Oracle economist: Android stole Java’s “window of opportunity”

SAN FRANCISCO—An economist hired by Oracle was sworn in and took the stand in federal court today, opining that Google’s use of Java APIs in Android shouldn’t be considered “fair use.”

The testimony by Adam Jaffe wrapped up day eight of the Oracle v. Google trial, a legal dispute that began in 2010 when Oracle sued Google’s use of the 37 Java APIs, which Oracle acquired when it bought Sun Microsystems. In 2012, a judge ruled that APIs can’t be copyrighted at all, but an appeals court disagreed. Now Oracle may seek up to $9 billion in damages.

If Google hadn’t copied the 37 Java APIs in question, Android “very likely would not have been as successful,” Jaffe opined. He also believed that Java was “poised to enjoy continued success” in the mobile space, a point also made earlier today by former Sun licensing executives.

Google came in at the right time, and it was able to take advantage of “network effects” that pushed Sun out of the market, Jaffe told the jury.

“If you come late, you’re playing catch-up,” he said. “It’s hard to convince people your network is going to be big enough to be worth joining.”

In 2005, Java was doing great and was installed on about 1 billion handsets, he noted.

Once Android came out, the “window of opportunity” began to close, he said. A slide was displayed to a jury showing a literal window, being pushed down by various factors, labeled “Platform economics,” “Mobile Use Rising,” and “iPhone launch.”

Jaffe’s slide showed that Android-related revenue was $16.8 million in 2009, $600 million by 2011, and reached a whopping $13 billion by 2014. That’s mostly ad revenue, with a significant minority share coming from app sales, and small slices of revenue from hardware and digital content.

As Android continued its rocket-like takeover of the market, it served as an effective replacement product for Java, he noted. Like other Oracle witnesses, Jaffe insisted that Java ME can and did power “smartphones,” although the two sides have different definitions of that word.

To support his argument, he showed a slide with two side-by-side early HTC phones, the Android-powered HTC Dream and Java-powered HTC Touch Pro.

“These two phones were very similar,” Jaffe noted. “Both have color touchscreens, and full keyboards. Like Coke and Pepsi, they’re not identical, but they have very significant similar features.”

The two systems were in head-to-head competition, he argued, and Android “significantly harmed” Oracle, which should have inherited a booming licensing business when it bought Sun.

“It’s hard to compete with free,” Jaffe said.

In some ways, Jaffe was a surprising witness to be supporting Oracle’s potentially massive IP verdict. He’s the co-author of a 2004 book often referenced by skeptics of overly broad patent laws, Innovation and its Discontents.

SavaJe Love

On cross-exam, Google lawyer Robert Van Nest got Jaffe to acknowledge that most of Sun’s licensing business was based around Java ME (Mobile Edition), rather than Java SE (Standard Edition), which is what Google used in building Android.

SavaJe phone in 2006.

Credit: Yuichi Sakuraba

A succession of Oracle witnesses today had said licensing applied to both the “feature phone” and the smartphone market, but Van Nest called that into question. He handed Jaffe a small orange-and-white cell phone and began this line of questioning:

Van Nest: Do you recognize this?

Jaffe: That’s a SavaJe phone.

Van Nest: No touch screen, no QWERTY keyboard?

Jaffe: Right.

Van Nest: This is the SavaJe phone, that you and others said was a great early version of a smartphone?

Jaffe: I never said it was great.

Van Nest: It never made it to the market in any significant way, right?

Jaffe: That’s correct.

Jaffe remained on the stand until 1:00pm, when the court day ended. He’ll return tomorrow. Larry Page, the CEO of Google parent company Alphabet, is scheduled to testify tomorrow as well.