rest have your standard 3.2MP camera which is so bad you should just leave it off the phone entirely (I owned a Tmo Comet for a week and returned it).

You don't have any dual core offering here in the US yet (supposedly the glory is on it's way- we'll see) and nothing 4g announced and I can't find any info on anything 4g even in the works as of now. You only seem to be playing a 'barely passable as a phone' and 'catch up' game to your competition now. Not exactly the way to the top.

Lastly, your phone screens is where you seem to be cutting costs at the most. THEY SUCK. BAD. Literally people who look at your phones after seeing SAMOLED and the higher quality screens that are on every phone made by your competition will be put off by whatever you have to offer. The screen is the most important thing in a smart phone- it's what you look at and use the most.

If you are the last to put out a quality product you will never win any tech race to the top. Examples: WP7 (a true quality phone OS- just the last to the game), Nvidia not getting out Fermi when AMD released the HD 5xxx series (and only relatively recently getting out what Fermi should have been) I can go on and on...

RE: Yeah keep dreaming Huawei
By spaced_ on 11/9/2011 2:12:17 AM , Rating: 2
Meh. I own one, does the job for me. 1/4 the price of equivalent Apple product and about 1/2 equivalent Android when I bought it.

Do you think if Apple said they'd be top three in five years back in 2004 you'd believe them?

"If you can find a PS3 anywhere in North America that's been on shelves for more than five minutes, I'll give you 1,200 bucks for it." -- SCEA President Jack Tretton

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