Skyhook, Fighting for Its Life in Suit Against Google, Cries Foul: “Call in the Referees and Review the Tape”

9/16/10Follow @wroush

Boston-based Skyhook Wireless, in what could be a fight for its life, is taking a double-barreled legal shot at Google. In a pair of lawsuits filed against the search and advertising giant yesterday, the seven-year-old, 32-employee startup says Google illegally copied its location-finding technology and then leaned on business partners to use Google’s version instead of Skyhook’s.

Skyhook’s pioneering Wi-Fi- and GPS-based location finding software is used in millions of mobile devices. But larger competitors, including Google and Apple, have been hard at work on their own positioning technologies. The point of the suits, according to Skyhook CEO Ted Morgan, is to keep Google from using its market power to squash smaller competitors in the field. “We believe we have built this market, and we’re going to protect what we have done,” Morgan told Xconomy yesterday.

The first lawsuit, filed in Massachusetts’ Suffolk Superior Court, says Google interfered with contracts Skyhook signed with Motorola and Samsung to put Skyhook’s “XPS” location-finding system on the manufacturers’ latest generations of Android mobile phones. In the same complaint, Skyhook says Google unfairly used its control over the Android operating system to force Motorola and Samsung to use Google’s own location technology on their phones in place of Skyhook’s.

Claiming that Google’s actions will “irreparably harm” the startup, the suit asks the court to force Google to, in effect, butt out of the Motorola and Samsung contracts, and to pay Skyhook monetary damages.

The second suit, filed in U.S. District Court for the District of Massachusetts, says Google’s location-finding system infringes on four Skyhook patents. Issued between 2007 and 2009, the patents cover technologies that allow mobile devices to determine their locations based on their proximity to mapped Wi-Fi networks. Skyhook is again asking for an injunction—but in this case, it’s one that would shut down Google’s in-house location service entirely. Skyhook also asks for money damages.

Google has not reacted publicly to the lawsuits, and the company did not respond to Xconomy’s request for comment last night. [Update 2:00 p.m. PDT 9/16/10: Google corporate communications officer Andrew Pedersen replied to my query today, saying "We haven't yet been served, so we won't be able to comment on the complaint until we've had a chance to review it."]

It’s understandable why the Mountain View, CA-based company might be proceeding cautiously in this case, since there’s far more to worry about than the prospect of a protracted legal battle or financial settlement with a small Boston startup. What’s really at stake in the lawsuits is who will have access to the bonanza of location data generated by consumers using location-aware applications on their mobile phones.

This data, which reveals not only where mobile device owners are located but often what they’re doing, is of huge potential value to brokers of targeted mobile ads and other commercial offers. It’s in order to gather such lucrative data, Skyhook alleges, that Google is imposing its own Google Location Service on handset makers, and in the process violating the open spirit of the Android ecosystem.

Skyhook’s troubles with Google started this spring. As we reported at the time, Motorola announced on April 27 that it had forged an agreement with Skyhook to use Skyhook’s XPS for geographical positioning on its forthcoming Droid and Cliq Android phones rather than Google Location Services, a free location finding system available to all makers of Android devices.

Skyhook depends on such licensing agreements for its revenue. And manufacturers are happy to pay, according to Morgan, because Skyhook’s database of Wi-Fi access point locations is more comprehensive, and its positioning algorithms more accurate, than … Next Page »

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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