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."

Comments

Sign here, no need to read it.....

[erick99]

Under the provision, Japanese makers would be unable to sue Microsoft even if the software giant's technologies are deemed to violate their patents.

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

Re:Sign here, no need to read it.....

[rewt66]

This could be really good. If enough people like Microsoft start realizing that patents are a weapon that can hurt them, we might start to see some patent reform.

Of course, it's going to get worse before it gets better, because right now everybody (Microsoft included) is patenting everything in sight. While Microsoft has given us plenty of reason to doubt their motives, one reason they are doing this is so that somebody else doesn't go ahead and patent an idea that Microsoft is using. This is a distraction from their real business, and it still leaves the possibility of being on the receiving end of a big extortion lawsuit.

When the pain gets bad enough, enough companies will demand patent reform to get it to happen. The only question is how bad the pain will get for the rest of us before the reform comes...

That's like Detroit having a license like

[Anonymous Coward]

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.

Another meaningless response from Microsoft

[whoever57]

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.

Current contracts remain valid for Windows XP and earlier Windows versions.

So the vast majority of Japanes companies will still be shackled by MS's contracts -- contracts with a company that has a track record of violating patents!

I'm with Microsoft on this one. (EGAD!)

[Ungrounded Lightning]

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-) )

Apache License

[femto]

So what does this mean for the patent clauses of the Apache License?

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?

craziness

[Anonymous Coward]

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.

Re:I'm with Microsoft on this one. (EGAD!)

[polveroj]

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.