Microsoft, Motorola and the FRAND-Principle

Only last Wednsday the mobile phone giant Motorola achieved a stage victory in its current patent conflict with Microsoft in Germany. The Regional Court of Mannheim decided that Microsoft infringes with two of Motorola’s patents concerning the video compression standard. Among Microsoft’s infringing products are the Internet Explorer, the game console Xbox 360 and the operating system Windows 7. Microsoft is ordered to pay compensations for the patent infringement and to withdraw the products from the market.

At the moment the rulings will have no effect on the consumer. On the one hand Micrisoft moved its European logistics center from Germany to the Netherlands to ensure the market supply prior to the court actions. On the other hand the Regional Court ruling has not gone into legal effect yet and Motorola might be prevented from enforcing the judgment as Microsoft itself has pending patent litigations against Motorola in the US.

However, the current judgment will probably be only one within a long row of legal actions between the two companies. But wat does the FRAND-Principle git to do with the conflict? The FRAND-Principle means that patents, which are designated as ‚industry standard‘ are required to be licensed on Fair, Reasonable And Non-Discriminatory terms. As Motorola’s patents include the the video compression standard H.264, they are considered to be industry standard and therefore must be licensed under FRAND. Part of the conflict is that Microsoft is of the opinion that Motorola’s licensing conditions are unfair. The case may still be settled amicably, if the parties will agree on a basis of „fair compensation for intellectual property“.

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