Microsoft and Patents

Introduction
Microsoft Patents at the European Patent Office (EPO)
Annotated Links

introduction

Microsoft Corporation grew large and successful without patents, relying instead on copyright. In 1991, Microsoft CEO Bill Gates warned that patents could bring the software market to a complete standstill and drive out small players. In 1994, Microsoft was the only software company at the USPTO hearings which spoke in favor of software patentability. Meanwhile, Microsoft had been stepping up efforts to build a patent portfolio to counter the much larger portfolios of traditional IT hardware companies such as IBM, HP, Canon etc. When the patent lawyers at the European Commission pressed for legalising software patents in Europe in 1997, they cited Microsoft as a success model, pointing out that Microsft already owned 400 software patents. In late 1998, an internal Microsoft stratgegy document about the "opensource threat" leaked out which suggested using software patents alongside with proprietary standards in order to crush competition from free software such as Apache and Linux. In 2000, Microsoft forced a free sofware project to abandon support for its patented video streaming format ASF. In 2001/07, in the midst of an ongoing campaign against free software, a leading MS executive challenged opensource companies to keep clear of Microsoft patents or else "Get your money and let's go to court!". In 2002/03 Steve Ballmer, CEO of Microsoft, declared that Microsoft's new standard DotNet was protected by patents and free implementations would not be allowed. In 2003/04 Microsoft published patent license terms for CIFS which disallow the use ore reimplementation of this communication architecture by GNU software. In late 2002, Microsoft began dissuade corproporate customers from introducing GNU/Linux by pointing out that if they use free software nobody would protect them from being sued for patent infringement.

Until June 2003, Microsoft largely abstained from public comments on European patent policies. In small-circle discussions at Bitkom, where IBM patent lawyers pushed vocally for far-reaching patentability, the Microsoft representative remained almost silent but tacitly supported the IBM patent department's hard line. At another association, Verband der Software-Industrie e.V. (VSI) und Logikpatente, Microsoft's pro patent involvement was more overt. In France, Microsoft representatives have exerted pressure on associations such as Syntec Informatique not to oppose software patents. The Business Software Alliance (BSA) had Microsoft's full support when it worked on the software patentability directive for the European Commission (CEC), which CEC adopted almost without modification. German Microsoft representatives have, as a part of their anti-Linux campaign of 2002 at the Federal Parliament, been asking politicians in Berlin to support the CEC/BSA directive proposal. One Microsoft paper circulating in Berlin based its arguments mainly on the TRIPs fallacy.

Microsoft Patents at the European Patent Office (EPO)

Annotated Links

EU Boosts Microsoft's Monopoly

The European Commission's competition procedings against Microsoft have led to a verdict which gives a big boost to Microsoft's monopoly position in the OS market and helps Microsoft expand this position to other markets. While the Commission may have earned substantial revenues for itself by imposing a one-time fine of 1% of Microsoft's liquid cash reserves, the smallprint of the verdict gives Microsoft green light to kill its main competitors in the operating systems market. This smallprint was simultaneously reinforced through backroom deals in the Council's Patent Policy working party, of which copies have been leaked to FFII. Immediately after the announcments the stock value of MSFT rose by 3%.

Danish Campaign against Europarl Amendments

Computerworld.dk has an article titled "Open source destroys danish innovation" which reports about "3 innovative danish SMEs" who went to see the government to complain about the European Parliament's amendments to the directive, saying that the EP made it impossible for them to protect their intellectual property. This was echoed by a FUD campaign of major danish IT associations, similar in tone to the Computerworld article. Preliminary research shows that the SMEs in question are all close allies or subsidiaries of Microsoft. None has publicly pointed to any case studies to demonstrate a legitimate need of their business for any kinds of software patents. Like the 5 Telecom CEOs, they have shunned public discourse and relied solely on secretive lobbying.

Phelps spells out his Microsoft vision

Microsoft's new chief patent lawyer spells out his vision of maximising patent rents and lobbying the European Union to legalise software patents.

Hired in June, Phelps has been brought to Redmond from his home in Connecticut to spark the kind of licensing programme he inspired at his previous company, IBM, which is now reaping almost $2 billion a year from licensing its patents. But Phelps is in charge of more than just the company's licensing. In his new role he oversees all aspects of Microsoft's IP department, from the number of paralegals on its staff, to its relationship with external law firms and national governments. Phelps's appointment has seen the company move into a more aggressive mode of viewing the IP world, what Phelps calls a new "outward-facing" approach. This involves not just making money from research and development (R&D

, but also engaging with the EU on the shape of its proposed software patent directive, and lobbying the US Congress to end the diversion of USPTO funds.

...

In Europe, for instance, the past few months have been dominated by the controversy surrounding the future of a European software patent directive. Following September's vote in the European Parliament, the EU's proposals for the patent are falling some way short of what many corporations would like to see, allowing for patents on inventions that affect the way hardware works, but not for software itself. "We'll focus on Europe that bit more," says Phelps. "Again, I think we've been way too US-centric, and I don't think we joined the debate [on software patents in Europe] in the right way."

...

"My concern with Europe is that what they're going to do, writ large, is develop an industrial policy for this kind of thing in Europe. The US isn't following that. The US is off to the races on software patents and that's not going to be turned around anytime soon, if ever, and so is Japan. And why Europe would want to be uncompetitive with those two areas of the world, I really don't know."

...

"I think there's a fundamental lack of understanding [in Europe] that there isn't a real difference between software and hardware. I also think there are large political forces driving this issue. For some reason, it has caught the attention of the Greens, and I'm not clear why. But that's true of this country too, where [consumer activist and Green Party presidential candidate in 2000] Ralph Nader is involved with the Open Source movement. Some on either side approach these issues with an almost religious fervour.")

Microsoft Germany Windows vs Linux Brochure 2003 (Uses the argument that patents put GNU/Linux at risk and that companies are on the safe side if they use MS Windows instead.)

http://kwiki.ffii.de/AmccarthyEn

Arlene McCarthy, MEP of the UK Labour group, who championed the cause of software patenting, was usually surrounded by a swarm of lobbyists from the European Patent Office, the European Commission's industrial Property Unit as well as patent lawyers and lobbyists of large corporations. In some of her public statements McCarthy mixed up the case for software patents with the case against the GNU GPL, calling the latter "just another form of monopoly", a kind of statement which only Microsoft would make. In summer 2003 McCarthy and other MEPs who meet at the "European Internet Foundation", a lobbying group of large companies aiming to provide "political leadership for network society", travelled to Seattle with a group of MEPs to visit Microsoft. After the hearing on software patents of 2002-11-07, McCarthy sat at a table with the Microsoft representative in Brussels and put the other witnesses and experts to marginal tables.

Microsoft Communications Protocol Program Licensing Home Page

says that patent licenses needed for communication with Microsoft applications will be given on a "reasonable and non-discriminatory" basis, i.e. not for free software.

Microsoft Communications Protocol License Terms

details of Microsoft license terms for use of its patented protocols

Microsoft Published Protocols List

List of protocols for communication with Microsoft applications for whose use (patent) license fees must bee paid.

The Register 2002/11/18: MS suggests Linux could infringe patents

In a magazine article, the CEO of Microsoft Israel, Arie Scope, warns customers that by introducing Linux they risk running afoul of patents and advises them to seek indemnification from suppliers such as Redhat in the event of patent infringement. This article provides a response to open source initiatives in Israel. In the article, Scope says:

IBM is not developing its own version of the Linux OS. Rather than that it distributes Red Hat's version and clears itself from any liability in case the customer changes the code. I advise organizations to review the licensing agreement of Red Hat distributed by IBM, and ask the company for legal protection if it turns out that the OS infringes patents.

(Steve Ballmer: Kein Tänzchen an der Leine)

Heise report about Steve Ballmer's talk at CeBit. At a speech event together with chancellor Schroeder, Ballmer says that Microsoft owns lots of patents which cover its new DotNet standard and that it aims to use them to prevent opensource implementations of DotNet. The key phrases read, in translation:

Responding to questions about the opening-up of the .NET framework, Ballmer announced that there would certainly be a "Common Language Runtime Implementation" for Unix, but then explained that this development would be limited to a subset, which was "intended only for academic use". Ballmer rejected speculations about support for free .NET implementationens such as Mono: "We have invested so many millions in .NET, we have so many patents on .NET, which we want to cultivate."

Microsoft 2001-07 to opensourcers: %(q:Get your money and let's go to court)!

News report about a public discussion at the "Open Source Convention" between Microsoft executive Craig Mundie and well known representatives of the free software community in July 2001.

Asked by CollabNet CTO Brian Behlendorf whether Microsoft will enforce its patents against open source projects, Mundie replied, "Yes, absolutely." An audience member pointed out that many open source projects aren't funded and so can't afford legal representation to rival Microsoft's. "Oh well," said Mundie. "Get your money, and let's go to court."

The article goes on to speculate that the Mono and Samba projects could be among the first victims of this Microsoft strategy. E.g. US Patent 5,719,941 - the "method for changing passwords on a remote computer" applies to a new password-changing feature in SMB which is necessary in order to maintain full interoperability between Microsoft clients and Linux fileservers in typical company networks. The article is hidden behind passwords, accessible only to subscribers. It is marked as written by Rachel Chalmers on 2001-08-08.

2001-07-24 Opensource Summit and Microsoft

Discussion thread on this event, where the MS representative stated the intent of his company to use patents against free software.

Pierre Bugnon: Petite Digression

Microsoft France speaker explains that Microsoft is an innovative company and the proof of this is the number of 2110 US patents which Microsoft already owned by 2001-10-31.

Microsoft bars GNU software from interoperating with CIFS

During the 1st week of April 2002, Microsoft published a license for its new specification CIFS which it is trying to establish as a de facto communication standard. This license says that free software under GNU GPL, LGPL and similar licenses may not use CIFS. It bases this ban on two broad and trivial US patents with priority dates of 1989 and 1993. Preliminary search results suggst that these patents to not have EP (European Patent) counterparts. But there is nevertheless an EP patent which could possibly be used by MS for the same purpose. Critical network infrastructure such as Samba as well as new projects such as Mono seem to be affected.

ASF: changing copyright rules by means of patents

Microsoft has prohibited a Free Software programmer from writing import/export filters for its Advanced Streaming Format (ASF). The programmer wanted interoperability with a format that Microsoft is promoting. But for Microsoft, interoperability is in this case doubly disadvantageous: besides reducing the lock-in effect, on which Microsoft's platform strategy relies, it also can circumvent the locks on unauthorized copying, by which Microsoft wants to attract content providers to its ASF platform. Whereas in the DeCSS case a court ruling was necessary to enforce new draconian copyright provisions of the highly disputed Digital Millenium Act, in the ASF case a simple patent suffices to achieve the same legislative goal.

(Noam Chomsky on Microsoft and the rise of private tyrannies since Madison)

(Microsoft patent on distributed file systems 1999)

Microsoft: GPL destroys intellectual property

A fairly well written article that gives a lot of space to Microsoft FUD about the "viral" nature of free software. Microsoft has been advocating this in more aggressive ways since 2000. They forget to mention that free software makes it easy to develop proprietary complements and the GPL doesn't forbid anything that proprietary software would allow.

Microsoft patent on distributed file systems 1999

Halloween Documents of 1998

Internal strategy papers from Microsoft, suggest that opensource software could be combatted by creating proprietary extensions to Internet protocols and by patents: "Linux's homebase is currently commodity network and server infrastructure. By folding extended functionality (e.g. Storage+ in file systems, DAV/POD for networking" into today's commodity services, we raise the bar & change the rules of the game.) ... "The Linux community is very willing to copy features from other OS's if it will serve their needs. Consequently, there is the very real long term threat that as MS expends the development dollars to create a bevy of new features in NT, Linux will simply cherry pick the best features an incorporate them into their codebase. The effect of patents and copyright in combatting Linux remains to be investigated."

Heise 2002-12-14: Microsoft DRM Patent

German news report about Microsoft patents on principles of Digital Restrictions Managment

(Microsoft-Betriebssysteme mit eingebauter Hintertür)

http://kwiki.ffii.de/TheregisterSco030113En

(Microsoft Electronic Asset System Patent)

(Microsoft P3P Patent)

This patent caused trouble for the W3C in 1999

Gates 2002-04: GPL will eat your economy

GPL Pacman will eat your business, warns Gates

Open source terror stalks Microsoft's lawyers

Perens, Stallman, Raymond et al: Free Software leaders responding to Microsoft's FUD campaign

(The Microsoft Antitrust Trial and Free Software)

(Microsoft honous Linux programmer with patent gong)

The Microsoft DRM Patent and our freedom to speak and think

Gerhard Schröder

Der "Genosse der Bosse" hat bekanntlich ein besonders offenes Ohr für die Einflüsterungen hoher Wirtschatsfunktionäre und insbesondere eine anhaltende Neigung, sich an Seite von Microsoft-Führungskadern öffentlich zu zeigen und stolz auf Partnerschaften mit MS zu sein. Seine Herkunft aus dem Anwaltsberuf, seine Orientierung an anglo-amerikanischen Vorbildern (bei relativer Distanz zu Frankreich) könnte für Software-Urheber und -anwender ebenfalls Anlass zu Sorge sein: in Frankreich fielen die Entscheidungen gegen Softwarepatente auf der Ebene des Premierministers. Bislang hat sich Schröder zum Thema Softwarepatente, soweit bekannt, nicht geäußert, aber sein Verhalten im Zusammenhang mit der Kopierschutzrichtlinie lässt wenig Verständnis für informationelle Infrastrukturen erwarten.


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