I’ve written before on how patents repress competition and benefit the larger players in a given industry by forming oligopolies with a limited number of competitors.1 This is supported by the comments of Googld’s Eric Schmidt in a recent interview:
WSJ: Are Apple and Google discussing a patent-related settlement?
Mr. Schmidt: Apple and Google are well aware of the legal strategies of each other. Part of the conversations that are going on all the time is to talk about them.
It’s extremely curious that Apple has chosen to sue Google’s partners and not Google itself.
WSJ: What’s the endgame of all of this patent litigation?
Mr. Schmidt: It’ll continue for a while. Google is doing fine. Apple is doing fine. Let me tell you the loser here.
There’s a young [Android co-founder] Andy Rubin trying to form a new version of Danger [the smartphone company Mr. Rubin co-founded before Android]. How is he or she going to be able to get the patent coverage necessary to offer version one of their product? That’s the real consequence of this.