Collaboration, Competition and IP in the Real World

In the last few days Microsoft has made a number of announcements that reflect the pragmatic approach the company takes on intellectual property rights and open source software. 

  • On July 20, Microsoft announced the release of 20,000 lines of device driver code to the Linux community.  The code, consisting of three Linux device drivers, was licensed under the GPLv2 license and submitted to the Linux kernel community for inclusion in the Linux tree.
  • Similarly, on July 21, Microsoft announced the release of the Microsoft Live Services Plug-in to integrate Microsoft’s Live@edu services with the Moodle course management system. This plug-in is a free download specifically designed for Moodle, and was also licensed under the GPLv2 license.  
  • Earlier, on July 15th, Microsoft announced a patent agreement with Melco Group, maker of the Buffalo-branded devices, under which Melco’s customers receive patent covenants for their use of devices running Linux and related open source software, in exchange for the payment of royalties to Microsoft. 

Some observers question how a company can contribute to open source projects while, at the same time, insisting on respect of its intellectual property rights by its competitors.  In fact, these two things are not inconsistent, and striking a balance between them is one of the key things every commercial technology company must do in order to compete effectively in a mixed source world.

Microsoft has been consistent in its approach to the issue of IP and open source software.  We have shown our openness to licensing our patented inventions on commercially reasonable terms even to our direct competitors.  Far from an anomaly, the Melco patent agreement comes on the heels of more than 500 patent license agreements signed since the adoption of Microsoft’s open patent licensing policy in December 2003, with companies of all sizes, in all geographies, including other open source and mixed source software distributors like Novell, Xandros, TurboLinux, Samsung, LG Electronics, Fuji-Xerox, Brother, TomTom and Kyocera Mita.

An objective observer looking at these developments should take them for what they are:  real-life proof of Microsoft’s desire to build new bridges among industry partners for the benefit of customers, relying on patent licensing agreements as a means of opening up collaboration opportunities by ensuring mutual respect of IP rights and the innovations they protect.  This approach is not unique to Microsoft, but is instead the prevalent model for enabling open innovation in the technology world, consumer electronics being an excellent case in point.  IP licensing will also continue to play a key role in facilitating the emergence of new categories of exciting devices that embody the convergence of previously disconnected technologies, such as new generations of mobile phones, mini computers like netbooks and smartbooks, and eBook readers.

Some, however, choose to see an apparent contradiction in our actions, and view even an amicable patent agreement like the one with Melco not as the pragmatic, mutually beneficial solution to IP issues that it is, but as an assault on the philosophical tenets of free software.  It would seem that for them, IP issues should remain unresolved unless the IP holder is prepared to completely surrender the fruits of its investment in innovation. 

There is, in fact, no contradiction in Microsoft’s actions.  In the real world, the same companies can — and frequently must — simultaneously compete and collaborate.  Here too, technology companies have to strike a balance between collaborating to tackle difficult technical challenges common customers care about, and competing with one another by offering differentiated products that give customers real choice.  Taking purely ideological positions does not work in real life.  Instead, flexibility and nuanced approaches to complex problems will tend to win the day over dogmatic approaches.

Like the vast majority of businesses operating in today’s mixed source world, we are focused on creating pragmatic solutions to real-life problems that matter to real customers.  Intellectual property licensing is and will continue to be part of those solutions.

 

About the Author

Deputy General Counsel & Corporate Vice President, Legal and Corporate Affairs, Microsoft

Horacio Gutiérrez is Corporate Vice President and Deputy General Counsel in charge of the Microsoft products and services group (PSG). In this role, he oversees the team that provides front-line legal support to all of Microsoft's engineering and marketing teams, including Devices and Studios, Applications, Services and Dynamics, Operating Systems, Cloud and Enterprise, and Marketing. Previously, Horacio led the worldwide intellectual property group, including the development, maintenance and enforcement of the company’s IP portfolio, inbound and outbound patent licensing, and IP legal and public policy strategy. Prior to his eight years leading the IP group, Mr. Gutiérrez was based in Paris, where he was Microsoft's associate general counsel for Europe, the Middle East and Africa. Mr. Gutiérrez started his career at Microsoft in Fort Lauderdale, Fla. at the company’s Latin American regional headquarters, where he was responsible for commercial and corporate matters for the region.