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🖥️ Google: Status Quo For Android?
The US Supreme Court handed Google Inc. (GOOG) a win in a long-running copyright infringement case filed by Oracle (ORCL). The technology industry heaved a collective sigh of relief in the wake of the judgment. (Tweet This)
Background: What began as a legal scuffle has turned into a decade-long grudge match between Google and Oracle. It started in 2010 when Oracle filed a lawsuit against Google for copyright infringement. When Oracle acquired Sun Microsystems, it also obtained the rights of a programming language Java. Oracle claimed Google had unfairly used Java without compensating Oracle in developing its Android mobile operating system. Oracle argued Google profited substantially, copying Java’s structure, sequence, and organisation and breaking copyright laws.
On the other hand, Google contended that the Java Application Programming Interface (API) used in building its Android operating system transcends copyright laws. APIs are pieces of code that enable two different programs to exchange information and interoperate to give the user a seamless experience. Google argued that extending copyright protection to APIs would hamper innovation and make Oracle a monopoly. Oracle, for its part, maintained that the APIs are intellectual property, and the developers need to be rewarded for it.
Oracle sought $9B from Google for using its APIs and further damages. The legal battle has spanned three trials and two separate appeals. Google received support from the tech industry in general, but the legal verdicts have been a back and forth until now.
What Happened?: The US Supreme Court overturned an earlier federal decision that Google had indeed infringed copyrights. The Court stated that Google only used code that is needed to build a different environment. The decision to let Google off the hook was also to prevent Oracle from becoming a monopoly. However, the Court did not weigh in on the broader issue of whether computer codes are copyrightable or not.
The win for Google came when scrutiny of technology giants is the highest it has ever been. It was a one-sided judgment as six out of eight judges favored Google (one of the judges had abstained). The decision allows Google to continue the use of the code in its Android OS.
Oracle criticized the ruling stating that Google is, in fact, the monopoly that should be feared and highlighted the Congressional hearings regarding its monopolistic business practices. The company said that Google’s dominance in the tech space is due to its power and ruled this decision is only increasing the barrier of entry for rivals.
The tech industry at large heaved a sigh of relief as APIs are how different applications speak to each other. A change in the status quo would have meant dramatic upheaval in the way companies do business with each other and a high level of uncertainty. As for Google, the company seems to have dodged a cannonball for now but has other priorities lining up. For instance, in the last week of March, CEO Sundar Pichai testified to Congress regarding online misinformation and arguing against changes to how the Internet is regulated in the US.
Market reaction: GOOG closed the day at $2,225.55, up 4.11%.
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GOOG $2225.55 +87.80 (+4.11%)
Analyst Ratings (44 Analysts) BUY 93% HOLD 07% SELL 00%
Fun Fact of The Day 🌞
The longest English word is 189,819 letters long.