Friday, August 11, 2006

IP Professor Attacks Philips' Right To Collect Royalties For DVDs

Zhang Ping, a professor from the Intellectual Property Rights Institute of Peking University, has filed an argument against Philips, a member of the 3C DVD Patent Group.

The 3C DVD Patent Group consists of Philips, Sony, Pioneer (that's 3), but LG Electronics joined them, so in fact it is now 4C DVD Patent Group, read here.

According to China Tech News Professor Zhang has been working on a case against Philips' DVD patent since september last year, accumulating evidence. If Zhang's validity report on the Philips' DVD patent and "the rationality of their patent fee in China passes the review of the State Intellectual Property Office, Philips and other 4C members will no longer have the right to charge a DVD patent fee from Chinese enterprises."

It's expensive not to own technology standards. Edward Jung of Intellectual Ventures quoted China’s Minister of Science and Technology Xu Guanhua saying:

"Since 99 percent of Chinese companies fail to file for patents, royalties are a high burden, including a 20 percent royalty stack on mobile phones, 30 percent on computers, and 40 percent on programmed numerical control machine tools paid to overseas patent holders. A Chinese exporter of a $32 DVD player exporter makes one dollar in profit and pays $20 to patent holders outside China." Read more of Edward Jung's testimony to the US-China Economic and Security Review Commission about China's Intellectual Property Right enforcement here.

"A final judgment will be made next Thursday. Philips may have to return the patent fees it has already collected from Chinese enterprises if it loses the judgment."

Read the China Tech News article here.

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