HTC Gets Second Chance With ITC, But Won’t Likely Matter

HTC Gets Second Chance With ITC, But Won’t Likely Matter

The International Trade Commission plans to review an earlier ruling on whether HTC violated Apple’s patents, a move largely seen as a formality that may force HTC to settle.

A six-member commission’s final recommendation is set for December 6.

Two of the patents in question deal with data transmission and dialing phone numbers from within emails, while the other two relate to software execution. On July 15, the ITC declared HTC violated only the first two patents, but the review committee may reverse that decision to include all four.

A settlement will likely require HTC to pay Apple hefty royalty fees for using its patents. The Taiwan-based company already gives Microsoft $5 for every handset sold, which brings the Redmond, Wash.-based company more revenue than from its Windows Phone sales.

An ITC ruling against HTC could result in an injunction banning its smartphones and tablets, which would likely push it to settle with Apple rather than risk such a costly ban.

HTC, hoping to avoid another such scenario, maintains the ITC should not threaten to ban its smartphones and tablets since they include hearing impaired features as well as Emergency Alert Services.

The ITC’s decision will depend on each company’s patent holdings, however, and Apple has the advantage in this arena. Apple’s patent trove continues to win it international legal victories against Android makers like Samsung.

Analysts say Apple is waging a proxy war against Google by suing Android makers like HTC and Samsung. The Internet giant, which has fewer patents than Apple to defend its OS, recently acquired patents from IBM and Motorola.

In fact, on September 8, HTC filed an ITC complaint against Apple using patents borrowed from Google’s Motorola takeover. Google’s willingness to help its allies suggests HTC and other Android makers have a fighting chance against Apple.

But patent litigation is often costly and lengthy, and HTC and Android partners may escape Apple’s proxy war by ditching Google’s mobile OS altogether. For example, HTC suggested it is thinking of purchasing HP’s discarded WebOS, while Samsung intends to focus on its Bada platform.

Microsoft’s Windows Phone platform may also give Android makers a way out of costly litigation of the kind HTC now faces in its ITC entanglement with Apple.

If the ITC rules against HTC on December 6, this may be just the push the company needs to pull itself out of the costly and time-consuming Android versus iOS game.

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