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Japanese FTC Warns Microsoft
ChibiOne writes "The Japanese Fair Trade Commission has ordered Microsoft to cut a restrictive contract clause, designed to protect the software giant from patent-related lawsuits by PC manufacturers that sell products using Microsoft's Windows operating systems. Under such provision, Japanese makers would be unable to sue Microsoft even if the software giant's technologies are deemed to violate their patents. The Japan Times Online has the scoop."
It does seem a bit unfair to have to agree not to sue Microsoft even if they later violate your patent(s). That seems like a "cake and eat it to" proposition.
Manufacturers have voiced concern that Microsoft could conceivably gain access to proprietary information about their cutting-edge products, and would be able to distribute their technology to competitors using the Windows operating system.
I don't know if M$ would actually do this or not, but the disputed clause in the contracts essentially gives M$ a free ride to do so. If this is as it seems, I have to wonder at the arrogance involved in telling someone that they need to agree to let me violate their patents with impunity. Somehow I think these folks are genuinely confused when someone says, "That's against the law...." or "You really can't do that..."
But he said Microsoft would drop the clause from all contracts signed from August onward. He said this decision was made following internal discussions over the past year.
Perhaps M$ agrees? Sometimes even the 900lb gorilla can catch on.
Cheers!
Erick
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Use of this vehicle for transportation releases General Motors and its subsidiaries from all liability, including but not limited to, fraud, design or manufacturing flaw, and malice.
It's a nice trick if you can get away with it.
The real "Libtards" are the Libertarians!
Maybe because Microsoft doesn't have a hand in the japanese government and economy?
The US will rarely strike its own down if it will affect its economy or the pocket of politicians.
The Japanese Fair Trade Commission has ordered Microsoft to cut a restrictive contract clause, designed to protect the software giant from patent-related lawsuits by PC manufacturers that sell products using Microsoft's Window operating systems. Under such provision, Japanese makers would be unable to sue Microsoft even if the software giant's technologies are deemed to violate their patents.
Assuming that's a fair characterization of the contract provisions, I'd have to side with Microsoft on this one. (Egad! End of the World!)
Consider this scenario:
- Some random branch of Sony (or some other japanese conglomerate) gets a JP patent on some random software/hardware thingie.
- Sony builds it into their laptops and wants Microsoft to support it.
- Microsoft supports it, and includes it in their mainline product (even if it doesn't work on non-Sony platforms). Now every copy of their software shipped on a non-Sony platform is infringing.
- Some Sony competitor clones the hardware. Suddenly the patented-in-japan feature starts running on THEIR platform.
- Sony sues Microsoft. And wins. And collects big bucks for ALL the copies of the software that went out (which WERE infringing...).
So Microsoft gets beaten up for being a good guy and supporting Sony's gimmick.
Of course Microsoft wants to head off this scenario. So they write this clause into their contract. Sony (and every other HW vendor) now has a choice: Let MS use their patents, or don't have MS support of their platform.
What's "unfair" about that? How much is it worth to Sony to have Microsoft support their products? This is the set of terms under which Microsoft is willing to do it. They can take it, leave it, or negotiate a clarifying modification.
IMHO even their defacto monopoly power isn't being misused in this case.
(Besides: If Sony {or whomever} doesn't like it, they can always drop Microsoft and ship Linux, BSD, or what-have-you. B-) )
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
The Apache liscense has a similar clause (mostly to protect against SCO-like suits). It will be interesting to see if they are asked to revise their liscense as well.
Is Apache okay because they don't actually say 'you can't take us to court'? Rather they say 'taking action terminates this license'. Consequently the patent holder is free to take action, as long as they wear the consequences of their Apache license being cancelled?
I wonder why existing contracts are still valid if the government says it's illegal and wants the clause taken out? Seems to me their FTC should be able to say "take out the clause or we will rule it invalid". That would signal the other companies (and MS) that their patents would be enforceable regardless of the contract. When it got to court, the contract clause would be a useless defense because the court would invalidate it.
And it's right to do so. The only way any company agrees to terms like this is when their arm is being twisted. Wanna sell PC's? Agree to our outrageous terms or sell them without Windows. Sadly, the market for non-win PC's just isn't big enough for Sony, et al (yet).
History shows that a company needs to be VERY careful doing any kind of business with MS. These companies need this protection.
Then Microsoft should ask for licenses to the specific patents that Sony wants it to use in Windows. That way, Microsoft doesn't get to steal Sony's patent on a "system and method for inducing the destruction of a city by means of a giant robot" or any other patents totally irrelevant to supporting Sony's hardware.
And it is certainly an abuse of Microsoft's monopoly to demand the use of hardware companies' entire patent portfolios. Choosing to drop Microsoft is committing financial seppuku right now, although in a few years it might not be as big a deal. Microsoft would never be able to get away with a contract like that if manufacturers had an alternative other than bankruptcy.
There is an obvious way out of your scenario. Microsoft only supports the feature if they are given a license to the particular patent for use in the Windows OS. Of course, even this is probably unnecessary since hopefully the patent is on the hardware and not on some unwritten OS software that communicates with the hardware. (Otherwise, Linux is in a heap of trouble.)
A much more problematic scenario is that Microsoft uses the contract to include patented features in it's hardware products, such as the XBox. Essentially all the Japanese computer makers have to give up their patent rights in order to install Windows, an obvious abuse of the desktop monopoly. Hopefully the forced contract wasn't this broad.
Chris Mesterharm
When you rent a car at the airport, you sign some papers, and they tell you where the car is. The key is usually in the car. Without that agreement on paper, you'd be stealing their car. Presumably, for a suitable sum of money, you can persuade the agent to let you use a car whenever you like.
The difference in this case is that one of the parties cannot plausibly refuse to make a deal. For example, if you put a gun to the rental agent's head, then he'd sign any paper you want. Similarly, not shipping Windows is simply not an option for these Japanese companies, who are being bullied into signing away their intellectual properties. It's not a legal contract not because of the "car", but because of the uneven negotiating positions.
Under the provision, Japanese makers would be unable to sue Microsoft even if the software giant's technologies are deemed to violate their patents
Is this the same Microsoft that claims that Open Source software destroys intellectual property?
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Microsoft's arrangement with Apple more directly resembles contract theft.
Apple shouldn't have signed the contract, then.
I don't understand why you're lambasting Microsoft (even accusing them of "theft") when as far as I can tell they acted entirely in accordance with the law.