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Thursday, 11 November 2010 09:21

Microsoft files suit over Xbox royalties

Written by David Stellmack
xbox360

Says Motorola rates unreasonable
Microsoft has filed suit against licensing partner Motorola for what it called “excessive and discriminatory” royalties that it is charging the company for technology patents used in the Xbox 360, as well as smartphones and Windows products.

The suit suggests that Motorola breached its contracts with Wi-Fi and video codec standards groups. Apparently, the majority of the patent licensing royalties at issue center on the 802.11 and H.264 standards. The suit claims that Motorola violated its own letters of assurance to the IEEE-SA, which oversees the specifications.

Microsoft claims that they are willing to pay reasonable and non-discriminatory royalties to Motorola, but also contend that the Motorola patents are not essential to the primary functionality of the Xbox 360, for example. Motorola claims that royalties are based on the retail cost at which products are sold. Microsoft claims that Motorola’s patents are a fraction of the overall cost of the products.

The suit comes after Microsoft also filed suit against Motorola last month, where it claimed that the company violated its patents in the Motorola line of Android smartphone products. We will have to watch this closely, as it could be one to watch as it winds its way through the courts.

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