Microsoft On Losing End Of Patent Battle

from the more-intellectual-property-law dept

Now Microsoft finds themselves on the losing end of a patent battle with Eolas Technologies, who apparently came up with a way to embed programs into webpages. At least that’s the description given in the article – which isn’t particularly clear. Eolas claims that Microsoft took their technology and put it into Internet Explorer. Microsoft claims that (a) the patent is invalid and (b) even if it is valid, they didn’t infringe. They’re going to appeal. Again, I tend to side against any patent related ruling when it comes to software patents, which just don’t make any sense to me. The judge chose the amount to fine Microsoft – $520 million – based on a “fair” charge of $1.47 per copy of Windows shipped. So, if the technology was in Internet Explorer – a free product, how is it that the charges are based on the number of copies of Windows? This is yet another case where it’s completely possible (and, in fact, likely) that two companies (if not more) came up with similar ideas and then went and coded them. Unless there’s evidence that Microsoft specifically stole code from Eolas, I’d say this is yet another example of why our patent system needs to be reformed.

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Comments on “Microsoft On Losing End Of Patent Battle”

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Zonker (user link) says:

This is the only way...

Companies like Microsoft, Sun, eBay, Amazon and so forth have to be bitten — hard — a few times by the patent bug before we’ll see real patent reform. When large companies start finding out that these kinds of patents work against them as well as for them, then they’ll start putting money into getting the regulations changed.

So, is the Eolas suit bogus? Yes. But I’m glad they’ve won. It’s the only way that things will change.

Doug says:

This isn't about a recent patent

Unless there’s evidence that Microsoft specifically stole code from Eolas…

Well, according to Cringely (emphasis added):

The patent stems from work done in 1993 by Doyle and Co. at the University of California at San Francisco, where they built an interactive 3-D medical visualization. These guys showed working applets and plug-ins in their enhanced version of Mosaic to NCSA, Microsoft and Sun a couple of years before any similar products like Navigator 2.0 or Java appeared on the market. It’s not like these outfits can claim to have developed their products ignorant of Eolas’ work.

Presuming that Cringely has the facts straight, it seems pretty clear that this isn’t some Johnny-come-lately patent, but the outgrowth of pioneering work with early Web browsers.

Thom K. says:

Re: This isn't about a recent patent

Actually, Microsoft’s first designs for a “browser” date back to 1989 – I know, I was part of the team. Microsoft’s first “browser” was the Multimedia Viewer, based on the WinHelp engine. You used MS Word to author RTF files which were interpreted by the Viewer app, again, just like Windows Help files. Viewer had a small business in the CD-ROM space, and we extended it to allow for combined online/offline experience when you dialed into a database via modem (again, pre-WWW). Using Dynamic Data Exchange (DDE), the precursor to ActiveX, COM, et al, the architecture allowed for the embedding of applications, right within the text. Like a web browser, the text could have
– hyperlinks
– linked graphics
– embedded “apps”
– mixed formats
– references that traverse networked servers (albiet in those days, LanMan style references)

And I know for a fact that there were patents on almost all of these techniques (you can imagine MS was/is paranoid about filing, filing, filing for every little idea). So, they *could* make an interesting argument

bastard sam says:

Re: Internet Explorer isn't free...

I’m using IE under Linux, and it works marvelously. But that’s aside from the point. The point is that Microsoft’s interests and our interests as software developers are completely in sync here. Microsoft did nothing wrong. This was the obvious implications of this technology.

Mike (profile) says:

Re: Fair charge?

and by giving somethign away it can be argued that you are depriving the legitamate owner of the product of the opportunity to sell the customer the same thing.

Actually, I have a lot of trouble with that argument. It supposes that competition is impossible. If I’m selling pizzas for $6 a pie, and the guy across the street is selling pizzas for $8 a pie, then do you complain to me that I’m “depriving the legitimate owner of the opportunity to sell”? No, you say that’s competition.

Zonker (user link) says:

Re: Re: Fair charge?

Most states have laws against companies giving away products or selling them below cost, because it is (or can be) anti-competitive for a company to do so. In the case of Microsoft giving away IE, it was an anti-competitive tactic – it cost Microsoft quite a few bucks to develop IE. Normally, the company would have charged for that program, but they gave it away to destroy Netscape.

In your scenario, two pizza shops across the street vying for customers, selling a pizza for $2 less would be fair — however, if Pizza Hut decided to dip into its cash reserves to give away pizzas for a month or two to drive competing chains or local pizza places out of business, they’d probably find themselves in court, and rightly so. That sort of “competition” would always favor a company with deep pockets (like Microsoft, or Pizza Hut) over a small company. Selling goods below cost is a tactic that has been used many times in American history by larger companies seeking to drive out competition so that they could have a monopoly position and (in the end) charge even more for goods or services once the competition is gone.

This is, btw, what’s happening with Microsoft and IE now. Now that Netscape is more or less defunct, Microsoft is ceasing to deliver IE as a standalone product. At a certain point, if you want the new features of IE, you’re going to have to buy the latest version of Windows. If you find that there are massive security holes in IE (not an unlikely scenario…) and you’re running Windows 98 or Windows 95 or even Windows 2000, you’ll soon have to “upgrade” rather than get new versions that fix those security holes.

Shelvin Datt (user link) says:

Interesting Open Source, could constitute anti-com

you make an interesting argument. Take IBM adopting Open Source strategies, against other integrated development environments (IDE), with adopting Eclipse as part of their Rational Application Developer which is sold (licensed), and competes against other Java IDE’s, as developers, get used to the free Eclipse Graphical User Interface, and then get their employers to purchase the commercial IDE Rational Application Developer, to develop web solutions on based on IBM Websphere technology.

“Eclipse cleaning out the market for commercial Java IDEs. Call it a hype, call it a good IDE, but Eclipse certainly caused some head-scratching in marketing departments of IDE vendors like Borland, JetBrains and the like. And with Oracle, Versant and Borland contributing code or even parts of their flagship products to Eclipse, will Eclipse be the only well supported IDE? There certainly doesn’t seem to be room left for huge and expensive IDEs like JBuilder in my opinion.” – Mathias Meyer

It would seem that IBM is using a vicing strategy against other commercial Java IDEs such as Borlands, JetBrains, Forte for Java and the like, all the while gaining this advantage from the open source community, for free. In other words squeezing them out of the market by providing Eclipse for free, at no cost.

IBM go as far as including these in its Database products such as DB2, which would compete against Microsoft SQL Server, which does not come with a bundled IDE, as you still have to purchase Visual Studio 2005 separate from any purchase of Microsoft SQL Server 2005. Taking your pizza argument, that would mean IBM are anti-competitive with Microsoft when it comes to database products as well.

Of course Microsoft is providing Express versions of its Visual Studio 2005 product base line, to compete against IBM and other open source databases, such as Firebird which is an open source fork of the InterBase 6 code base.

It?s always very interesting when Big software corporations take an open source project, re-brand it and then market and sell it, making millions of dollars, while vicing out other smaller competitors, with their well funded marketing and brand selling might.

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