Feeds

Sony: MS already using Seattlement terms to screw us

IP landgrab

  • alert
  • submit to reddit

Internet Security Threat Report 2014

"God, this is going to be good," we thought on spotting Sony's name on the DoJ's 'major contributions' list of public comments.

And Sony hasn't disappointed. This quite sensational document opens up a new chapter in the competitive saga, and means Microsoft has a new, wealthy public opponent of a kind it's not encountered before.

Sony is the only Microsoft Windows licensee - in other words, the only Microsoft customer - who's felt brave enough to complain about the service, that the food was cold and that the menu keeps getting more expensive each time they come back.

But Sony is also a competing superpower, which owns areas (consumer playback devices such as TVs, Walkmans, cinemas, consoles) where it wants to deny a new market player from coming in and exerting any leverage.

If you can't compete in this market physically - and there's big money in these consumer devices - you have to send a proxy: and ensure the players who are there are paying you for something: a wee tax. Licenses and royalties are the proxies, and they work either because the technology on offer is fabulous, and the buyer really needs it; or through expediency, and the patent holder is holding a gun to your head: pay us, or else.

Mars attacks

In its comment, Sony accuses Microsoft of using the Seattlement condition for a uniform Windows license (Section III.B) to renegotiate Sony's license in Microsoft's favor.

Sony makes explicit its fear that: "Microsoft will use its monopoly power to force its OEM licensees to give up intellectual property rights, thus affording Microsoft the opportunity to expand its power."

From the document we learn that Sony had already anticipated this, ensuring that three specially negotiated "non-assertion convenants" exist in Sony's current Windows license which was only signed last year.

"Sony must agree to new 'uniform' non-assertion covenants that may weaken previously negotiated protections for Sony's intellectual property," writes the company.

"This raises the possibility that Microsoft will use its monopoly power to force its OEM licensees to give up intellectual property rights, thus affording Microsoft the opportunity to expand its power.

Sony proposes a kind of telephone tree, an early warning system for other OEMs. First, it wants a "baseline" set of T&Cs, with leeway for individual non-assertion covenants. Second, it wants the IP covenants - even unsuccessful covenants that don't make it into signed OEM agreements - made available to other OEMs, to protect them all from "coercion and retaliation."

What intellectual property?
As we point out above, Sony competes at both ends of the pipe in the movie and music business, generating content and controlling the playback devices.

Microsoft currently doesn't have a significant interest in the content (it's got Slate and the MSNBC
JV, but no studios or labels), and until recently didn't really care for doing anything more ambitious than try to replicate the good old DOS franchise all over again, because it knows it worked the first time. So it's been fighting using proxies.

But the appearance of the Xbox and recent promises to expand the console into a do-it-all home playback device (playing all kinds of content) have escalated the war. We're pretty sure the Xbox remains the exception - it's been a hugely expensive venture and Microsoft doesn't want to build boxes of all varieties, preferring to take a royalty rather than become a hardware design and manufacturing company.

Sony meanwhile does very nicely out of its content thank you, and doesn't see why it should pay a royalty tax when it's developed so much of the hardware and software technology in a playback device by itself. Thanks all the same.

Things get messy, though on converged devices such as the Xbox. If rivals aren't using a Microsoft operating system, they ought to be using some other Microsoft technology which now or in the future, could provide a royalty-stream, The Beast figures.

The Sony statement specifically mentions "non-operating system" intellectual property, and the smoking pistol points to file formats and share-denial technology (DRM). Allowing Microsoft to impose its own DRM technology on playback devices would put Bill Gates right into the diaries of the movies studios. It could potentially commoditize the device business and guarantee revenues from several individual markets.

Bill has never wanted to own the world, he'll settle for the the whole world to pay him a royalty, and that's an important distinction.

Now the chances of this happening are probably zero. Consumer devices, as we've seen with phones, are fiendishly specialized technology and integration, and obey their own marketing rules too.

But that isn't going to stop Microsoft trying to escalate its presence in the entertainment technology markets, or stop Sony from fearing its higher profile.

So this long litigation, which started in 1997 with the BrowserWars, is moving into really really serious territory, where the big money has always been made. ®

Related Link

Sony's public comment

Related Stories

Judge grants States access to Windows source
Mobile phone biz will resist Dell-ification - Nokia CEO

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Netscape Navigator - the browser that started it all - turns 20
It was 20 years ago today, Marc Andreeesen taught the band to play
Sway: Microsoft's new Office app doesn't have an Undo function
Content aggregation, meet the workplace ... oh
Sign off my IT project or I’ll PHONE your MUM
Honestly, it’s a piece of piss
Return of the Jedi – Apache reclaims web server crown
.london, .hamburg and .公司 - that's .com in Chinese - storm the web server charts
NetWare sales revive in China thanks to that man Snowden
If it ain't Microsoft, it's in fashion behind the Great Firewall
Chrome 38's new HTML tag support makes fatties FIT and SKINNIER
First browser to protect networks' bandwith using official spec
Admins! Never mind POODLE, there're NEW OpenSSL bugs to splat
Four new patches for open-source crypto libraries
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.