Print 21 comment(s) - last by charwagie.. on May 4 at 8:55 AM

Judge in Netherlands says HTC didn't realize supplier stole technology so HTC can use up existing mic stock

In a somewhat unusual move, HTC Corp. (TPE:2498) has seemingly conceded it made a mistake in terms of intellectual property and has dropped a key feature of its HTC One smartphone.

The company had contracted Geneva, Switzerland-based STMicroelectrics N.V. (EPA:STM) to provide a higher quality microphone to it.  The result was a "dual membrane HDR", which promised to capture subtle details of audio and speech, similar to bulkier studio mics of the past.

But it was discovered in teardowns by Nokia Oyj. (HEX:NOK1V) that STMicroelectronics had apparently stolen the mic technology used in Lumia phones from Nokia.  Nokia dubbed the patented technology "high amplitude audio capture".

While HTC may have been an unwitting party to this apparently blatant theft and transfer of intellectual property, it was still struck by a Nokia trade lawsuit in the Netherlands.  Nokia was eyeing to roll out the ban in other regions, including the U.S. if HTC didn't act.

HTC One 360 view
The HTC One'

Instead of fighting Nokia's claims, it appears HTC has conceded the fight, dropping the mic altogether.

HTC also clarifies the nature of the Netherlands ban in a statement, commenting that Reuters misreported on the lawsuit, and that it was not sued.  The suit only applied to STMicrolelectronics.  And while the HTC One might have been banned if it had willfully continued to buy and use the microphones, it was allowed to use up its existing stock as the Netherlands judge said that HTC was unaware of the IP theft.

HTC writes:
In light of several misleading stories regarding a recent injunction obtained by Nokia against STM (a supplier of components to HTC in The Netherlands) HTC looks to clarify the following points:

• Nokia has NOT obtained an injunction in The Netherlands, or anywhere else, against the HTC One.
• The Dutch proceedings were brought by Nokia solely against STM. HTC was not sued by Nokia in the Netherlands.
• The Dutch injunction prohibits STM from selling certain microphones to any company other than Nokia for a limited period.
• The judgment against STM states that HTC can continue to use microphones already purchased from STM in its products, because they were purchased in good-faith. Nokia's attempt to obtain a recall of microphones already sold to HTC failed.
• HTC will transition to improved microphone designs once its inventory of STM microphones is exhausted.

HTC appears to be relatively responsible in trying to promote patent cooperation between companies.  Despite the controversial nature of software/user interface patents, it pays royalties on every smartphone to Apple, Inc. (AAPLand Microsoft Corp. (MSFT) for patented software technologies which its interface resembles.

Sources: HTC, Engadget

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Not that I'm planning to buy
By bug77 on 5/2/2013 12:01:28 PM , Rating: 2
But will this dropped feature result in a price drop? I know a mic isn't that expensive, but still, if they were charging because of the HDR mic, removing that has to have an impact.

RE: Not that I'm planning to buy
By Belard on 5/2/2013 5:24:02 PM , Rating: 2
HDR mic is not owned Nokia. but that particular mic *is* Nokia contracted technology. HTC most likely bought a several million mic units already. this gives HTC time to design or buy another HDR mic.

The STM company has legal issues. most likely they will make $0 selling the mics to HTC. worse, they maybe paying millions in damages... its a matter if it was stupidity or greed.

RE: Not that I'm planning to buy
By bug77 on 5/2/2013 6:46:39 PM , Rating: 2
Well, it seems HTC opted to remove the feature, so I'm not betting on them buying anything from other suppliers.

By semiconshawn on 5/3/2013 2:21:43 PM , Rating: 1
• HTC will transition to improved microphone designs once its inventory of STM microphones is exhausted.

RE: Not that I'm planning to buy
By chµck on 5/4/2013 2:05:43 AM , Rating: 2
The HAAC mics are owned by Nokia. They were R&D'd by Nokia. Nokia owns the patent for them. STM was contracted to build them.

By charwagie on 5/4/2013 8:55:19 AM , Rating: 2
I think it will increase the price as they will probably use what they have learnt to design a better mic. Or they will source a better mic. Remember things are changing all the time this tech was probably outdated on the day the first customer purchased one. Also now that it has been brought out as a quality part of the phone. I would not be surprised if they added two mics and used them together to create an even better experience than the Nokia and advertising it as such.

“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads

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