Nokia Passes on Android. Does It Count on Google Losing Lawsuits?

Last Updated Nov 17, 2010 7:05 PM EST

Nokia's (NOK) new CEO, former Microsoft (MSFT) executive Stephen Elop, has given the final word. The Finnish handset maker will stick with its MeeGo and Symbian operating systems, rather than join the rest of the crowd and take up Google (GOOG) Android. The stated reasons are questionable, but one of the big factors is likely the elephant standing in the room while everyone pretends not to notice. The legal problems that Google already faces and that continue to grow could mean that Android ultimately won't work for handset vendors.

The common wisdom is that Nokia lost any momentum and is about to lose its lead in the smartphone market. It has a few reasons why a shift to Android might not look good:

  • Running Android would make it one among an entire pack, so getting people to buy its handsets might become difficult.
  • There are the billions of dollars that Nokia has spent on software development and acquisitions ($8.1 billion alone on Navteq, a potential Google Maps competitor). This is actually a false strategy because the company cannot recover those sunk costs, but human nature often has us chasing down the same road to avoid facing past mistakes.
  • Innovation would more clearly go to supporting Google and helping it get richer, an option that is galling for Nokia.
What no one seems to discuss, though, is the danger that Google faces from intellectual property lawsuits, whether directly or indirectly, through hardware manufacturers. Here are some of the actions already in progress:
  • Apple (AAPL) has sued Motorola (MOT) and HTC, targeting phones that run Android.
  • Oracle (ORCL) is suing Google for patent and copyright infringement over the latter's implementation of Java.
  • Vertical Computer Systems , which sued Microsoft and settled, is also suing Android handset makers Samsung and LG.
  • Gemalto has sued Google as well as Samsung, Motorola, and HTC.
That's quite a collection so far, and getting free software doesn't help a hardware manufacturer if it faces lawsuits without indemnification to cover its expenses. And even Google will have a difficult time indemnifying partners without a larger and more dependable revenue stream.

Nokia has to know this, and chances are that, as a result, it wants to avoid the potential problems. Plus, if you're in a given market, it's comforting to think that a competitor might get knocked out by the sheer weight of lawyers climbing up its back.


Image: Flickr user jheckle, CC 2.0.
  • Erik Sherman On Twitter» On Facebook»

    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.