The Recursive ISV

 I’m not a great fan of software patents.  Having said that I’m not entirely opposed to them either, it’s just that some patents seem to be totally off the planet in terms of how they want, or the amount of dollars they want, from you in order to comply.

Take the old UniSys GIF patent.  The GIF file was embraced early on as an image format for websites. Before the so called dot com crash most sites used GIF.  UniSys got greedy, very greedy.  UniSys originally promised Compuserve that there would be no encumbrance on using GIF.  A few years later UniSys changes their mind.  After a huge outcry (and a bit of a battle with Compuserve) UniSys decided that they would only charge commercial entities for GIF.  The online world calmed down and GIF use continued, even though there were alternatives like JPEG and PNG which in many ways were superior. 

However UniSys again changed their mind in 1999.  Everybody must pay or face litigation for patent infringement.  That meant it didn’t matter if you created the GIF yourself, paid someone to do it, used a “licensed tool” to create it and/or just showed the GIF in a webpage.  Minimum license fee for non commercial use was $5000 and they did not consider websites falling under that category.

The GIF patent held by UniSys expired on June 20, 2003.  But, by and large GIF is pretty much dead now with sites embracing JPEG and more recently the superior PNG (which is free from patent encumbrance), increasingly since Microsoft fixed PNG bugs in Internet Explorer.

Fast forward to 2008.  The technically inferior (just like GIF was in its day) MP3 format is in widespread usage.  It’s probably fair to say it’s bigger than GIF (a similar statement from John Lennon regarding the Beatles once caused folks to burn their Beatles records.  I’d be happy enough if you did the same with your MP3 files.).  This sonically degenerate audio file format is used by tens of millions to listen to music – proof positive that the average person is incapable of hearing or at least recognizing and processing the full audio spectrum available to the human ear.  That’s not a criticism of the average person, it’s equally true they do not have the training or equipment or even the time to pay attention to something better. 

However the point is we are stuck with MP3.  There are several stake holders to the MP3 patent arena.  The most notable being Fraunhofer, AT&T-Bell Labs, Thomson-Brandt, CCETT and Alcatel-Lucent with most well known being the arrangement via Thompson which collects on behalf of several stake holders.  More recently Alcatel-Lucent went after Microsoft but their original win was over turned.  Alcatel-Lucent tried to argue that it has patented technology that was not part of patent covered by Microsoft’s payment to Fraunhofer/Thompson.  This whole debacle made the UniSys problems seem incredibly simple.

But here’s the point of this blog post.  Thompson used to limit the amount of money payable to them under a certain value (from memory – could be failing me here – it was around $10,000).  Now $10,000 is the *minimum* payable for royalties based on sales.  You pay separately to read, write, distribute, stream and so on and so forth.  This is totally ridiculous.

You work on a file format, make it a standard and then screw everybody who adopts it (most of the world).  But here’s the kicker.  Only part of the world is screwed.  You see if you’re in the so called “Western World” which for the purposes of definition (though not geographically correct) includes the USA, Western Europe, UK, Ireland, Canada, New Zealand and Australia then you pay and you pay big.  However.  If you’re from the “rest of the world” you pay nix, nada, nothing.  That’s because pursuing patent infringements in those countries is pretty much like playing darts in the dark.  Hence the plethora of mutli-media software (mostly DRM busting to boot) coming out of those regions – with complete and utter impunity. If you knew how many of these DRM busting programs I reject on a newsgroup I moderate you’d be amazed. 

Effectively what this crazy cost of compliance does is limit the market to players who have the bucks (who are most likely eventually to break reliance on the patent through development of their own standard anyway, like MS or Apple etc) or to those who can flaunt it with impunity.  Stifling the very people most likely to earn the patent holders a dollar.

So why not drop MP3 and code for one of the non patent enforced alternatives like OGG etc (and there are many and some better than OGG).  Simply because of market inertia.  The consumer is consuming MP3’s.  Their players play MP3 (very few support OGG or other formats) and getting the consumer to switch is and always will be a tough thing.  Especially when the problems of the format do no affect them directly, or as far as they are concerned, indirectly.  

I don’t believe software patents should be outlawed (as some suggest).  But I do believe that the way in which some patents are implemented smacks off price gouging and in any other situation would be declared illegal.  It’s about time something was done to end the price gouging, not the registration or reasonable collecting of patents.

I’m working, as I mentioned in a recent post here, on a new mISV that will work within the multi-media region.  MP3 is a big sticking point.  I’m seriously considering not supporting it directly from the software.  This is a *huge* decision to make.  While my mind is not yet made up, I have to say I’m 75% there in terms of making a decision.  I originally intended to happily pay the patent royalty to Thompson due to consumer reliance on MP3.  However the recent changes to licensing and royalties make this pretty damn hard, read to bloody expensive, for a startup.  Frankly that sucks, but one is left with only two options.  Pay and support, or don’t pay and don’t support the format.  There is a third, read the format via the WMP API from Microsoft, however Thompson’s advice is that ISV’s are not covered using that method.

If only Apple and Microsoft would have the balls to embrace an open, patent free standard like OGG (or one of the many others) and literally wipe out MP3 almost overnight.

More information can be found on the UniSys GIF patent at:

http://www.silverglass.org/rants/unisys-gif.html 

Thompson Patent at:

http://mp3licensing.com/royalty/software.html