[A2k] WiFi Patent Breaks the Waves

[George Willingmyre]

Seth, a  nice posting.  GTW follows  patent policies of SDOs striving to
address these sorts of problems.

See another story on same topic.   I  attend IEEE patent committee meetings.
IEEE has proposed a new policy that will allow patetn holders to provide
specific terms and conditions  ex ante.  This week and next the  Patent
committee and the Board of Governors will likely approve the new policy
subject to any comments from DOJ on a request for a business review letter
of the new procedures at
http://grouper.ieee.org/groups/pp-dialog/drafting-committee/index.html

George T. Willingmyre, P.E.
GTW Associates
1.301.421.4138
www.gtwassociates.com



Wi-Fi standards face patent threat

http://news.com.com/Wi-Fi+standards+face+patent+threat/2100-7351_3-6137372.html?tag=html.alert

Companies working with popular standards for wireless technology may have a
patent infringement problem.

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--if
it survives what many assume will be a lengthy appeals process--could have a
wide-ranging impact on wireless equipment makers and consumer electronics
manufacturers.

Judge Leonard Davis ruled that a patent granted in 1996 to the Commonwealth
Scientific and Industrial Research Organisation (CSIRO), Australia's
national science agency, is valid. The patent describes the implementation
of several aspects of the 802.11a and 802.11g wireless standards developed
by the Institute of Electrical and Electronics Engineers (IEEE). The court
also ruled that Buffalo Technology, a small maker of Wi-Fi routing gear, had
violated this patent.

The judge in the case issued a summary judgment, which indicates the court
is wholly convinced by the evidence, to the point where there are no
questions of fact. In general, a summary judgment is rare in patent
disputes.

The ruling is certainly a blow for Austin, Texas-based Buffalo Technology,
which--unless it wins an appeal--could be forced to pay between $1.5 million
and $2 million in damages to CSIRO. But the decision, which essentially
upholds the notion that CSIRO owns the rights to widely used standards-based
technology, could have a huge impact on the entire Wi-Fi industry,
particularly as companies start embedding Wi-Fi chipsets into consumer
electronics devices like music players and mobile handsets.

"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."

More than 100 companies could end up paying royalties to CSIRO for use of
the technology, claimed Daniel J. Furniss, a partner at Townsend and
Townsend and Crew, the law firm representing CSIRO. Furniss said that CSIRO
sued Buffalo first because the company wouldn't meet with them to discuss
their claims. He also wouldn't specify how much money his client could
expect to generate from any future license agreements. A Buffalo Technology
representative could not be reached for comment.

In 2005, an estimated 140 million to 155 million Wi-Fi-enabled devices
shipped, according to ABI Research and InStat, market research firms. That
number in 2009 is expected to balloon to 450 million devices shipped. At the
end of the day, patent licenses for all these products could generate a
significant amount of money.

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 $1.9 billion in 2006, according
to ABI Research. That figure is expected to jump to $3.7 billion in 2010.

Because Wi-Fi chips cost only a couple of dollars, the technology is popping
up in all kinds of new devices. It is also one of the reasons that many
consumer electronics device makers are embedding Wi-Fi into devices instead
of technology like Bluetooth.

For example, Microsoft's new Zune music player uses Wi-Fi to allow people to
share music. And many mobile handset makers are starting to introduce phones
that can switch between Wi-Fi and cellular technology. T-Mobile just
introduced the Dash, a so-called dual-mode handset, in the U.S. this fall.
Most of these products comply with the 802.11a and 802.11g IEEE standard,
which CSIRO claims is included in its patent.

CONTINUED
----- Original Message -----
From: "Seth Johnson" <seth.johnson@RealMeasures.dyndns.org>
To: <ecommerce@lists.essential.org>; <a2k@lists.essential.org>;
<upd-discuss@lists.essential.org>; <commons-law@sarai.net>
Sent: Sunday, November 26, 2006 12:41 AM
Subject: [A2k] WiFi Patent Breaks the Waves


>
>> 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.
>
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