OMA washes its hands of MPEG LA licensing arrangements

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The Open Mobile Alliance is so busy ducking for cover over the proposed licensing terms of its digital rights management standard, that it has put out a statement distancing itself from the process.

If it had known that not working with the existing patent holders for most of the DRM patents was going to cause it this much trouble, perhaps it would have done things differently.

The MPEG Licensing Authority has gathered essential patents for the technology independently of the OMA.

In its statement it said, "The OMA is a specification setting organization focused on interoperability. It exists as a means for companies involved in the mobile industry to develop open, interoperable mobile specifications based on market requirements. The OMA does not have a relationship with MPEG LA and did not participate in the development of the license terms suggested by MPEG LA for OMA DRM."

The OMA falls short of actually suggesting that perhaps the MPEG LA can’t really insist on the royalty that it is requesting, by makes it clear that it is "not in a position" to determine the applicability of those patents. In other words it washes its hands of the whole thing.

It points out that as a condition of membership in OMA, member companies had to agree to grant a non-exclusive license on fair, reasonable and non-discriminatory terms and conditions, but of course Sony, Contentguard, Intertrust and Matsushita were not members, and not invited to be members of OMA, although we believe that Philips is, through its handset arm.

Two weeks ago the MPEG LA and essential patent group slashed their license terms from $1 per handset down to $0.65 and from 1 per cent of all transaction charges, to a maximum of 25 cents per user per annum in response to calls by the GSM Association who said it refused to pay the previous rates. The royalty is still expected to rise to $1bn or more per annum, even under these terms.

There is no indication yet whether the new reduced terms are any more acceptable that the first license terms to the GSM Association members, but with an avalanche of content services ready to be launched, all dependent upon sufficient DRM protection, they really have very little choice.

Copyright © 2005, Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of the week's events in the world of digital media. Faultline is where media meets technology. Subscription details here.

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