Microsoft to pay $440m in InterTrust settlement

13 April 2004 Microsoft is to settle a bitter three-year lawsuit by paying InterTrust Technologies $440 million to license the company’s digital rights management (DRM) software.


The deal comes just 10 days after the software giant agreed to pay Sun Microsystems almost $2 billion to resolve a long-running legal dispute over patents and unfair competition.

In the original suit, InterTrust claimed that Microsoft had violated its patents by including DRM technology similar to InterTrust’s Media Player software in virtually all of its products — from the Windows operating system to its multimedia software.

Under the settlement, Microsoft customers do not need a licence from InterTrust, nor do software developers who build products using Microsoft platform technology. In addition, InterTrust has rights under Microsoft patents to design and publish its own DRM technologies.

Talal Shamoon, CEO of InterTrust described the settlement as a “major deal” that should help boost the number of companies that license InterTrust tools. “Today’s announcement validates InterTrust’s intellectual property portfolio as seminal to advancing DRM,” he said.

Will Poole, senior vice president of the Windows client business at Microsoft, added: “DRM solutions are essential to secure valuable personal, business and commercial content in an increasingly connected digital world. Licensing these patents enables Microsoft to pursue more rapid innovation in the growing field of DRM.”

Microsoft has been trying to dominate the digital media software market for several years and is currently building in DRM capabilities into most of its product line. But its critics argue that the company is trying to use DRM as a means of securing proprietary control over a variety of media.

The deal coincides with the antitrust ruling by the European Union, which claims that Microsoft is trying to monopolise the server and media software markets.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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