Lodsys Responds to Uproar Over Patent Infringement Notices

Lodsys has posted a Q&A to address the uproar over recent patent infringement notices sent to iOS developers. The company notes that Apple, Google, and Microsoft have already licensed their technology; however, their licensing doesn't transfer to third party developers.

The scope of their current licenses does NOT enable them to provide "pixie dust" to bless another (3rd party) business applications.   The value of the customer relationship is between the Application vendor of record and the paying customer, the OS (is acting as an enabler) and the retailers (are acting as a conduit to connect that value), and taking their % for that middleman role.  

Many complain that Lodsys should not have been award the patent on something so general as in-app upgrade. To this they respond saying:


The patents were issued and recognized as invention from a patent application filed in August of 1992. It is all too easy to look back with 18.5 years of hindsight, and knowledge of how the market has evolved, and say "of course this is how everyone is going to do it" or "the patents are too broad."

Lodsys says the notices it sent out were not cease and desist letters but notice letters informing companies of usage and requesting to engage in a licensing discussion.

In the case of an Application doing an in-application upgrade (and only this scenario), Lodsys is seeking 0.575% of US revenue over for the period of the notice letter to the expiration of the patent, plus applicable past usage. So on an application that sells US$1m worth of sales in a year, the licensee would have an economic exposure of $5,750 per year.

While the strength of Lodsys patent portfolio is unknown to us, the fact that Apple, Google, and Microsoft have licensed their patents means this may be a difficult battle for iOS developers. Hopefully, Apple will step in and address the situation.


Read More [via Ronny]