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

At least they have the guts...

[kusanagi374]

It's obvious that the 3C Patent Group is guilty, but then... that's how things work in the western world, and such acts are protected by local governments.

I only see this as the chinese companies trying to defend their position, nothing more. They want to be competitive, even more than they already are.

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?

Re:Is it just me?

[Jameth]

It's interesting to note that, as India is an even bigger proponent of these freedoms than China, that the real champions of intellectual property freedoms are those in rising third world nations. This is the exact same position the US was in when it began its rise and it is interesting to consider that the economic situation of the country could so outstrip the cultural components in this manner. If you compare the three places, there are extremely few similarities, yet they all chose the same path when in the same situation.

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

[jonny4001]

Getting a patent does not give you the right to violate other laws, including antitrust laws. If you do, it is within the power of the courts to impose compulsory licensing.

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.

Francis Cabot Lowell

[mcc]

Believe it or not, the world still existed before 1900. Ever hear of Francis Cabot Lowell? In the early 1800s Britain's industry had some of the best industrial technology in the world, and they viciously protected their trade secrets, trying to make sure that no one else could get hold of their stuff. Francis Cabot Lowell around 1810 wanted to start some modern textile mills in New England, so he went over to England, got a job in a textile mill, examined the machines until he understood them, reverse-engineered the schematics and then memorized them, and came back to New England knowing how to build them himself. This is how the powered loom came to North America, It was the first example of industrial espionage in history that I'm aware of.

If you look at the period during which the U.S. began its rise as an international economic power-- not the post-Reconstruction period during which it had already completed that rise, which is where Edison existed-- you see LOTS of examples of stuff like this, over multiple areas of intellectual property. Witness Charles Dickens' desperate attempts to get America's book publishers to actually respect his copyrights...

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.

Re:It's not a US technology

[evilviper]

This has nothing to do with US technology.

No, but it has everything to do with the US patents.

The defendants are the US branches of these companies. And the legalities are up to US courts.

If the court rules that the fees much be reduced, then all DVD players sold in the US can pay those reduced fees. The fees might remain massively high in Japan, but that doesn't matter for DVD players in the US.