[A2k] WiFi Patent Breaks the Waves

[Seth Johnson]

> http://www.sda-asia.com/sda/features/psecom,id,764,srn,2,nodeid,4,_language,Singapore.html


Wi-Fi Faces New Patent Woes


A federal judge in Tyler, Texas, ruled last week that an
Australian government agency holds the rights to patents on  the
underlying technology used in two Wi-Fi standards and a  third
proposed standard. The decision could have a  wide-ranging impact
on wireless equipment makers and consumer  electronics
manufacturers.

Australias Commonwealth Scientific and Industrial Research
Organisation filed a patent in 1996 that it says is employed  in
some IEEE standards, potentially including 802.11. The  group
said that Microsoft, Dell, HP, Intel, Apple, and Netgear  have
initiated legal action in an attempt to overturn the  patent. The
organisation says it intends to fight the action.

This isn't the first time a company or organisation has tried  to
pursue companies in the 802.11 space for patent  infringement.
Last year a patent buying firm called Acacia  began sending
letters to access point makers that use redirect  technologies,
saying those firms owed royalties for a patent  Acacia owns on
redirect technologies. Its unclear how  vigorously Acacia
followed up on its pursuits, but the move  caused an uproar in
the industry.

The question remains why the Australian organisation is  deciding
to pursue this patent at this stage in the market.  While
companies must be able to reap the rewards of their own  research
and development, there also must be consideration for  the
positive effects that low cost products can have on a  market.

"One reason that Wi-Fi has proliferated as it has is because
it's reached a point where it's incredibly cheap, so it's easy
to just stick a Wi-Fi chip in a consumer electronics device,"
said Stan Schatt, a vice president at ABI Research. "But if  the
cost of the technology goes up to pay for the license,  even a
little bit, it could throw off the economics."

Indeed, Wi-Fi products generate billions of dollars in revenue
for equipment makers. Just the access points that provide the
actual Wi-Fi signals in local area networks are expected to
generate USD 1.9 billion in 2006, according to ABI Research.
That figure is expected to jump to USD 3.7 billion in 2010.