Microsoft v. TomTom – First thoughts

Given the size and notoriety of the two companies, it’s clear that this will get a lot more attention the hundreds of other patent suits that happen every year.
From the news reports and information on Microsoft PressPass it appears that Microsoft has already licensed the patents to Alpine, Pioneer, 123Map and Kenwood, and been discussing these patents with TomTom for months before launching the suit. TomTom has a patent portfolio of its own and has used it to sue Garmin and Toyota for infringing its patents in the past. And while battles between patent holders are commonplace, this one includes a dispute over some pretty significant Microsoft-held patents that may have broader implications.

As regular readers know, ACT believes that IP licensing agreements will play an increasingly important role in our industry as everyone focuses on delivering interoperability across devices and platforms, while still protecting investments in research and development. 

As many SMEs have found, attempts to negotiate license deals sometimes fail and leave the IP holder with little other choice but to bring legal action.
While it is unclear where this litigation will lead, it does seem to be a good opportunity to focus on the importance of patents to software innovators of all sizes. 

Based on what the articles I have read and a quick skim of the complaint, Microsoft seems to be in the position so many entrepreneurs with patents find themselves in: another firm is infringing on its core innovations and is unwilling to discuss licensing terms. While this is an “issue” for a company like Microsoft that has thousands of patents, it is “critical” for startup that has three. 

When we've done focus groups and member polls, the vast majority tell us that a predictable and accessible intellectual property system is critical in creating the incentives necessary to drive innovation and entrepreneurism.  In simplest terms, IP helps to get them paid for innovating.

And Innovation, after all, is one of the fundamental components of progress and growth in the IT industry. It serves as an essential foundation for the delivery of great new products, spurring economic growth and furthering R&D. As we wrote about in our National Policies as Platforms for Innovation paper, IP is a key ingredient to enable innovation to flourish. Businesses large and small need to know their patents, copyrights and trade secrets are protected in order to enable returns on their investments.