Oracle claims that Google infringed upon Java patents when creating its successful Android mobile device platform. And now, it's become a major patent lawsuit. And if Google loses, it could stand to lose up to $6.1 billion, plus court costs.
This article published with permission from InvestmentU.com.
It’s hard to imagine Google (Nasdaq: GOOG) making mistakes.
They haven’t made many, but this one could hurt if Oracle (Nasdaq: ORCL) gets its way.
Oracle claims that Google infringed upon Java patents when creating its successful Android mobile device platform. And now, it’s become a major patent lawsuit.
Google could stand to lose up to $6.1 billion, plus court costs, if they lose.
But a ruling in Google’s favor may seriously hinder the future relevance of Sun Microsystems, Inc. and hurt Oracle’s stock…
Did Google Create Dalvik to Avoid Java’s Virtual Fees?
Many products such as the Amazon (NYSE: AMZN) Kindle and Apple (NYSE: AAPL) iPhone use Java’s virtual machine; however, the use of this virtual machine requires licensing fees. Oracle claims that Google created a new virtual machine called Dalvik to avoid these licensing fees in connection with the Android platform.
As far back as 2006, there were whispers that cash-rich Google might buy Sun Microsystems, Inc. Ultimately Google decided not to purchase Sun and the company was bought by Oracle for $7.4 billion in 2009.
Instead, Google decided just to develop a spin-off and save money. It was a clever move by Google, but it could now come back to bite them. The Ruling Implications on Mobile Devices Everywhere…
The implications of the ruling on the mobile device market could be huge.
It appears Oracle has the advantage. Last November the same team of lawyers won Oracle a $1.3 billion suit against competitor SAP.
There is no real consensus whether there is a technical advantage to Dalvik over Java. If Oracle can prove there is no technical advantage, it will be much easier to argue that Google created Dalvik simply to avoid fees.