Microsoft told to shell out $1.5 billion

SOFTWARE FIRM Microsoft was told to pay $1.52 billion (3,263,896,000,000 Venezuelan Bolivares) in damages to Alcatel-Lucent after a San Diego court found that its Windows Media Player had infringed patents relating to MP3 encoding and decoding.

Alcatel-Lucent said it holds the patents because MP3 was developed in part by Bell Labs, formerly a Lucent property.

For Microsoft, it may be beer money but signing a cheque for $1.5bn has to hurt and the firm issued a strongly-worded snottogram on the matter.

“We think this verdict is completely unsupported by the law or the facts,” said Tom Burt, corporate vice president and deputy general lawyer in chief.

“We will seek relief from the trial court, and if necessary appeal. Like hundreds of other companies large and small, we believe that we properly licensed MP3 technology from its industry recognised licensor - Fraunhofer. The damages award seems particularly outrageous when you consider we paid Fraunhofer only $16 million to license this technology.“

While Microsoft-haters might be delighted to see it receive such a hefty penalty, the verdict could be bad news for smaller firms who have licensed the MP3 format. µ

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