The IPcentral Weblog

Sunday, May 13, 2007

Microsoft Patent Strategies

CNN Money has an article by Roger Parloff on Microsoft's patent concerns in Linux technologies. Of particular note is Parloff's summary of Microsoft patent strategies, which show that the company has an interest in diffusing its technologies throughout the technological community, and in working with others on IP agreements:

In 2003, Microsoft executives sat down to assess what the company should do with all those patents. There were three choices.

First, [Microsoft] could do nothing, effectively donating them to the development community. Obviously that "wasn't very attractive in terms of our shareholders," Smith says.

...[second], it could start suing other companies to stop them from using its patents. That was a nonstarter too, Smith says: "It was going to get in the way of everything we were trying to accomplish in terms of [improving] our connections with other companies, the promotion of interoperability, the desires of customers."

...Microsoft took the third choice, which was to begin licensing its patents to other companies in exchange for either royalties or access to their patents. In December 2003, Microsoft's new licensing unit opened for business, and soon the company had signed cross-licensing pacts with such tech firms as Sun, Toshiba, SAP and Siemens.

Microsoft's approach of negotiating and working with other firms on patent agreements is clearly productive for all interests involved. Firms that compete in innovation want to create and commercialize innovative technologies, and Microsoft is a good company to partner with.

posted by Noel Le @ 4:06 PM | Patents

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