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Technology Law and Policy Newsletter
for members of the Colorado Bar Association Technology Law and Policy Section
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This is the February 11, 2005 Newsletter of the Colorado Bar Association’s Technology Law and Policy Section.
January 2005 was a busy month for practitioners of technology law.
Michael Powell Resigned as Chief at FCC
Powell headed the FCC since January 2001 and aggressively promoted deregulation, particularly with respect to the Internet. Powell will step down in March. His legacy includes:
1. Comprehensive rules relating to voice over Internet Protocol (VoIP), freeing that technology from extensive federal regulation;
2. Rulings that VoIP may not be regulated by states;
3. Internet services that are free from complex regulations and taxes, including a ruling that cable-modem Internet access is an "information service" rather than cable or telecommunications service, allowing cable Internet providers to circumvent rules that require DSL and other providers to give access to competitors;
4. Rules requiring the utilization of a digital rights management "broadcast flag" on all products capable of streaming or receiving digital television;
5. Broad consolidation in media ownership; and
6. Increased enforcement of media broadcast indecency rules.
Developments in Open Source Code Software
IBM Publishes Open License: On January 12, 2005, IBM published an open license to use 500 of its software patents in connection with “Open Source Software”, a term it very broadly defines.
The grant can be found at:
http://www.ibm.com/ibm/licensing/patents/pledgedpatents.pdf
The “patent defense” provisions in this grant revoke the license only if someone institutes patent infringement litigation accusing “open source software” of being infringing. This is far more lenient than are the patent defense provisions in the Common Public License, authored by IBM, which provides, in relevant part:
“If Recipient institutes patent litigation against a Contributor with respect to a patent applicable to software (including a cross-claim or counterclaim in a lawsuit), then any patent licenses granted by that Contributor to such Recipient under this Agreement shall terminate as of the date such litigation is filed. In addition, if Recipient institutes patent litigation against any entity (including a cross-claim or counterclaim in a lawsuit) alleging that the Program itself (excluding combinations of the Program with other software or hardware) infringes such Recipient's patent(s), then such Recipient's rights granted under Section 2(b) shall terminate as of the date such litigation is filed.”
IBM Suffers Open Source Litigation Setback: In the case of SCO Group , Inc. v. International Business Machines Corporation, Civil No. 2:03CV-0294 DAK (D. Utah), Judge Dale Kimball ruled in favor of SCO's motion to compel discovery against IBM. The ruling ordered IBM to turn over more of its Linux operating system-related program codes. SCO, owner of the Unix operating system, sued IBM in 2002 alleging that software appications developed by IBM using the open source Linux operating system incorporated parts of the Unix operating system. SCO is claiming $5 billion to $50 billion in damages.
Activists in South America Call for Open Source Software: On January 29, 2005 at the World Social Forum in xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />xml:namespace prefix = st1 />xml:namespace prefix = st1 />xml:namespace prefix = st1 />xml:namespace prefix = st1 />Brazil, activists urged developing nations to adopt and distribute free open-source software. The activists, including members of the Electronic Frontier Foundation (www.eff.org), claim that poor nations can't solve their problems unless they stop paying expensive software licensing fees. China, France, Germany, Japan and South Korea also are pursuing open-source alternatives. In a partial response to the open-source threat and to piracy, Microsoft last year launched stripped-down, cheap versions of Windows in Indonesia, Malaysia and Thailand, and similar products are on the way for India and Russia.
Renewed Growth in Technology Investment
On January 20, 2005 Ernst & Young/Venture One reported that $11.3 billion was invested by venture capitalists in technology companies in 2004, a 9% increase over 2003. It was the first increase in venture investment in technology companies in three years. Electronics and information services saw the largest investment improvement, taking almost 15% of the invested money. Software remained the largest venture investment category with an investment of $4.9 billion, an increase of 19.5% over 2003. Venture One predicted additional VC investment increases in 2005, reporting that VC firms are expected to have raised a total of $16.5 billion in 2004, approximately double the $8.7 billion raised in 2003.
This newsletter is available for viewing at any time on the CBA website. We are seeking contributions from CBA members for articles, news updates, practice tips, legal analyses and other comments. If you have something that you believe may be valuable or interesting to the section members, please call Brad Hamilton at (720) 635-5655 or send an e-mail message to bhamilton@bhamiltonlaw.com. Thanks to Bennett Sigmond of Jones & Keller for his contribution to this month's Newsletter.
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