A U.S. antitrust regulator has opened a formal investigation to determine whether Google's Motorola Mobility unit is respecting the pledges it made to license industry-standard technology for mobile and other devices on FRAND (fair, reasonable and non-discriminatory) terms, Bloomberg BusinessWeek reported, citing "three people familiar with the situation."
The United States Federal Trade Commission (FTC) has issued a subpoena-like civil investigative demand to Google as it probes whether the search giant is improperly restricting rivals' access to patents for essential smartphone technology, one of the sources told Bloomberg.
According to one other source, the FTC is also seeking information from companies including Microsoft and Apple as it investigates whether Google plans to license technology under patents that help operate Wi-Fi, 3G, and video streaming on FRAND terms. The people spoke under condition of anonymity because they were not authorized to publicly discuss the matter. The FTC will also focus on Google's decision to continue the litigation Motorola Mobility started over industry-standard patents before Google acquired the company, added the same source. That litigation could result in blocking imports of widely popular consumer products such as Apple's iPhone and iPad or Microsoft's Xbox.
"We take our commitments to license on fair, reasonable and non-discriminatory terms very seriously and are happy to answer any questions," said Niki Fenwick, a spokeswoman for Google.
As device makers race for increasing shares of the highly-competitive global mobile-device market, projected to reach $360 billion this year, patent litigation is rapidly escalating in worldwide patent wars. The patent battle heated up in March 2010, when the iPhone maker filed its first complaint at the International Trade Commission (ITC) against HTC Corp.
"Antitrust agencies around the world are worried about this patent problem, which is particularly important as we shift to mobile technologies," said American Antitrust Institute president Bert Foer, as cited by Bloomberg. The Washington-based Institute advocates strong enforcement of antitrust law. "An injunction against the use of a patent can destroy a company's entire market strategy."
The FTC probe follows the European Commission's formal investigations of Motorola Mobility and Samsung Electronics opened earlier this year, addressing the same issues. U.S. antitrust regulators have agreed that the FTC will focus on Motorola Mobility, while the Justice Department will focus on Samsung's handling of industry-related patent claims, "another person familiar with the matter" told Bloomberg. "The person didn't know if the Justice Department has issued information demands in connection with its review of Samsung."
