Oracle and Google’s Court Case Will Shape the Future of 80% of the World’s Smartphones

By Bruce Harpham Monday, October 12, 2020

In early October, Oracle and Google began to argue their copyright dispute in front of the US Supreme Court. The case focuses on approximately 11,000 lines of code in the Android operating system. Oracle claims that Google's Android operating system violates Oracle copyright.

In the first few days of the case, the Supreme Court appears to have a limited appetite for Oracle's point of view.

A Key Technical Issue in the Case

In addition to copyright law's intricacies, Google and Oracle's dispute also revolves around technical questions. The Justices used a restaurant metaphor to explore the difference between the concepts. They compared declaring code to conventions in a restaurant where appetizers are usually listed before entrees. In contrast, the specific dishes under each heading could be considered implementing code.

Allowing a restaurant to copyright the concept of an appetizer could disrupt the entire restaurant industry. By that logic, Oracle's broad claim for copyright protection may not be reasonable. This metaphor is one way to look at the case. No doubt, the Justices will consider the case from multiple perspectives. The final ruling on the case is not expected until sometime in 2021.

The US Supreme Court Case Dates Back to a 2010 Dispute

Like many cases before the US Supreme Court, there is a long history to the Oracle and Google case. It started in 2010 when Oracle acquired Sun Microsystems for more than $5 billion. Google's Android operating system, in turn, uses some of Sun's code. When Oracle bought Sun, they acquired all of Sun's intellectual property, including copyright. When Oracle discovered Google was using some Sun code, this discovery ultimately led to a lawsuit.

In brief, Oracle claims that Google's Android operating system uses Sun code without permission. Google disagrees with Oracle's claims and states that its employees created the code behind the operating system. Besides, the companies disagree on the application of copyright to the code in question.

Implications for the US Tech Industry

The clash between Oracle and Google is more than enough to keep the technology community interested in the case. Other organizations have submitted formal documents to the court, known as amicus briefs, to express their views about the case.

Microsoft's submission to the court advocates for fair use in copyright law. At a practical level, Microsoft's document means support for Google over Oracle.

Microsoft's credibility on the matter is notable because the company relies on copyright for its products. Besides, Microsoft plays a notable role in supporting open source development. Ultimately, Microsoft argues that granting Oracle's argument would harm the collaborative nature of the software industry.

Redhat, an active developer of open-source software for years, also argues against Oracle. The company's submission to the court states:

“It has long been understood that software interfaces, as distinct from the software implementations of those interfaces, are not copyrightable subject matter…Unrestricted use of existing software interfaces has promoted competition and progress in the computer, information technology, communication technology, and networking fields, and is an essential aspect of all software development including both proprietary and open-source software development."

Redhat is arguing that Oracle's claim may significantly discourage innovation in the technology industry.

More Than $9 Billion Is at Stake for Google in This Case

There are technical and business issues at stake in the case. Consider the revenue at stake. Usually, technology companies are reluctant to report the precise amount of revenue they earn from each product. Thanks to a comment in court in 2016, we can estimate the value of Android to Google.

In 2016, Google's Android operating system generated revenue of $31 billion and $22 billion in profit, according to Bloomberg. In that year, Google's total revenue was $90.2 billion, so Android-related revenues would be 34% of its total revenue. If we assume that Android makes a similar contribution to the bottom line today, Google may have earned $54 billion in 2019 (i.e., 34% of Google's 2019 revenue of $161 billion).

Losing one-third of its total revenues to Oracle would represent a significant blow to Google's business. It would still own other lucrative products such as search ads and YouTube. Notwithstanding those facts, Google's business growth would almost certainly stall.

Fortunately for Google, an outright loss of the Android business to Oracle is unlikely at this point. Oracle is seeking approximately $8 billion in damages. Such a loss would hurt Google's growth prospects for a time.

From a technological perspective, this dispute over the Android operating system might threaten Android's stability and popularity. Since 2018, IDC reports that Google Android accounts for more than 80% of mobile device operating systems. If Google is forced to pay a considerable amount to Oracle, it may lack the funds to continue hiring staff and improving the product. Alternatively, the company may have to put other products on hold or decrease investment to support Android.

Impact of Ruth Bader Ginsburg’s Passing on the Case

The loss of Ginsburg, appointed to the court in 1993, is already impacting the case. A CNBC analysis of her writings suggests that she is likely to have supported Oracle in the case. With her loss, there is increased uncertainty about how the court will rule.

About the Author


Headshot of Bruce Harpham

Bruce Harpham is an author and marketing consultant based in Canada. His first book "Project Managers At Work" shared real-world success lessons from NASA, Google, and other organizations. His articles have been published in CIO.com, InfoWorld, Canadian Business, and other organizations. Visit BruceHarpham.com for articles, interviews with tech leaders, and updates on future books.

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