Patent War

From Forbes

1980: Sun vs IBM

In the 1980s, attorney Gary Reback was working at Sun Microsystems, then a young technology startup. A pack of IBM employees in blue suits showed up at Sun headquarters seeking royalties for 7 patents that IBM claimed Sun had infringed. The Sun employees, having examined the patents, patiently explained that six of the seven patents were likely invalid, and Sun clearly hadn’t infringed the seventh. Reback explains what happened next in this classic Forbes article:

An awkward silence ensued. The blue suits did not even confer among themselves. They just sat there, stonelike. Finally, the chief suit responded. “OK,” he said, “maybe you don’t infringe these seven patents. But we have 10,000 U.S. patents. Do you really want us to go back to Armonk [IBM headquarters in New York] and find seven patents you do infringe? Or do you want to make this easy and just pay us $20 million?” After a modest bit of negotiation, Sun cut IBM a check, and the blue suits went to the next company on their hit list.

2011: Microsoft vs Google

so why is Microsoft the one collecting royalties?

The reason is that Microsoft has more patents than Google. A lot more. The patent office has awarded Google about 700 patents in its 13-year lifetime. Microsoft has received 700 patents in the last four months. Microsoft’s total portfolio is around 18,000 patents, and most of those were granted within the last decade.