FRAND, Uncertainty & Doubt

It’s been interesting to watch the latest patent litigation between Microsoft and Motorola. The judge’s opinion has been well documented (see Groklaw’s copy here and an annotated one there over at the Essential Patent blog). Now I’m not going to offer an informed  legal perspective in this post and by the way, “IANAL”. What I’m expressing here are the views of someone who’s been in the I.T. industry, the field of digital standards and Free Software for over a decade.

FRAND has had until the end of the month of April 2013 no definition. What “Fair” , let along “Reasonable And Non Discriminatory” terms mean had no agreed definition. Worse, it had no definition at all. It is the first time that a U.S. judge is struggling with this matter and while it is applied to a specific case only (the use of patents in the H.264 codec claimed by Motorola to be used by Microsoft in its products), it is nonetheless interesting to see someone actually tried to evaluate the claims and lay out a specific assessment.

Reading Groklaw you will see that  to some observers think Microsoft got the upper hand and got a good deal out of the judge. That might be true or not, but I think it is somewhat missing the point.

  • There is still no definition of what FRAND terms mean. 
  • This piece of opinion implicitly shows again that FRAND terms are by their very nature incompatible with Free & Open Source Software licenses: It is not a matter of money, but the notion that terms dictate that the licensee agrees to the existence of the said patents and that these patents have to be licensed, even on a free basis to each licensee by the patent holder (who can of course refuse, demand payment or impose some other conditions to the licensee).
  • Somebody wrote that business is all about certainty. In a sense, innovation requires certainty with respect to the environment it springs from in order to be meaningful and to have something to disrupt. Well, if this judge’s opinion shows and tells us anything, it’s that FRAND licensing (and RAND licensing is just the same) is nothing but certain and has no clear rules nor accepted definition.  Because of that, it puts a threat on innovators, developers and ends up restricting choice for consumers, citizens and governments.

The lack of certainty in patent licensing seems to have become a major legal and business hurdle in innovation-oriented businesses in the US. In some ways, patent trolls, the endless “mobile wars” of hardware manufacturers and operating system developers have changed the perception of U.S. courts more than any speech about the freedom to innovate and the principles at the core of Free Software. If that’s a sad thing or not does not matter too much in the end, but it may well be the combined absurdity and the absence of legal definition of FRAND terms that prompted Judge Robart to write his opinion. Regardless of how brilliantly his document was drafted, it will be in practice little more than a band aid applied over a  clutch (the case at hand between Motorola and Microsoft notwhistanding). If you need all this time to even start to ponder on what licensing terms actually mean in an industry that has used them for about 30 years then something’s fundamentally broken with the system.

I hope we could all remember that when the next pundit will claim somewhere on a stage in Brussels or in a policy document that FRAND is the most conventional, the most practical and the most widely accepted patent licensing mode. While this might be the case, it is also the most broken one, and if it does not help the U.S. innovation, it will certainly not help any kind of economic recovery (haha!) in Europe.

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