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January 30, 2006

Microsoft Office Update

Last July, Guatemalan native Carlos Armando Amado nailed Microsoft $8.9 million for infringing 5,537,590, inter-application linking technology which Microsoft had incorporated into its ubiquitous Office suite. At the time of the ruling, Microsoft crooned that "we do not believe today's verdict will have any impact on our customers." Today, Microsoft is singing a different tune.

Microsoft has emailed Office customers through its sales channel: "It was recently decided in a court of law that certain portions of code found in Microsoft Office Professional Edition 2003, Microsoft Office Access 2003, Microsoft Office XP Professional and Microsoft Access 2002 infringe a third-party patent. As a result, Microsoft must make available a revised version of these products with the allegedly infringing code replaced."

Office 2003 Service Pack 2, released last September, has a patch replacing the "allegedly infringing code". While Microsoft always encourages updates, existing customers may infringe away at their leisure without fearing a visit from the Amado Patent Prize Patrol. Microsoft indemnifies its customers from third-party patent infringement damages, but its licensing terms specify that customers "immediately" move away from infringing products when a new version becomes available. Feeling caught between cross-hairs, large corporate customers get the vapors with updates, so the concept of immediately updating is anathema, but so is the fear and doubt of losing indemnification from retarded response.

Microsoft is preparing a new version of Office (12), offering itself a new revenue stream, as well new opportunities to enterprising patentees like Mr. Amado.

Posted by Patent Hawk at January 30, 2006 2:45 PM | Patents In Business