Chinese DVD Makers Sue Over Royalties

Viceice writes "Afterdawn.com and DigiTimes are among many other news outlets reporting that DVD player makers from China are suing the 3C DVD Patent Group over royalties on patents held by the consortium. The suit accuses 3C alliance for price-fixing, unlawful tying of essential and non-essential patents together, group boycott and conspiracy to monopolize. According to the Chinese companies, typically U.S. patent licensing fees for other products are between 3 and 5 percent of the item's wholesale price, compared to the 50 percent for DVD players."

Comments

Is it just me?

[nihilistcanada]

What does it say about the times we are in that the greatest champions of intellectual property freedoms are the constituents of the biggest dictatorship of the world?

China will be the death of the patent hegemony

[Anonymous Coward]

Just because the Chinese government is a murderous fascist 800-pound gorilla, and it is increasingly beginning to decide that Chinese industry shouldn't have to be burdened by the limitations of western patents. After all, since China is not going to become a research and development hub as long as they pursue the whole "stalinism lite" thing and all their best and brightest continue leaving for American universities, it isn't like China is benefiting from the patent regime at all. So why not just start ignoring it whenever it gets inconvenient?

We've already seen this with the Red Dragon chip; this DVD thing may be the next big crack in the wall. Once Chinese industry is unburdened by patents, the rest of the world is going to have some other way to compete than government-granted monopolies on ideas in order to keep up.

Re:China will be the death of the patent hegemony

[PsiPsiStar]

No. China has not invaded another country for the last 200 years. ... debatable. There's still Tibet which was, despite past security agreements between the two countries, for all intents and purposes a separate country. Moreover, China's act was agressive and they claimed the land as their own. Likewise, there are the Xinjiang separatist rebels. The US used to support these guys, though it seems there's a quid pro quo between Bush and Beijing where Washington has agreed to consider the Xinjiang separatists as 'terrorists' and in return Beijing supports the 'war on terror.'

Re: Communism.

China is closer to Facism than Communism at the moment, though there are elections at the local level and national politics are like an oligarchy. The whole 'economic equality and state ownership of labor' has gone out the window in the past ten years. Everything is on sale there now. Communism is dead in China.

It's a fixed amount, not a percentage

[jdhutchins]

The summary is a bit misleading- the 3C group charges $20 per DVD player, not 50% of the cost. Although $20 may end up being 50% of the cost of a DVD player, a $100 DVD player still only has to pay $20. Their argument of "but everyone else does it this way" sounds like whining that they can't make $5 DVD players.

Maybe part of the reason the 3C is charging a flat fee is to prevent Chinese companies from severely undercutting their own offerings. They do have the patents on some DVD stuff, and I'm sure it's more than just worthless software patents. When you get a patent, part of the rights that you get is to prevent other people form using them, or making them pay a price of your choosing to use it.

Re:It's a fixed amount, not a percentage

[Yartrebo]

Well, it's up to the Chinese to decide what is legal and not over there.

Don't forget that we are more dependant on China for their manufacturing capacity. If China was to embargo us and dump their dollar reserves, it might put a crimp in their booming economy, but it could very well induce an inflationary spiral and depression in the USA.

Our economy is highly leveraged and vulnerable, their's is not.

Both of us have enough nukes to obliterate each other, so saber rattling will only go so far.

CSS Anyone?

[sepluv]

Maybe, this lawsuit could also be an opportunity to challenge their forcing the use of CSS (and regions) (in violation of the DVD video standard, misleading-advertsing laws and anti-trust laws) on most films to further their monopoly.

Re:This is neither surprising nor representative

[Jeff DeMaagd]

I have mixed feelings about "intellectual property freedom". Thus far, the only thing China is really good at is copying and making things very cheap. I really don't think they innovate, because there is seems to be no incentive to do so. It takes too much time and effort to make a "better mousetrap" if you will, and so little time and effort to copy that it isn't worth it unless there is some protection on the design

I don't like how US patents are abused, but I don't think doing away with patents will fix anything. You'd need a constitutional ammendment to do that anyway.

Re:This is neither surprising nor representative

[Mad Hughagi]

I really don't think they innovate

This is wrong on many levels.

The barrier to implementing research in China is much lower than in the rest of the developed world. Not only in an industrial sense, but in almost every field. Check out the foreign investment and developments in Beijing. People who think that China is just another cheap labour base are not taking in the big picture.

A professor was telling me that one of his collegues in China has graduate students willing to work 14 hour days 7 days a week, and lining up at his door to get a position in his lab. Contrast this with the declining number of graduate students (and the lack of funding for) in many fields in North America.

Now that we have globalization these patents really only help the management crust of the corporations. Everything else will get outsourced if it optimizes the finances, barring the so called "federal" corporations who are heavily subsidized by the government. Welcome to the new global community.