Microsoft

Section need checking: The accuracy of this section should be checked. Discussion of the possible problems can be found on the talk page in the section Talk:Microsoft#Jury verdicts, final decisions, and appeals

Microsoft is one of the most fervent lobbyists for software patents (along with IBM) and uses its own software patents aggressively.

Microsoft's patent collection

Before 1995: A perfect example of success without patents

By 1987, Microsoft had a revenue of $350 million and had only one patent. By 1990, they still had only 5 patents and their revenue was $1.2 billion. Data compiled with help from Dan Bricklin. Microsoft is thus proof that making a very profitable software company does not require patents.

Post-1995

In February 2009, Microsoft announced it had received its 10,000th patent. Given that they developed Windows95 and achieved a dominant position in the operating systems market with 77 patents or fewer, and they afterwards invested massively in patents and have held their dominant position, one could deduce that patents are not necessary for competing against others but are useful for entrenching a current position and preventing others from competing.

In 2008, 2009, and 2010, Microsoft was the recipient of the most software patents granted by the USPTO.

Litigation and licence fee demands

By Microsoft

See also: Software distributors paying Microsoft patent tax

(newest first)

• ZTE (another Chinese manufacturer)
• Foxconn's parent company Hon Hai pays for Android and Chrome 16 Apr 2013
• Microsoft v. Barnes & Noble (2011, USA)
• HTC pays royalties to Microsoft, 27 Apr 2010
• Asus and Acer are asked to pay royalties for shipping a competitor's product (Android)
• Microsoft v. Motorola (2010, USA) [1]
• Microsoft v. TomTom (2008, USA)
• Microsoft v. AT&T (2006, USA)
• Example software patents#Microsoft
• Microsoft's FAT patents

In 2007, Software Freedom Law Center estimated that, since Microsoft has had to pay more than US$4 billion due to patent suits, the users have ended up paying US$20 per copy of Microsoft's Windows operating system. So even when Microsoft is the target, the consumer ends up being the victim.

In 2014, as part of an antitrust review, the Chinese government published a list of 310 patents which (as written by Joe Mullin) "Microsoft believes entitle it to royalties over Android phones, and perhaps smartphones in general". (Mullin's article is on Ars Technica but I haven't looked into exactly who compiled the list - Did MS or the Chinese government make the list? Surely both played a role, but what role? And are these patents that MS claims are essential, or that MS or China believe might be essential?)

Against Microsoft

Section need checking: The accuracy of this section should be checked. Discussion of the possible problems can be found on the talk page in the section Talk:Microsoft#Jury verdicts, final decisions, and appeals

• 2010: Microsoft pays BackWeb (US$2.1 million? Did they also pay out to Sybase? If so, that was some figure closer to US$10 million)
• 2010: VirnetX v. Microsoft (2010, USA) - Microsoft pays $200 million
• 2009: Uniloc vs Microsoft, 2009 - the jury verdict was that Microsoft must pay $388m to Uniloc, but verdict was vacated by the trial judge in his final decision; two appeals are pending (court docs: 08-1121.pdf)
• 2009: i4i v. Microsoft - MS, guilty of wilful infringement, ordered to pay $290m to i4i. MS loses expedited appeal, final appeal verdict pending
• 2009: Microsoft was part of the group that paid an undisclosed sum for the CSIRO wifi patent
• 2008: Visto v. Seven (2006, USA) - Microsoft settled (without going to court?)
• 2008: Alcatel-Lucent v. Microsoft (2008, USA) - Microsoft initially ordered to pay $358 million, but the CAFC is reducing that
• 2006: z4 v. Microsoft and Autodesk - the defendants paid $133m to z4 Techologies
• 2004: Eolas v. Microsoft (2004, USA) - MS ordered to pay $521 million, then settled privately
• 2004: Burst v. Microsoft (2004, USA) - MS settled out of court for $60 million
• 2003: MS pays $144 million to InterTrust (older story: InterTrust says that Microsoft has violated its DRM patents)
• 1993: Stac v. Microsoft (1993, USA) - MS, guilty of wilful infringement, had to pay $120 million

VirnetX (200) + Uniloc (388) + i4i (>290) + z4 (66.5?) + Burst (60) + InterTrust (144) + Stac (120) = $1,268,500,000 (one and a quarter billion), and that's not counting the undisclosed sums of the Eolas, Visto, or CSIRO cases.

Pending accusations

• Hochstein and Tenenbaum suing MS over Xbox, based on a patent on "communicating live while playing the same video game in separate locations"
• EMG Technology v. Microsoft (2009, USA) - for infringing patent US7020845 and US7441196
• AllVoice Developements v. Microsoft (2009, USA) of violating proofreading patents

Microsoft's unsubstantiated accusations

• 2007 claim that GNU/Linux infringes 235 MS patents, as of May 2009, Microsoft has still refused to say which patents
  • Groklaw response
  • "Sue me first, Microsoft" - where people can sign up to ask to get sued
• 2007-03-16: Through the Patent Looking Glass with Microsoft's Brad Smith, by Andy Updegrove

Microsoft's claims there are 235 patents infringed by the GNU/Linux operating system as a whole. These break down as:

• the kernel Linux: 42
• graphical user interfaces: 65
• Open Office: 45
• E-mail programs: 15
• Other: 68

Microsoft's patent promises

These are ostensibly legally binding statements that allow the unlicensed use of certain technologies which may or may not be covered by Microsoft-owned patents.

• The Microsoft Open Specification Promise (OSP)
• The Microsoft Community Promise (CP)

According to Microsoft the Community Promise is more demanding than the OSP, for example it only applies if you implement the covered standards correctly.

If you get involved in a patent infringement suit against Microsoft, then the promises no longer apply to you and you may find yourself counter-sued for infringement of MS patents purported to apply to the covered standards. This might happen for example if you or an associate believe that Microsoft have infringed one of your patents. Thus Microsoft appear to open up a handful of their patents to you, on condition that that you effectively open all of yours to them.

In 2009, Microsoft extended the CP to include C# and mono. The Free Software Foundation have issued a statement warning against what they see as Microsoft's Empty Promise

Lobbying and amicus briefs

Microsoft were one of the main lobbyists for software patents in the EU software patents directive. They lobbied both directly and by funding (non-transparently) "sock puppet" campaigns such as Campaign4Creativity.

In the 2008 in re Bilski case in the USA, Microsoft submitted a joint amicus brief with Dell.[2]

In the follow-on 2009 Bilski v. Kappos case, Microsoft submitted a joint brief with Philips and Symantec.[3]

In September 2009, Microsoft submitted a letter for the Australian government's patent consultation.

Gates' 1991 memo

The following is from a memo which Bill Gates sent the the upper-management in Microsoft on May 16th, 1991. This memo was made public during a court case.

Patents: If people had understood how patents would be granted when most of today's ideas were invented, and had taken out patents, the industry would be at a complete standstill today. I feel certain that some large company will patent some obvious thing related to interface, object orientation, algorithm, application extension or other crucial technique. If we assume this company has no need of any of our patents then they have a 17-year right to take as much of our profits as they want. The solution to this is patent exchanges with large companies and patenting as much as we can. Amazingly we haven't done any patent exchanges that I am aware of. Amazingly we haven't found a way to use our licensing position to avoid having our own customers cause patent problems for us. I know these aren't simple problems but they deserve more effort by both Legal and other groups. For example we need to do a patent exchange with HP as part of our new relationship. In many application categories straightforward thinking ahead allows you to come up with patentable ideas. A recent paper from the League for Programming Freedom (available from the Legal department) explains some problems with the way patents are applied to software.

Given the date, the League for Programming Freedom document he references is probably this one: Against Software Patents

Related pages on ESP Wiki

• Software distributors paying Microsoft patent tax
• Novell-Microsoft patent deals
• Nortel and Rockstar Bidco
• Antitrust law is not solving the problems - with info about Microsoft

External links

• FFII's page about Microsoft (out of date)
• Archive or previous version of FFII page
• MS Versus - page about MS and patents
• MS announces their 5000th patent, March 2006
• MS patents disabling features
• Microsoft, the Innovator?, by David H. Wheeler
• Patent threats from Bill Gates and Steve Ballmer
  • "At some point we will have to consider the patents they [StarOffice] violate."
• Microsoft quotes about software patents
• A 2004 patent deal regarding StarOffice/OpenOffice.org, signed with Sun Microsystems
• 2010-03-09: Good Artists Copy, Great Artists Steal, by Johnathan Schwartz of Sun Microsystems about patent threats from Apple and Microsoft
• Chinese gov’t reveals Microsoft’s secret list of Android-killer patents, 16 June 2014, Joe Mullin (Ars Technica)
  • Discussion: Slashdot
• 4 Shifty Details About Microsoft's "Open Source" .NET, 29 March 2015, Liu Qihao & Ciaran O'Riordan

Patently-o coverage

• http://www.patentlyo.com/patent/2009/02/percent-of-pa-1.html
• http://www.patentlyo.com/patent/2009/02/percent-of-pate.html