E-Commerce Times / Alter Agents

Microsoft and Google End Hostilities, Partner Up

October 7, 2015



By Quinten Plummer
Oct 2, 2015 7:00 AM PT

Following a successful series of talks, Google and Microsoft on Thursday announced they had come to an agreement to close about 20 lawsuits fired off by both sides.

Microsoft and Motorola Mobility had been at each other’s legal throats since 2010, with claims of unpaid royalties and unlawful reneges on agreements thickening the air between the two. Google purchased Motorola Mobility and inherited the company’s war roughly a year after the skirmishes with Microsoft began.

The 20 cases now resolved fell primarily into the categories of mobile phones, video decoding and WiFi, a person familiar with the matter told the E-Commerce Times.

As part of the agreement, Google and Microsoft will dismiss all pending patent suits between them, including cases pertaining to Motorola Mobility.

“Separately, Google and Microsoft have agreed to collaborate on certain patent matters and anticipate working together in other areas in the future to benefit our customers,” the companies said in a joint statement.

One of the areas Google and Microsoft intend to collaborate on includes a topic that once was a point of contention: video decoding.

Microsoft and Google are supporting the advancement of VP8 and VP9 technology and the Alliance for Open Media, the source said.

The Nadella Effect

Microsoft has been slow to embrace open source, collaboration and common good — philosophies that have been tenets of the tech world for quite some time, said Rebecca Brooks, a founding member of Alter Agents.

“This is a classic case of ‘if you can’t beat ’em, join ’em,'” she told the E-Commerce Times.

There’s strong, scientifically verifiable evidence indicating Microsoft’s move to join the rest of the tech world in open source and collaboration was propelled by a compelling force: the Nadella effect.

While tech analysts and reporters had fun with CEO Satya Nadella’s odd “cloud first, mobile first” mantra last summer, his much less concise — yet more encouraging — message has been one of collaboration, and meeting consumers on their terms.

For example, Microsoft pushed Office 365 to all major platforms instead of slapping proprietary padlocks on the cloud-based productivity suite.

“Nadella’s leadership style is much more progressive, in general, and this [agreement] is a huge sign of his attempt to bring Microsoft solidly into the new digital age,” said Brooks. “Google also benefits from this by getting the litigation monkey off their back and allowing them to refocus on their own innovations. Plus, the hint of future collaborations will burnish both brands.”

The Litigious Life

The peace treaty between Google and Microsoft may have benefited from time, and it might have been born of it as well. Time may have caused the company to forget the strains of litigation, and it might have cause both parties to grow tired of the litigious life, suggested Rob Enderle, principal analyst at the Enderle Group.

“Large tech companies tend to go through a litigation phase every decade or so, suggesting it takes that long for their institutional memory to forget how painful litigation actually is,” he told the E-Commerce Times.

In this case, that realization was bolstered by a shared goal of eliminating patent trolls, Enderle noted, and it’s hard to partner with someone on the opposite side of a lawsuit.

“So this is a combination of Microsoft once again realizing that litigation against a similar-sized firm is a money hole, and that Google is actually a decent partner against a bigger common threat both companies have,” he observed. “I expect we’ll go through another phase like this in about a decade, though.”

The idea that megacorporations beat the competition into submission through litigation is an antiquated ideology, and Microsoft has suffered through poor brand perception that has hobbled ventures from launch, said Alter Agents’ Brooks. “If Microsoft wants to innovate and be seen as a leader again, they need to truly lead the competition and not try to kneecap them.”