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MS listens to PC OEMs – two years later

Nothing to do with investigations, honest...

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Microsoft has described its removal of the 'you can't sue us' clause from its licensing deals just as the Japanese Fair Trade Commission took an interest in it as "pure coincidence" - but if so it's a very strange coincidence indeed. The clause in question is the 'non assert' clause in the company's arrangements with PC companies, and it means that these companies have to agree not to enforce hardware patents that relate to Windows software - i.e., if they add innovation to their PCs, they're effectively handing the rights over to the general Windows cause, and if they don't sign, they don't get the Windows licence.

But no more - Windows licence agreements from August onwards will not contain this clause. According to Microsoft, the company "recently reviewed this provision again after receiving comments on it from some of its OEM customers." Which is nice, kind, and true, after a fashion. Microsoft did receive comments from one OEM in particular, Sony, in January 2002. This comment, a long and detailed argument on the subject of forced IP theft, came to Microsoft via the commentary period at the tail-end of the MS-DoJ settlement. Sony objected long and loud to this very clause, and complained that Microsoft was at that time forcing it to comply with the "uniform" licensing contracts. Previously, Sony had managed to hold out, but Microsoft was throwing its weight around more after the DoJ had negotiated the deal that was supposed to control it.

In a statement, Microsoft claims that the clause had passed muster with the European Commission in 2001, the DoJ in the mid-90s and with the DoJ again in the antitrust action. The Commission begged to differ earlier this week, and Microsoft fails to mention that it didn't pass muster with Sony. But the Commission didn't take action in 2001, Sony's objections in 2002 didn't have any impact, and it's only now that Microsoft's seen fit to react to OEM representations.

The European Commission did however begin investigating Microsoft's relationships with PC companies in October of last year,with specific reference to IP licensing, while last month the Japanese FTC raided the company's Tokyo office as part of a similar investigation.

So, nobody forced Microsoft to drop this kind of clause at the time of the consent decree, the DoJ didn't do anything about it again in 2002, the Commission didn't start doing anything about it until October, and it didn't start getting seriously hot in Japan until last month. But it's a coincidence, and given that Microsoft claims it's all perfectly legal in all three territories, we presume all of the OEMs have been saying nice things about the clause to Europe and Japan. After all, if they haven't complained (apart from Sony) for 15 years or thereabouts, according to Microsoft, they must be happy, right? So it's a puzzle why it's being dropped. ®

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