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Is Google the New Acacia?

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A few years ago, Streaming Media would consistently cover the litigation threats—and actual filings—made by Acacia Research.  At the time, Acacia was targeting streaming media technologies that it said infringed on its pool of patents, causing disruption in the market place and delaying everyone from colleges to enterprise customers from rolling out organization-wide streaming solutions.

While Acacia has moved on to other markets in recent years, the threat of a patent pool that actively litigates its portfolio of patents was a blow to innovation for a significant period of time.

Fast-forward to 2011, and we see Google may be starting to play the same game, but one with the open-source community's winds of change at its back.

“The tech world has recently seen an explosion in patent litigation," Google's general counsel Kent Walker noted in a blog post yesterday, the same day that Google announced its intention to offer $900 million for bankrupt Nortel's patents. This litigation is "often involving low-quality software patents, which threatens to stifle innovation."

It's interesting to hear Google espousing the issue of "low-quality software patents" as Google itself is known—almost exclusively—as a software company. Yet Walked takes aim at the patent trolls such as Acacia as justification for considering a strategy of amassing its own patent pool."

“Some of these lawsuits have been filed by people or companies that have never actually created anything," Walker wrote.

Back when Acacia was in its prime, filing more than twice the number of patent litigations than the next closest patent defender, one company CEO likened them to neighborhood bullies.

"Patent trolls are like neighborhood bullies," Robert J. Shillman, chief executive of Cognex told Business Week. "They can only be stopped by standing up to them, refusing to settle, and then challenging their patents in court."

Google seems to be taking a bit of a different approach, yet still one that causes concern, as Walker spells out a second kind of patent litigation strategy: one that is "motivated by a desire to block competing products or profit from the success of a rival’s new technology."

"One of a company’s best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio," wrote Walker. "This helps maintain your freedom to develop new products and services. Google is a relatively young company, and although we have a growing number of patents, many of our competitors have larger portfolios given their longer histories."

Google's informal mantra of "do no evil" may be challenged if it succeeds in acquiring the Nortel patents: Acacia, in a 2010 Business Week write-up, was labeled as "The Company Tech Loves to Hate" due to its insatiable litigation.

If Google uses its growing patent pool to defend itself for innovative purposes, the general tech community will accept that strategy; if the company, however, chooses to begin to block rival companies' innovations—as it has alluded to in the case of WebM—then Google risks becoming what it claims to abhor.

WebM is, in many ways, a litmus test for Google's open-source stance.

After purchasing On2, makers of VP8, Google spent months greenfielding the codec code before releasing an open-source version. Industry conjecture was that it was trying to avoid patent pitfalls from the original source code, although that has never been proven.

Once it released the open-source version of VP8, Google then tried to license VP8 under a BSD-like license that was modified solely for the purpose of indemnifying Google from litigation by anyone who used the open-source code. We covered this license modification, along with several other tech outlets, and Google backed off the modified license in short order.

More recently, as WebM has failed to make inroads against the H.264 codec (which is also covered by a patent pool run by MPEG LA) Google has resorted to stifling innovation by pulling the plug on native H.264 support within its Chrome browser. 

Google has also pushed forward with what it calls "reform" as it lobbies to have MPEG LA assessed by the US Department of Justice for possible antritrust violations, when MPEG LA expressed interest in gathering potential patents that VP8 may infringe on.

So will Google use the potential patents to stifle innovation?  Walker's last words in yesterday's blog post seem to indicate that the open-source community will use any means necessary to push VP8 via Chrome.

"We hope this portfolio will not only create a disincentive for others to sue Google, but also help us, our partners and the open source community—which is integrally involved in projects like Android and Chrome—continue to innovate," wrote Walker. "In the absence of meaningful reform, we believe it's the best long-term solution for Google, our users and our partners."

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