Follow Slashdot stories on Twitter

 


Forgot your password?
Close
typodupeerror
×
Microsoft Government Patents The Courts News

Microsoft Pays $440M to License InterTrust Patents 169

Posted by timothy from the never-intertrust-anyone dept.
theodp writes "Microsoft is paying $440 million to InterTrust to settle a three-year-old patent infringement lawsuit over DRM technology for protecting music, movies and other digital content against piracy. Under the settlement agreement, customers can use Microsoft products and services without a license from InterTrust. Developers, however, may need a license from InterTrust for other uses, including the combination of Microsoft technology with third-party technology." C.J. adds a link to the New York Times' coverage of the settlement.
This discussion has been archived. No new comments can be posted.

Microsoft Pays $440M to License InterTrust Patents More

Microsoft Pays $440M to License InterTrust Patents

Comments Filter:

  • $440 million? (Score:2, Interesting)

    by TheKidWho ( 705796 )
    $440 million? Eeeek.. thats a lot of money for something that seems to relatively simple :-/ I mean, for $440 million im sure microsoft can develop a DRM system 100000x better then what they have right now.

    • Re:$440 million? (Score:5, Funny)

      by grub ( 11606 ) <slashdot@grub.net> on Monday April 12, 2004 @07:39PM (#8842822) Homepage Journal

      for $440 million im sure microsoft can develop a DRM system 100000x better then what they have right now

      Based on their record thus far, zero times "100000" still doesn't add to much.

    • Re:$440 million? (Score:5, Insightful)

      by frovingslosh ( 582462 ) on Monday April 12, 2004 @07:42PM (#8842855)
      You don't understand. This is $440 Million that Microsoft gave to InterTrust so that InterTrust would have a big warchest to go after everyone except Microsoft who tries to compete with Microsoft. It's a drop in the bucket to Microsoft (see the last few weekly Cringley articles), and it is an even better way to grab position than to give SCO money under the table to have them try to kill Linux.
      • Yeah, now no chance of an open source DRM package. What a tragedy.

      • Re:$440 million? (Score:2, Insightful)

        by Anonymous Coward
        It certainly seems to be the new Mictosoft strategy: license dubious technology, giving money to companies to sue and harrass their competitors!

      • Exactly. It gets around the DOJ and EU. (Score:1, Insightful)

        by Anonymous Coward
        This is Microsoft's new method for getting around the DOJ and EU requirements that Microsoft license their protocols to others.

        Microsoft pays InterTrust a lot of money, and then InterTrust refuses to license to anyone else (unless Microsoft approves), thus giving Microsoft a monopoly on the protocol, just as if it was Microsoft's own secret/patented protocol.

        But if the court tries to say that it violates the DOJ or EU settlement, then Microsoft just responds, "Hey, we're the victim here. It's InterTrust t

    • Comment removed (Score:4, Insightful)

      by account_deleted ( 4530225 ) on Monday April 12, 2004 @07:44PM (#8842879)
      Comment removed based on user account deletion

    • Re:$440 million? (Score:2, Informative)

      by Anonymous Coward
      I have bought stocks in Intertrust a couple of years ago for around $20 (during the dot=com-bbom), then got squeezed out by Sony and Philipps, for $4. Though it's a good feeling seeing that the investment was right in general it's sad that Sony and Philipps could squeeze me out...

  • Third Party? (Score:5, Interesting)

    by BandwidthHog ( 257320 ) <inactive.slashdo ... icallyenough.com> on Monday April 12, 2004 @07:36PM (#8842794) Homepage Journal
    I've been wondering if the implication is what I think it is... if you use MS software through-and-through you're fine, but if you mix software from multiple companies, you're liable to InterTrust for royalties?

    Could MS have crafted a sweeter deal if they tried? (ya know, other than the half billion dollar payout)

    • Re:Third Party? (Score:3, Insightful)

      by Anonymous Coward
      Except for the fact that Microsoft has been touting how many choices you have for their DRM protected content. Now they've landed themselves in the same boat they are accusing apple of being in wrt FairPlay/iTMS.
  • I suspect US and Japanese software development will slow to a grinding halt.

    • Re:With all these incredible limitations on coding (Score:1, Insightful)

      by Anonymous Coward
      Not to worry. India and China will be more than happy to pick up the slack!!! (really!, I'm not trying to troll here!)
      • Software built in India or China will not be legal in the US if they don't adhere to these ridiculous software patents.

        It will be almost impossible to sell software in the US, whether it's made domestically or internationally, because it's practically impossible to make software that's legal in the US.

        The US will become a software 3rd world country if you don't repeal the software patent law.
        • "The US will become a software 3rd world country if you don't repeal the software patent law."

          In most third world countries a handful of people control virtually all the wealth. There are just a few very powerful companies and tons of little mom and pop grocery stores.

          Seems to me we are well on our way.

        • Software built in India or China will not be legal in the US if they don't adhere to these ridiculous software patents.

          That's not a problem.

          Software will be made in India, China and elsewhere, and web sites based there will sell their software over the Internet to US customers, despite the infringement of US patents. US home customers are sure to buy and use it, even when businesses daren't.

          Ironically, the shareholders will be based in the US for a while longer. Looks like you guys are funding you

  • 0.4 billion. (Score:3, Funny)

    by Anonymous Coward on Monday April 12, 2004 @07:40PM (#8842834)
    Thats what, roughly 1% of their total cash? Between this at the UK trouble they are down 2%.

    Keep chipping away fellas.

    • Re:0.4 billion. (Score:3, Insightful)

      by Bill Currie ( 487 )
      1/2 billion here, 1/2 billion there, 1/2 billion everywhere (btw, that was EU, not UK), EIIOU. If this sort of thing keeps up, Microsoft will, eventually, run out of cash (I seem to remember reading somewhere they're not actually earning any profits at the moment).

      • Re:0.4 billion. (Score:3, Insightful)

        by Pharmboy ( 216950 )
        Or they will release Longhorn, starting a wave of upgrades, some forced. And a new version of Office. I don't think anyone that owns significant stock in Microsoft, or anyone working at Microsoft, has missed a meal lately.

        Microsoft is definately making a profit, and a large one at that. Anyone who tells you otherwise is simply wrong.
    • Don't forget the 2 bil to Sun.

    • Re:0.4 billion. (Score:5, Informative)

      by Osrin ( 599427 ) on Monday April 12, 2004 @08:22PM (#8843130) Homepage
      http://www.nasdaq.com/asp/extendfund.asp?symbol=MS FT&selected=MSFT&page=full

      That shows a net profit of about $26bn, and around $10bn in net earnings for 2003.

      Times are probably not as tough as you think.
  • http://www.theregister.co.uk/2004/04/12/ms_settles _intertrust/

  • Cost benefit analysis? (Score:3, Insightful)

    by EdipisReks ( 770738 ) * on Monday April 12, 2004 @07:41PM (#8842850)
    what is the cost benefit analysis of this? would microsoft have saved money if they had simply licensed everything first, or is the $440 million cheaper? i imagine that big software companies do the same kind of CBA that auto companies and the FAA do.

  • Reaffirmage (Score:2, Funny)

    by tds67 ( 670584 )
    "Licensing InterTrust's patent portfolio reaffirms Microsoft's commitment to the importance of intellectual property rights as well as our commitment to our customers to stand behind our products in these emerging technology areas," said Marshall Phelps, Minister of intellectual property at Microsoft.

    It reaffirms that Microsoft will respect your intellectual property rights when they can't assimilate them by brute force.

  • NY Times Reg-free link (Score:4, Informative)

    by Patik ( 584959 ) * <.cpatik. .at. .gmail.com.> on Monday April 12, 2004 @07:43PM (#8842865) Homepage Journal
    click here [nytimes.com]

  • end to DRM? (Score:2, Interesting)

    by contrasutra ( 640313 )
    Hey, for once I like software patents (I know, hypocracy and such). If someone's patented DRM in general (anything's possible it seems), maybe they can go SCO and stop all the other companies from implementing DRM. We might get a break from this mess.

    Also, I'll be the first(?) to point out the irony in this. These people are so concerned with Intellectual Property, but they are infringing on it themselves. Not that they're "at fault", but that the system is messed up.

    • If someone's patented DRM in general (anything's possible it seems), maybe they can go SCO and stop all the other companies from implementing DRM.

      Uhh.. no.

      Your hypothetical company would have 3 choices:

      1) Make a product with their patented DRM system.

      2) License the DRM to others (as an IP-only company)

      3) both 1 & 2 (as countless companies currently do)

      One company patenting DRM won't wipe it off the planet, these companies patent products for a reason: money.

    • Its not going to be a good thing. Once the patent holder has lobbied to have their version of DRM required by law, under the guise of computing security, all software will need to make use of it. At the very least, the technology will be required to get your program to run on Windows. The only way to use the technology is to pay the licensing fee. Or get sued, of course. If you don't have the money to license the DRM for your app, too bad, you won't be releasing it. This will be the end of small software co

  • Three year old infringement? (Score:4, Insightful)

    by Poison_kitty ( 670218 ) on Monday April 12, 2004 @07:44PM (#8842876)
    Sorry but that rings a few bells there, Big-Ben sized bells. If it was really tha important to them in the first place wouldnt they have sorted it out when it was first found to have occured? It seems to me that microsoft are completely willing to put individual people in jail for minor acts of copyright infringement but when it comes to a whole company theyre more than happy just to pay them off and hope it all goes away.
    • ah, when was the last time MS initiated a criminal investigation "for minor acts of copyright infringement?"
      even pissing off the RIAA usually doesn't bring the sheriff to your door unless you've been shareing 20,000 or so mp3s with your closest friends on Kazaa.

  • New head of Legal Dept. (Score:5, Insightful)

    by Simple-Simmian ( 710342 ) on Monday April 12, 2004 @07:47PM (#8842906) Journal
    Microsoft® has a new head of it's leagl department. Thats what up. Settling and trying to hold on to it's money. If they had lost ( just might have) they would have spent more. This make good business sense. I still hate their guts but it makes sense.

    Look for them to make more settlements.

  • BBC coverage [registration-free] (Score:3, Redundant)

    by Compact Dick ( 518888 ) on Monday April 12, 2004 @07:47PM (#8842909) Homepage

    Check out the BBC's article: Microsoft settles patents case [bbc.co.uk]
  • Am I the only one that doesn't like the idea of Microsoft dealing with a company called InterTrust?
  • You pay millions of dollars in lawsuits to Microsoft!
    Wait.. why wasnt that as funny as I thought?
  • Linux.
    GPL = no fuss, no muss, no $$$

    Gotta love it!

  • plop, plop, plop... (Score:2, Insightful)

    by Geek_3.3 ( 768699 )
    Three drops in a very large $40 billion bucket, unfortunately.
  • 1. License DRM patents
    2. Release DRM Software
    3. Wait for DMCA to get struck down as a show of good faith
    4. Sue unsuspecting F/OSS developers writing a WMP DRM bypasser for xmms for "patent infringement"
    5. ???
    6. Profit!

  • hmm.. (Score:5, Funny)

    by dj245 ( 732906 ) on Monday April 12, 2004 @07:59PM (#8842999) Homepage
    Microsoft, patents, a conspiracy to make lots of money, Intertrust, and a "registration required" New York Times Article. All we need to whip the /. crowd into a froth now is a Linux reference and a SCO allegory. Here goes.

    This is soooo just like SCO trying to make money on linux. I hope they lose!

    • > The number of the modding shall be three, four shall the number of the modding not be, neither shall it be 2...

      You fools! five is right out!

      • Re:hmm.. (Score:3, Funny)

        by dj245 ( 732906 )
        >>sig: The number of the modding shall be three, four shall the number of the modding not be, neither shall it be 2...

        >quote: You fools! five is right out!

        As it was originally 2 with the karma bonus, it was only modded +3. 3 was indeed the number of their modding. The number of their modding was 3. Their modding did not extend to +4 (extra funny), neither did it languish to +2 (a total of +4). A modding of +5 was right out impossible, as the karma is good.

        Then shall I reacheth out with m

  • Anyone else read... (Score:4, Funny)

    by ocie ( 6659 ) on Monday April 12, 2004 @08:01PM (#8843013) Homepage
    Microsoft pays $440M to license InterTrode Patents?

  • Okay, dumb question (Score:5, Insightful)

    by caffeineHacker ( 689198 ) on Monday April 12, 2004 @08:03PM (#8843024) Journal
    I know they are a huge company...but I really don't see how they can afford to keep losing money like they do. A few billion to Sun here, millions to BeOS here, $440 million for some patents, losing millions on X-Box, millions in lawsuits and fines, funding SCO, etc. It seems that eventually they'd run low on cash to throw away on stupid crap...but I've never had billions of dollars so I guess I wouldn't know.

    • Re:Okay, dumb question (Score:4, Insightful)

      by fermion ( 181285 ) on Monday April 12, 2004 @10:02PM (#8843742) Homepage Journal
      I think there are two related reasons. First, MS can set the price of products to whatever they want. That means that they have a high profit margin, for the time being. They need to invest that money in some way. They are increasingly becoming even less of a devlopment company. The two flagship products, Windows and Office, are more or less stagnant. The OS they promised next year has been pushed to the next decade. Office has had no significant improvements in years. So they don't invest in new software products, and the xbox can only eat so much. So where to invest the money?

      This leads to reason two. They say they want to follow the IBM path of making monye off IP. This means that they have to clean up thier IP portfolio. The money is largely irrelevent as it is almost free and there is probably no better investment. The license fess they collect will be pure profit.

      As an aside, it is a very shrewd tactical move. Intertrust now has another company paying it royalties. It has a basis to demand payment from any software that uses the technology. This means that MS, with sony and Philips, has cornered the market on this particular DRM. In the end it mean a new oligarchy of music distribution. Goodbye fair use on *nix systems, goodbye iTunes.

      • They are increasingly becoming even less of a devlopment company. The two flagship products, Windows and Office, are more or less stagnant. The OS they promised next year has been pushed to the next decade. Office has had no significant improvements in years. So they don't invest in new software products, and the xbox can only eat so much. So where to invest the money?

        Kinda reminds me of the game Railroad Tycoon (one of my favorates). You start out and grow your railroad, trying to box the other companie
    • I know they are a huge company...but I really don't see how they can afford to keep losing money like they do. A few billion to Sun here, millions to BeOS here, $440 million for some patents, losing millions on X-Box, millions in lawsuits and fines, funding SCO, etc. It seems that eventually they'd run low on cash to throw away on stupid crap...but I've never had billions of dollars so I guess I wouldn't know.

      I don't think you realize how much cash they have. I seem to remember that a couple quarters a

  • Microsoft using monopoly power again!!! (Score:5, Insightful)

    by brxndxn ( 461473 ) on Monday April 12, 2004 @08:09PM (#8843054)
    Dammit! It seems like everything bad that happens to Microsoft, Microsoft turns around and uses it in their favor...

    I mean:
    - States sue Microsoft for abusing monopoly powers; Microsoft pays lawsuit with Microsoft products that indoctrinate kids (future buyers) into Microsoft products.

    - Microsoft sues Lindows for it's impossible common word trademark of windows in US courts. Microsoft loses. Microsoft sues Lindows in other world courts; Lindows is forced to change name. Microsoft loses, yet wins. Lindows runs out of lawsuit money.

    - States sue Microsoft over alleged undocumented Windows routines that allow MS software to run better on Windows than other software. Source code is released later on that shows MS lied in court. Nothing happens to MS!

    How is this new lawsuit good for anything but Microsoft? It's like Microsoft basically paid $440million to ensure that 3rd party software has a disadvantage - something Microsoft has already been sued for! This, once again, screws consumers by causing 3rd party manufacturers to pay more for licensing and allows MS to eat another market.

    MS is really clever at screwing us all in the ass as efficiently as possible.

    • Re:Microsoft using monopoly power again!!! (Score:4, Interesting)

      by Daath ( 225404 ) <(kd.redoc) (ta) (pl)> on Monday April 12, 2004 @08:39PM (#8843248) Homepage Journal
      Your first, second and third points are noteworthy. Valid points that annoy me too. But.
      How is this new lawsuit good for anything but Microsoft? It's like Microsoft basically paid $440million to ensure that 3rd party software has a disadvantage - something Microsoft has already been sued for! This, once again, screws consumers by causing 3rd party manufacturers to pay more for licensing and allows MS to eat another market.
      It's a settlement. Microsoft settled with InterTrust, by agreeing to license their technology. This license means that they can use the technology in their products. Third parties have a disadvantage in that they ALSO (surprise) need a license to use that same technology. It's logical, and it's normal business practise.
      A small company doesn't need to spend more than (or in fact anywhere near) US$ 440.000.000 for a license. It's cheaper. Microsoft just struck a deal. Microsoft wins and InterTrust wins.
      Now go sulk somewhere else ;)
      • "A small company doesn't need to spend more than..."

        What small company? Seriously, what small company is going to try and break into the market and attempt to create DRM media? What other company besides some of the large guys (MS, Apple, Real, etc.) have any chance against a company that controls so much? Do you see the point? It does not make a difference if a small company would only have to pay less, but that there is no small company that can compete against a company as large and powerful as Micr
    • Microsoft, the munchkins of the corporate world!

      That was a funny gaming reference, and not even off topic.

  • Microsoft: spending those billions (Score:5, Funny)

    by mveloso ( 325617 ) on Monday April 12, 2004 @08:09PM (#8843061)
    Now everyone knows why Microsoft was sitting on all that cash: they're gonna buy their way outta trouble. Why not? It's easier for them to buy their way out of trouble.

    Andd after all that, they'll still have billions and billions lying around to cross-subsidize their money-losing ventures. Those money-losing ventures, of course, include almost everything Microsoft does except Windows and Office.

    Microsoft's new slogan should be "Innovating financial solutions to legal problems."
    • Microsoft's new slogan should be "Innovating financial solutions to legal problems."

      And with their funding of SCO, don't forget to add "Innovating legal solutions to financial problems.".

      It's a most impressive set-up, and even if Darl & co get caught by their lies, you can swear Microsoft won't be touched by the affair. They're playing their hand very well, unfortunately.

      Kjella
  • Microsoft is starting to throw money at competitors in a weak spot to kill them. It's highly anti-competive. I'd say this chicken came from the egg.
  • $440 000 000? Tiny. M$ got a contract for $470 000 000 for the U.S. military. Even if there was 5 or 6 of these big suits annually that had a half billion fine M$ would still turn a profit.

  • Astonishing amounts of money (Score:3, Insightful)

    by Sean80 ( 567340 ) on Monday April 12, 2004 @08:25PM (#8843149)
    If nothing else, this really indicates to me just how much money Microsoft has, and what a slap on the wrist the potential EU anti-trust fine is.
    • Yeah, why the fuck aren't fines calculated as a percentage of company cash/income instead of fixed amounts?

      Big companies should be fined more for illegal activities than small companies, hence, percentage fines are in order.

  • this doesn't make sense (Score:3, Funny)

    by Trailer Trash ( 60756 ) on Monday April 12, 2004 @08:28PM (#8843173) Homepage

    customers can use Microsoft products and services without a license from InterTrust.

    Wait, is this saying that Microsoft hasn't indemnified its customers against these sorts of claims? Stupifying. Anyone alerted Didiot? She might want to write an article.

  • This is bad (Score:2, Funny)

    by tsotha ( 720379 )
    Thus spake the evil wizard as he gathered a small amount of his power to summon a demon from the depths of hell:

    "I have nurtured you and made you strong. Attack my enemies forthwith and destroy all rivals to my power!"

    Shouldn't mix this cough medicine with caffeine...

  • Has anyone else noticed that Microsoft prefers to pay a lump sum for an unlimited license (with respect to users or copies of a product sold) rather than a royalty on the number of products sold/licensed? With as big a war chest as they have, I guess they don't want to owe anyone royalties on future products/development. And then they can continue using the technology in their OS'es forever . . .

    • Re:Microsoft never pays per license royalties . . (Score:5, Interesting)

      by atcurtis ( 191512 ) on Monday April 12, 2004 @09:32PM (#8843580) Homepage Journal
      It is more likely that InterTrust wanted to be paid with a lump sum instead of by royalties...

      The last company who licensed technology to Microsoft on a royalty basis ended up getting nothing from Microsoft because they gave it away for 'free' so there was no royalty to pay.

      You may have heard of them: The company is SpyGlass... the software they wrote is what you know now as Microsoft Internet Explorer.

      The directors behind SpyGlass tried to sue Microsoft - but ran out of money. So they have quit the PC Software business alltogether.

      So, IMO, InterTrust is smart to negotiate a lump sum payment... Obviously, they couldn't trust Microsoft to honor their side of a royalty-based agreement.

      BTW, there are other situations where Microsoft licensed technologies on a royalty basis and then gave them away 'free' to avoid having to pay any royalties.

  • It's pretty troublesome (Score:5, Interesting)

    by eclectro ( 227083 ) on Monday April 12, 2004 @09:22PM (#8843519)
    Here is an earlier article [seyboldreports.com] discussing the Intertrust patents, and their apparent broadness. There are links to the actual patents themselves.

    As other posters have noted, this settlement gives Intertrust a leg up on the competition (which they probably will sue now).

    It would be an interesting exercise to see if there are any publications that discuss "trusted computing" prior to the Intertrust patents.

    Also, Intel announced a mobile cpu [yahoo.com] that has a DRM coprocessor in the same package. Intel could head this direction with all their chips.

    Given all the evils of DRM, I would rather see a chip from Intel with DRM succeed, rather than using Microsoft palladium, Phoenix DRM bios, or other software component. Having it in hardware makes it a level playing field for every developer, commercial or open source. I am not saying any of it is good, only what the lesser of evils would be.

    Preferably their would be an open source competitive solution.

  • 58 Billion! (Score:3, Informative)

    by bettlebrox ( 264668 ) on Monday April 12, 2004 @09:43PM (#8843651) Homepage Journal
    2 Billion to Sun.
    1/2 Billion to Intertrust.
    Only another 50.4 odd Billion to go!

    (MS has 52.8 Billion in the bank: http://money.cnn.com/2004/02/26/technology/techinv estor/lamonica/) [cnn.com]

  • microsoft and evil (Score:1, Funny)

    by Anonymous Coward
    Incorrect usage:
    Microsoft is evil.

    Correct usage:
    Microsoft is Evil.

    Explanation:
    On Slashdot, it is insufficient to merely describe Microsoft as being evil (as in the adjective). The lowercase implies a generic description which can be ascribed to anything. Rather, you must use the proper noun Evil in reference to specific property possessed by the Dark one himself.

  • Irony (Score:3, Funny)

    by Dachannien ( 617929 ) on Monday April 12, 2004 @10:48PM (#8844056)
    Isn't there some minor irony in ripping off someone else's DRM scheme?

  • - "Lock-in? Uncompetitive? Us?" asked Steve Ballmer innocently. He dried off his sweaty forehead and continued "...but we don't OWN the DRM technology. Anyone with $440M can license it from InterTrust. If we wanted to be uncompetitive, we would have, he-he, bought the darn company. Or.. something?"
    - "Damn", said the antitrust judge.
  • But why does Microsoft support software patents legislation. They should know it better.

Slashdot Top Deals

I tell them to turn to the study of mathematics, for it is only there that they might escape the lusts of the flesh. -- Thomas Mann, "The Magic Mountain"

Close