“In settling with InterTrust Technologies Corp., Microsoft Corp. could be gaining a big advantage in the growing market for distributing music and videos online — to the detriment of competitors who now risk getting caught in InterTrust patent squabbles of their own,” Allison Linn reports for The Associated Press. “Microsoft announced Monday it would pay $440 million to InterTrust to settle a 3-year-old patent infringement lawsuit over technology for protecting music, movies and other digital content against piracy.”
Linn reports, “The settlement with InterTrust, which is jointly owned by Sony Corp., Philips Electronics NV and the investment banking company Stephens Inc., grants Microsoft a license to the Santa Clara, Calif. company’s patents in copy-protection technology, or digital rights management. The settlement should clear up concerns that big media companies including The Walt Disney Co. have had about using Microsoft technology, said Microsoft senior vice president Will Poole.”
“At the same time, the settlement could hurt Microsoft competitors who lack agreements with InterTrust, said analyst Phil Leigh of Inside Digital Media. Microsoft is battling companies including RealNetworks and Apple Computer Inc. for dominance of the digital media market,” Linn reports. “The open-ended struggle is over becoming the format of choice for everything from music downloads to video on demand. ‘If I’m a potential customer for Microsoft or Real or Apple, the advantage of this is given to Microsoft (because) I know that if I use Microsoft technology, I don’t have to worry about InterTrust,’ Leigh said. InterTrust indicated Monday that the settlement would embolden it to take a closer look at other companies that offer digital rights management.”
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