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Microsoft Rejects Motorola Settlement; Xbox Closer to Doom

CVG reports that Microsoft has rejected a settlement offer from Motorola Mobility that would finally end an extraordinarily expensive patent dispute. Motorola Mobility, now owned by Google, asked for a royalty of 2.25-percent on each Xbox 360 Slim sale, and $0.50 per copy of Windows, both of which use its patented ActiveSync technology.

Back in April, Judge David Shaw said that Microsoft should be handed a cease-and-desist order on sales of the Xbox 360 Slim console here in the United States unless the dispute was settled. He also said that the International Trade Commission (ITC) should ban Microsoft from importing the popular console from China. Microsoft should also cough up 7-percent of the value of any unsold Xbox 360 Slim systems still remaining on US-based retail shelves.

The legal drama between Microsoft and Motorola Mobility has spanned across courtrooms located in Germany and the US, and within the ITC panel itself. Microsoft claims that Motorola Mobility has breached the licensing contract by demanding "unreasonable licensing fees" for the use of the patents, requiring the company to spend around $4 billion USD each year to cover the licensing costs. Motorola claims that Microsoft gave up its right to negotiate on the royalty rate as soon as it began lawsuit action.

But now that Microsoft has rejected Motorola's offer, it's up to the ITC to allow the initial Xbox 360 Slim ban determination to stand, if it needs to amend specific terms, or send it back for a rewrite. Surprisingly, Activision and iPhone maker Apple are currently opposing a possible US market ban of the Xbox 360 Slim by the ITC.

Microsoft has already warned the ITC that banning the Xbox 360 Slim console would not serve the "public interest" (aka bad for the economy), as it would leave a gaping hole in the console sector, forcing consumer to choose between Sony's PlayStation 3 and Nintendo's Wii. Judge Shaw disagrees, saying that intellectual property rights takes precedence over consumer need.

Microsoft is also currently facing a Xbox 360 Slim ban in Germany thanks to a ruling made by a German court back in May. This verdict will not come into effect until the US-based lawsuit concludes.

  • bustapr
    though I believeMicrosoft should pay up because they ARE guilty. even they know they are guilty. But Motorola and Google should definitely lower down the licencing fees, they are asking for way too much.
    Reply
  • erick81
    Why is it surprising Activision sells more games on the 360 than any other platform and Google's gun sights would be squarely aimed at Apple on the next patent war and they have done enough trolling of their own to have everyone ready to jump on them.
    Reply
  • They are just trying to drag it out until the next xbox comes out then they won't have to worry about it.
    Reply
  • bustapr
    also cannot wrap my head around why Apples opinion is relevant in this situation.
    Reply
  • chronium
    bustapralso cannot wrap my head around why Apples opinion is relevant in this situation.
    Probably because they use the same software for syncing on there devices.
    Reply
  • AndrewMD
    First of all, Microsoft owns the ActiveSync technology, this is something they designed back the with old PDA days against Palm. How is it that this became a Motorola patent?

    I would like to see more information about the patents in question since this article does not source any.
    Reply
  • jerm1027
    Bad for the economy? If anything, it would do good, as it would pave the way for OpenGL API's. The XBox 360 is the ONLY gaming console that doesn't support OpenGL, forcing all cross-platform games to use DX. Also, backporting games would be a hell of a lot easier since OpenGL doesn't break compatibility (unlike DirectX), so this break may be a good thing for game devs.
    Reply
  • captaincharisma
    it will be doomed f the next xbox turns out to have shoddy hardware like the 360 did
    Reply
  • ubercake
    If they do ban the 360, there's no matter of choosing between the PS3 and the Wii. The PS3 will be handed all the sales. You either want next gen or you settle for kid games on the Wii. Most of the games you play on the Wii are now available on your smart phone.
    Reply
  • H.264 video decoding is what it's all about i believe.
    Reply