WiMAXis still too expensive for Ordinary Filipinos

By Victoria Ho, ZDNet Asia

28/04/2009

The price of WiMax CPEs (customer premise equipment) must fall to a cost-effective level for operators before the masses in rural areas of the Philippines can access the wireless broadband standard.

According to Happy Communications' CTO Raul E. Ocampo Jr., the current price of CPEs still prohibits operators from recouping their investments because of the low ARPU (average revenue per user) from the country's consumer demographic.

The Filipino WiMax operator's current user base consists of enterprise customers, making monthly ARPU of US$800 to US$1,000. Ocampo estimated consumer monthly ARPU to be that of around US$25 to US$30.

"CPEs need to get cheaper than US$100 to hit the sweet spot. Then WiMax will be a sure success," said Ocampo.

Manufacturers also need to shrink the size of current CPE models so they are "not so bulky", he added.

Happy Communications intends to roll out a consumer service in the fourth quarter of this year, but Ocampo said it is "not in a hurry".

He explained that customers in the Philippines do not display much brand loyalty to operators, so winning customers over when entering the market later will not be as challenging, and will also give the operator time to build out its infrastructure.

Operators eyeing the rural opportunity
With just 1 percent of broadband penetration seen in rural areas in the Philippines, Ocampo said opportunity is very high for WiMax operators.

Currently, broadband service is limited just to "key urban areas", he said.

Ocampo expects rural broadband connectivity to bring opportunities in VoIP (voice over Internet protocol) usage, with many looking to make cheaper long distance calls to Filipinos stationed overseas. Distance learning is another aspect of interest.

Philippe Berard, director of business development at wi-tribe, too spoke on the opportunity in the Philippines for the operator.

Berard said the country's regulator had put in a "pro-competition, pro-transparency" licensing model, making it easier for an overseas operator like wi-tribe to come in.

Communicating online is also building momentum in the Philippines, and the device ecosystem is building up. More Filipinos are buying laptops, and the government has helped stimulate PC penetration through price subsidies, he added.

With these factors, Berard said Internet penetration is expected to hit 33 million--33 percent of the population--by 2013.

"There is a large pent-up demand for broadband [because] there is no DSL (digital subscriber line) network and the copper network is poor," he said.

Both Berard and Ocampo were speaking at WiMax Forum Congress Asia '08, held in Singapore

Knockoff Cellphones made a hit sales in China

SHENZHEN, China — The phone’s sleek lines and touch-screen keyboard are unmistakably familiar. So is the logo on the back. But a sales clerk at a sprawling electronic goods market in this Chinese coastal city admits what is clear upon closer inspection: this is not the Apple iPhone; this is the Hi-Phone.

“But it’s just as good,” the clerk says.

Nearby, dozens of other vendors are selling counterfeit Nokia, Motorola and Samsung phones — as well as cheap look-alikes that make no bones about being knockoffs.

“Five years ago, there were no counterfeit phones,” says Xiong Ting, a sales manager at Triquint Semiconductor, a maker of mobile phone parts, while visiting Shenzhen. “You needed a design house. You needed software guys. You needed hardware design. But now, a company with five guys can do it. Within 100 miles of here, you can find all your suppliers.”

Technological advances have allowed hundreds of small Chinese companies, some with as few as 10 employees, to churn out what are known here as shanzhai, or black market, cellphones, often for as little as $20 apiece.

And just as Chinese companies are trying to move up the value chain of manufacturing, from producing toys and garments to making computers and electric cars, so too are counterfeiters. After years of making fake luxury bags and cheap DVDs, they are capturing market share from the world’s biggest mobile phone makers.

Although shanzhai phones have only been around a few years, they already account for more than 20 percent of sales in China, which is the world’s biggest mobile phone market, according to the research firm Gartner.

They are also being illegally exported to Russia, India, the Middle East, Europe, even the United States. “The shanzhai phone market is expanding crazily,” says Wang Jiping, a senior analyst at IDC, which tracks technology trends. “They copy Apple, Nokia, whatever they like, and they respond to the market swiftly.”

Alarmed by the rapid growth of counterfeits and no-name knockoffs, global brands are pressing the Chinese government to crack down on their proliferation, and are warning consumers about potential health hazards, like cheap batteries that can explode.

Nokia, the world’s biggest cellphone maker, says it is working with Beijing to fight counterfeiting. Motorola says much the same. Apple Inc. declined to comment.

Even Chinese mobile phone producers are losing market share to underground companies, which have a built-in cost advantage because they evade taxes, regulatory fees and safety checks.

“We’re being severely hurt by shanzhai phones,” says Chen Zhao, a sales director at Konka, a Chinese cellphone maker. “Legal cellphone makers should pay 17 percent of their revenue as value-added tax, but shanzhai makers, of course, won’t pay it.”

So far, however, China has done little to stop the proliferation of fake mobile phones, which are even advertised on late-night television infomercials with pitches like “one-fifth the price, but the same function and look,” or patriotic appeals like “Buy shanzhai to show your love of our country.”

Last month, the Ministry of Industry and Information Technology did warn consumers about the hazards of shanzhai phones, saying “their radiation usually exceeds the limit.” China’s consumer protection agency says faulty mobile phones were the No. 1 consumer complaint last year.

A few weeks ago, a 45-year-old man in south China was severely burned after his cellphone exploded in his shirt pocket, according to state-run news media.

But that hasn’t seemed to affect sales of black market phones, which typically sell at retail for $100 to $150. In the spirit of what is called “shanzhai” — which suggests rebels or bandits and which applies to counterfeit products of all kinds — many consumers are willing to take a risk on a cheap item that looks stylish.

“I saw iPhone pictures on the Web; it’s so cool. But it costs over $500 — too expensive,” says Yang Guibin, 30, an office worker from Chongqing. “So I decided to buy a shanzhai iPhone. I bought it in a digital market here; it looked exactly like the iPhone.”

Some experts say they believe the shanzhai phenomena is about being creative, Chinese style.

“Chinese grass-roots companies are actually very innovative,” says Yu Zhou, a professor at Vassar College. “It’s not so much technology as how they form supply chains and how rapidly they react to new trends.”

While the phones may look like famous brands, companies actually add special features like bigger screens, dual-mode SIM cards (which allow two phone numbers) and even a telescopic lens attachment for the phone’s camera.

Since it is the SIM card that makes a phone run in China, as in most places other than the United States, all you have to do is insert a valid SIM card into a shanzhai phone and it works.

All this innovation comes from an industry that only took off in 2005, after Mediatek, a semiconductor design company from Taiwan, helped significantly reduce the cost and complexity of producing a mobile phone.

Using what experts call a turnkey solution, Mediatek developed a circuit board that could inexpensively integrate the functions of multiple chips, offering start-ups a platform to produce a low-cost mobile phone.

The industry got another boost in 2007, when regulators said companies no longer needed a license to manufacture a cellphone.

That set off a scramble by entrepreneurs in this electronics manufacturing center. Counterfeiting and off-brand knockoffs flourished. Tiny companies would buy a Mediatek chip loaded with software, source other components and ask a factory to assemble them.

Marketing strategies were simple: steal. Designs and brand names were copied identically or simply mimicked. (Sumsung for Samsung or Nckia for Nokia.)

Tapping into the supply chains of big brands is easy, producers say. “It’s really common for factories to do a night shift for other companies,” says Zhang Haizhen, who recently ran a shanzhai company here. “No one will refuse an order if it is over 5,000 mobile phones.”

The people who make fake iPhones admit it’s a shady business.

“We are a kind of illegal producer,” says Zhang Feiyang, whose company, Yuanyang, makes an iPhone clone. “In Shenzhen there are many small mills, hidden. Basically, we can make any type of cellphone.”

The competition is already forcing global brands to lower prices, analysts say. And new Chinese brands are emerging, like Meizu, a would-be Apple that has opened stylish stores here.

“Our phone is even better than the iPhone,” says Liu Zeyu, a Meizu salesman in Shenzhen. “Our goal is to create a phone that makes Chinese proud.”

Chen Yang contributed research.

Counterfeiters turn to Cellphones

Technological advances have allowed hundreds of small Chinese companies, some with as few as 10 employees, to churn out what are known here as shanzhai, or black market, cellphones, often for as little as $35 apiece. This fake Louis Vuitto-branded phone was available at a mobile phone market in Shenzhen, China.

Lobby Mesin Voting memilih Software Voting Open Source

Matthew Burton | April 21, 2009 - 8:01pm
Companies who make proprietary products do not like open source alternatives to those products. They view open source products as a threat. Partly because they're free, but mainly because they have more potential.

So if the voting machine lobby published a report called "Open Source: Understanding its Application in the Voting Industry," (540K PDF) how much understanding do you think it would impart upon the reader? Either this document seeks to confuse, or its authors are confused themselves. The report is clearly targeted at those who make decisions regarding elections:

Legislators who adopt policies that require open source products, or offer incentives to open source providers, will likely fall victim to a perception of instituting unfair market practices.

I believe that a competitive market is usually the best way to get something done. But when it comes to securing and bug-proofing software, open source code will always be better. Incentivizing a better way is the government's job. They incentivize more efficient energy sources. Why not more transparent elections as well? (Plus, if there were one thing left alone by the marketplace, shouldn't it be a vote counter?)

The report devotes several pages to explaining how open source works. The assumption is that the reader is unfamiliar with open source, and they probably are: they are election officials, not developers or software lawyers. So the report does its best to portray open source products as leaderless and unmaintained:

It is likely that an open source project...would lack the structure to support products as they are fielded by local election officials. In addition to software support, the issue of accountability in such an open source environment remains an area for further research.

They ignore the fact that some companies' entire revenue models revolve around integrating, modifying and supporting open source software. Red Hat's market cap is twice that of Diebold's. I'm sure they can support your election.

The report also has a chart that compares the download statistics of a few open source election projects with some of the more popular file sharing programs. First, it's very dishonest to equate low usage with low quality. These numbers speak to demand, not quality. Free music is popular. Installing an electronic voting machine in your garage isn't. Even if the whole world adopted a standard open source election system, it would not be downloaded as often as a tool that lets you get free media.

Are the listed software products good? I don't know. But I do know that programmers seldom donate their time to software that people don't want. The more people clamor for something, the more time volunteers will devote to it. Because of the unique nature of election software--the average person has no use for it--the people with the power to adopt it are going to have to speak up in order for developers to commit themselves to it. If any people with such power are reading this, the ETC is trying to pull one over on you. They're trying to convince you that your own lack of demand for open source election software is the very reason you don't want it.

In any case, these download statistics make false argument. Nobody I know is saying we should abolish proprietary systems tomorrow and switch to an existing open source product. We're saying open source election software deserves attention and support, and effort to create a kick-ass system must be marshaled. When programmers donate their time, they do it for causes that they know people will benefit from. If they aren't making open source voting software, it's because the users (secretaries of state, county clerks, and the FEC) aren't asking for it. So please, do what the ETC is begging you not to do: start talking about open source voting software, and offer incentives to those who might make it.

Femtocells Pass a Standard Milstone

Posted by Carl Weinschenk Apr 13, 2009 5:06:11 PM
The finalization of a standard is important. Just ask the folks trying to work through 802.11n. In that context, the femtocell industry passed a major milestone earlier this month when a standard for Universal Mobile Telecommunications System (UMTS) femtocells was finalized.

The announcement, which was made by the Femto Forum, the 3rd Generation Partnership Project and Broadband Forum, said that the spec covers network architecture, security, management and provisioning and radio and interference aspects, according to Unstrung. Femtocell rollouts to date, the piece says, have been limited and the standard should help. It suggests, however, that improvements will occur “at a limited pace” and concludes by noting that ip.access and Ubiquisys announced compliant products and that similar announcements should be expected.

Tech Watch provides more information on the ip.access femtocell, called the Oyster 3G. Interestingly, the story doesn’t exactly say that the device is compliant with the new standard. Instead, it quotes the company as saying that an upgrade has made “significant process” toward that status. The other takeaway is a non-expert explanation of the standard’s importance. It says that it provides plug-and-play functionality and facilitates femtocells that are easy to install, scalable and cost-effective.

It’s wise to take research done by vendors that just happens to validate what they are peddling with a grain of salt. It’s also wise not to simply dismiss the findings. Results that the vendor doesn't like are more likely to be discarded than changed. Thus, it is entirely possible that those that are released are legitimate. With that as a preface, this InformationWeek piece describes research from Airvana, which offers femtocell technology under the HubBub label. The piece says the vendor ran three tests each in urban, suburban and rural settings and found that throughput exceeded 2 Megabits per second (Mbps) “on a statistically reliable basis.” Arivana and the writer of the story say the major selling point of femtocells is coverage. Thus, speed increases can be a powerful additional inducement to service providers and end users.

Will Franks, who lets us know what he thinks of his contribution to femtocells by the name of his site -- Femtocell Pioneer -- provides three data points on why femtocells are not just for the home. He says it is possible for businesses to put together what he refers to as “Lego bricks” of coverage that can be fitted into any space and expand or shift as needs change. He says that femtos' self-organizing nature eliminates the need for site surveys, or changes to the macro network, and that they are simple enough to be sold through existing direct and indirect channels.

Those who can still afford to attend trade shows invariably pick up a lot of useful information. That was true of femtocell shoppers visiting the recent CTIA show in Las Vegas. Femto Hub does a good job of rounding up the femtocell news from the show. On the Code Division Multiple Access (CDMA) side, Airvana demonstrated HubBub, AirWalk exhibited the EdgePoint Pro, Hitachi showed products developed in partnership with Airvana and Motorola won the CTIA Emerging Technology Best in Show award for its femtocell picture frame. Airvana, Tatara, Acme Packet and Starent Networks showed their products in network scenarios. On the CDMA side of the coin, Ubiquisys, Alcatel-Lucent and Airvana displayed products.

Much of what occurs for the balance of the year will depend on whether the economy improves. The good news is that the standards process seems to be moving along nicely and, perhaps more importantly, vendors seem ready to support customers who do materialize.

Microsoft Terancam Denda US$388 Juta karena Langgar Hak Paten

Microsoft terancam didenda sebesar US$388 juta karena melanggar hak paten milik perusahaan software anti pembajakan, yaitu Uniloc. Keputusan ini disampaikan oleh Federal Jury Rhode Island yang memutuskan perkara ini.

Software yang dipatent-kan itu akan menerbitkan identitas para pengguna lisensi untuk mendeteksi apakah legal atau tidak.
Diberitakan pula bahwa Microsoft akan melawan keputusan ini dengan menyatakan bahwa pihaknya tidak melanggar paten tersebut karena paten tersebut dianggapnya tidak berlaku.

Berita selengkapnya ada dibawah ini:

Posted by Lora Bentley Apr 10, 2009 2:29:05 PM

Here's an interesting patent law tidbit: Reuters reported Wednesday that a federal jury in Rhode Island entered a $388 million judgment against Microsoft for infringing patents belonging to anti-piracy software vendor Uniloc.

Microsoft, of course, will ask the judge to overturn the verdict. A spokesperson told Reuters, "We believe that we do not infringe, that the patent is invalid and that this award of damages is legally and factually unsupported."

The patent in question covers software that prevents unauthorized use of software by "generating unique identities for licensed users," the story says. The award is reportedly one of the largest on record in a patent case.

Empat Pelajaran dari Hasil Penyelesaian Kasus Pelanggaran HaKI Microsoft vs Distributor Open Source

Ada empat Pelajaran yang kita dapat dari hasil Penyelesaian Kasus Pelanggaran HaKI Microsoft vs Distributor Open Source, yaitu " Microsoft and TomTom Settle Patent Infringement Cases" dimana Perusahaan Distribusi OSS Tom Tom setuju mengambil paten berbayar dari Microsoft untuk lisensi penggunaan navigasi kendaraan, dan menghentikan penggunaan software File Allocation Table (FAT) yang di-klaim sebagai milik Microsoft, guna melindungi para pengguna produk Tom Tom. Ini menandakan bahwa konflik antar pengguna HaKI akan tetap ada selamanya, namun dapat diselesaikan melalui Pengadilan sebagaimana kasus-kasus lainnya yang biasa diselesaikan.

Adapun empat pelajaran itu adalah sebagai berikut:

1. Software Open Source bukan wilayah software HaKI gratis, karena keberadaan software Open Source adalah karena adanya HaKI GPL (General Public License).
   
2. Tuntutan Pelanggaran HaKI, termasuk atas OSS, adalah proses tuntut-menuntut biasa dan dapat diselesaikan (business as usual).
3. Tuntutan terhadap OSS memang dapat terjadi namun dapat diselesaikan seperti pada kasus Tom Tom diatas, dimana Tom Tom membayar hak paten yang dipakainya dan menghentikan penggunaan software FAT milik Microsoft.
4. Penyelesaian kasus2 tuntutan HaKI adalah baik bagi para pengguna Software itu, karena dapat menggunakan tanpa rasa ketakutan.

Rincian lengkap dari artikel " Four Takeaways from the Microsoft-TomTom Settlemen" ada terlampir dibawah ini:

by JeffSeul, Holland & Knight
Apr 8, 2009 9:28:58 AM

Whatever one thinks about open source software and software patents, the recent settlement of Microsoft's patent infringement lawsuit against TomTom illustrates that both are here to stay and that conflicts between owners of intellectual property rights (IP) at the intersection of the two can be resolved in the usual way.

To be sure, five of the eight Microsoft patents at issue in the case had nothing to do with the open source Linux operating system used in TomTom's car navigation devices. Microsoft stressed that its lawsuit was not the beginning of an assault on Linux(1), and Jim Zemlin, executive director of the Linux Foundation, characterized it as "a private dispute" and urged others not to jump to the conclusion that it was anything more(2). Nonetheless, the lawsuit – and its quick settlement – may tell us something about the ongoing evolution of the tech industry and how open source software (OSS) figures within it.

What does the Microsoft-TomTom settlement mean for tech companies and their customers? Here are four takeaways:

Takeaway 1: Open source software is not an IP-free zone.

There is a great deal of confusion among non-lawyers about the applicability of intellectual property (IP) rights to OSS. Perhaps contrary to popular opinion, the OSS model is based upon the existence of IP rights.

The most commonly used OSS license is Version 2 of the GNU General Public License, or GPLv2. As explained in the GPLv2 itself(3), it relies upon the existence of and ability to enforce copyrights, as does any software license. All licenses grant users a subset of the rights held by the software's creator, so long as users comply with the obligations and restrictions found in the license. For example, like other "copyleft" OSS licenses, the GPLv2 requires users to make any improvements (and related source code) available to the world only under the GPLv2, just as the original creator of the software chose to do. OSS also can be protected by patents, and it can infringe patents that protect other software.

The Microsoft-TomTom settlement is further evidence that sophisticated developers and distributors of OSS understand that OSS is not an IP-free zone. A settlement is not an admission of liability, of course, but TomTom's decision to settle quickly, on terms that require it to stop using some of Microsoft's Linux-related patents and shield its customers from lawsuits for infringement of other Linux-related Microsoft patents, presumably is a tacit acknowledgment that Microsoft's infringement claims need to be taken seriously.

1. See Q&A: Microsoft's IP Chief on TomTom, Linux and Patents (last visited Apr. 8, 2009).

2. See Note on MIcrosoft TomTom Suit: Calm Down, Hope for the Best, Plan for the Worst (last visited Apr. 8, 2009).

3. Paragraph 5 of the Preamble to the GPLv2 says, “We protect your rights with two steps: (1) copyright the software, and (2) offer you this license which gives you legal permission to copy, distribute and/or modify the software.” See GNU General Public License, version 2 (last visited Apr. 8, 2009).

Takeaway 2: IP lawsuits, including suits involving OSS, are just business as usual.

Traditional software companies have brought IP infringement lawsuits against one another for eons. Now, we not only see traditional software companies occasionally suing distributors of OSS, we see distributors and proponents of OSS suing others, both offensively and defensively(4).

For example, in September 2007 the Software Freedom Law Center, an organization that provides legal services to protect and advance OSS, filed an enforcement action against Monsoon Multimedia on behalf of the creators of BusyBox software, which is distributed under the GPLv2(5). The suit alleged copyright infringement for distribution of modifications to the software without making source code for the modifications available as required by the GPLv2. In Europe, guardians of OSS also are aggressively pursuing license violations as copyright infringement. A group called the gpl-violations.org project claims to have successfully enforced the GPL in over 100 cases between 2004 and 2006(6).

Patent related OSS litigation is also becoming common(7). Microsoft is not the first traditional software company to sue an OSS vendor for patent infringement, and TomTom is not the first major OSS distributor to settle a suit. In June 2006, Firestar Software sued Red Hat, a leading commercial distributor of OSS, alleging that Red Hat's open source Hibernate product infringed a patent covering Firestar's ObjectSpark technology(8). The companies have since settled the dispute.

In another recent case, Trend Micro, a developer of software that protects computers against viruses and spam, sued Barracuda Networks, a company that sells hardware containing open source anti-virus and anti-spam software, for patent infringement(9). In response, Barracuda Networks sought support from the open source community. It ultimately initiated a separate lawsuit to try to have Trend Micro's patents declared invalid(10) and another lawsuit alleging that Trend Micro was infringing three patents newly acquired by Barracuda Networks from IBM, which contributes to OSS projects and distributes OSS as part of its marketing strategy for its hardware and services offerings(11). TomTom used Barracuda Networks' defense strategy – counter-suing with patents newly acquired from a third party – in a patent infringement suit brought against it by another competitor, Garmin(12). Before the recent settlement, TomTom also sued Microsoft for patent infringement in response to Microsoft's lawsuit.

Patent infringement claims by OSS vendors aren't always defensive. Indeed, TomTom sued its Japanese navigation product rival Aisin AW last year for allegedly violating four of its patents(13). Barracuda Networks, TomTom and other OSS vendors are sophisticated companies that understand the IP environment and deploy both IP rights and OSS to their commercial advantage(14).

4. See generally Francis M. Buono and McLean Sieverding, Trend Spotting: Recognizing the Growing Risk of IP Litigation Facing OSS Developers and Implementers, METROPOLITAN CORPORATE COUNSEL, Vol. 16, No.9 (Sept. 2008).

5. Andersen et al. v. Monsoon Multimedia, Inc., No. 07-CV-8205 (S.D.N.Y. 2007) (settled). Similar suits have been brought against others. See, e.g., Andersen et al. v. Xterasys Corp., No. 07-CV-10455 (S.D.N.Y. 2007) (settled); Andersen et al. v. High-Gain Antennas, No. 07-CV-10456 (S.D.N.Y. 2007) (settled); Andersen et al. v. Verizon, No. 07-CV-11070 (S.D.N.Y. 2007) (settled).

6. GPL-Violations.org (last visited Apr. 8, 2009).

7. The following cases provide a few examples, in addition to those discussed in the body of this article: Jacobson v. Katzer, 2008-1001 (Fed. Cir. 2008); IP Innovation LLC v. Red Hat, Inc. et al., No. 07-CV-00447 (E.D. Tex. 2007); Network Appliance v. Sun Microsystems, No. 07-CV-06053 (N.D. Cal. 2007).

8. FireStar Software, Inc. v. Red Hat, Inc., et al., No. 06-CV-00258 (E.D. Tex. 2006) (settled).

9. Trend Micro initiated an action before the International Trade Commission seeking an order preventing Barracuda Networks from distributing the allegedly infringing products. Trend Micro, Inc. v. Barracuda Networks, Inc., No. 337-TA-624, 72 Fed. Reg. 74,329 (USITC, Dec. 31, 2007).

10. Barracuda Networks, Inc. v. Trend Micro, Inc., No. 07-CV-01806 (N.D. Cal. 2007).

11. See generally Ryan Paul, Barracuda bites back at Trend Micro in ClamAV patent lawsuit, ARS TECHNICA (July 2, 2008), (last visited Apr. 8, 2009).

12. See Press Release,Garmin Ltd., Garmin Obtains Complete Victory on TomTom Patents, Will Pursue Own Patent Claims Against TomTom (Dec. 23, 2006), (last visited Apr. 8, 2009).

Takeaway 3: Settlements of lawsuits involving OSS can and do occur.

All of the lawsuits mentioned above were settled. IP lawsuits, including those involving OSS, settle in one of the following ways, or some combination of them: the defendant stops using the plaintiff's IP, the defendant pays the plaintiff for a license to use it, or the parties cross-license IP to one another.

In the Microsoft-TomTom settlement, TomTom agreed to take a paid license under Microsoft's car navigation patents. While TomTom agreed to stop using the FAT LFN file system technology covered by two patents that Microsoft claims are infringed by the Linux operating system used in TomTom's navigation devices(15), TomTom will continue to use technology covered by two other patents that Microsoft claims are infringed by Linux. Microsoft agreed not to sue TomTom's customers based on their use of that technology(16).

Some people believe the GPLv2 prohibits all types of "discriminatory" settlements of patent suits, i.e., settlements that protect some licensees of GPLv2-covered software without providing the same protection to all other licensees. It does not. The GPLv2 prohibits agreements that cannot be honored while honoring the terms of the GPLv2(17), but it is possible to structure settlements and other agreements that do not induce anyone to violate the GPLv2. Microsoft has now reached several patent truces with companies that distribute software under the GPLv2, not least of which is its 2006 agreement with Novell. That agreement includes a covenant not to sue end users of products containing the infringing patents. Several leaders of the Free Software Foundation, including Richard Stallman, have publicly stated that the Novell deal is consistent with the GPLv2(18).

13. See TomTom sues Toyota navigation company, TRAFFIC TECHNOLOGY TODAY.COM (Feb. 18, 2008).

14. According to the online records of the United States Patent and Trademark Office, Dean Drako, the founder of Barracuda Networks, filed applications for two anti-spam related software patents long before Trend Micro sued Barracuda Networks: Patent Application No. 20060248575, titled "Divided encryption connections to provide network traffic security," filed on November 2, 2006; and Patent Application No. 20060238991, titled "Low profile expansion card for a system," filed on October 26, 2006. Both applications are still pending.

15. Some critics of Microsoft's suit against TomTom, like Bruce Perens, creator of the Open Source Definition, claim Microsoft’s File Allocation Table Long File Name (FAT LFN) patents are not innovative, implying, it seems, that they could be invalidated if challenged. See Bruce Perens: Analyzing Microsoft's TomTom Lawsuit (last visited Apr. 8, 2009). In fact, each patent has been affirmed twice by the U.S. Patent and Trademark Office, in the original examination and later during re-examination in 2006. U.S. Patent No. 5758352 was affirmed through reexamination on October 10, 2006, and U.S. Patent No. 5579517 was affirmed through reexamination on November 28, 2006. It also is well known that many companies have taken licenses under them. See TomTom Can License FAT Without Violating GPL (last visited Apr. 8, 2009).

16. See Microsoft and TomTom Settle Patent Infringement Cases (last visited Apr. 8, 2009).

17. GPLv2, Section 7.

18. See Transcript of Richard Stallman from the fifth international GPLv3 conference, Tokyo, Japan; 2006-11-21 (last visited Apr. 8, 2009).

Takeaway 4: Settlements are good for IT consumers, the people who matter most.

Litigation involving OSS is increasing, so it is good to see that suits involving OSS can be resolved in the usual way. Many tech companies, like TomTom (and Microsoft ), now pursue a "mixed source" strategy in which they distribute both open source software and proprietary software – often in the same product. Many OSS projects begin as labors of love, but most significant projects ultimately must find financial sponsors to survive and thrive. The Linux operating system, the Apache HTTP Server, the Firefox Web browser and other major OSS projects are supported by financial contributions and "volunteers" paid by major companies that produce revenue from products and services which are wholly or partially dependent upon the success of those projects. As Sun Microsystems explains in its 2007 10-K filing with the SEC, "[w]e build relationships with [the open source development community] to stimulate demand for our commercial products."

When software companies resolve their differences by agreement, they show respect for their customers, many of whom know and care little about the geopolitics of the tech industry, and all of whom want good products at reasonable prices that they can use without concern about debates among IP lawyers. According to Microsoft, for a year before it filed suit it tried to persuade TomTom to take a license under its patents. Given how fast the suit settled and the terms of the settlement, one wonders what changed from TomTom's perspective – except that it could no longer question whether Microsoft was serious. It seems a public skirmish could have been avoided, but the Microsoft-TomTom settlement is nonetheless another hopeful sign that the tech industry is evolving to accommodate different business models and development paradigms within the system of IP rights on which innovation for the benefit of consumers partially depends.