[opendtv] Re: DTV licensing; Was: Mobile DTV test
- From: Tom Barry <trbarry@xxxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Sun, 11 Apr 2004 15:47:38 -0400
Software these days can be both patented and copyrighted. But here is
an interesting idea. Consider that open source software that
officially distributes only source code has a very hard time being
patent enforced. Once the source is readily available it just sort of
leaks all over. One popular MPEG-4 codec is like this.
Now consider there is currently very little difference between
dedicated hardware and chips like FPGA's that can load software and
become many different things. If open source software starts to move
significantly towards micro-code and FPGA's or other programmable
chips this may change the economics somewhat of chip building and IP
licensing for those chips.
I think the Software Radio project is one step in that direction. It
would be possible to sell general purpose computers with lot's of
general purpose FPGA's and the like without violating too many IP
claims.
Then the users could download whatever legally questionable and
supposedly encumbered software was needed from the usual places. The
burden would be on the IP holders to go after end users, which is not
really an economically desirable thing to do. It would be very
equivalent to the RIAA's efforts at copyright protection but applying
to patents instead.
The above comments may invoke threatening growls from some list
members. And yet I believe our current legal and political directions
are indeed driving towards this outcome.
I would not at all be surprised to see some court case in the next few
years claiming that all general purpose computers are guilty of
contributory infringement. This will give more fuel to the idiots
that want legislation like the CBDTPA making all computers secure from
their own users.
It is interesting that the USA has increasingly placed its store of
capital into IP, an abstract form of property that can be so easily
duplicated that it has no real significant cost of reproduction. This
is a house of cards that probably cannot continue to be effectively
supported by special interest legislation.
Is there an IP bubble?
- Tom
Allen Le Roy Limberg wrote:
> The IP is more likely to be licensed at to the set manufacturer, rather than
> at IC foundry. The unlicensed sets fill up warehouses faster than ICs.
>
> Also, it is easier to justify $25 royalties on something that costs hundreds
> of dollars, rather than a few dollars.
>
> But IP prices being higher than actual production costs is not so strange.
> Look at PC software.
>
> What is really strange is that copyright term on stuff like computer
> software is so much longer than patent term.
>
> What is also interesting is that the Zenith royalties flow to Korea, rather
> than to the U.S. This may help to counteract just a little the huge flow of
> patent royalties from Korea to Japan.
>
> I expect to see the U.S. lose position in the innovation game as well as in
> the manufacturing game.
>
> Al Limberg
> ----- Original Message -----
> From: "Eory Frank-p22212" <Frank.Eory@xxxxxxxxxxxx>
> To: <opendtv@xxxxxxxxxxxxx>
> Sent: Saturday, April 10, 2004 5:07 PM
> Subject: [opendtv] Re: Mobile DTV test
>
>
>
>>Oops. Sent the last one without typing my reply.
>>
>>Yes, IP licensing costs are becoming an increasing percentage of chip
>
> costs with each new level of integration. One solution is to make the
> license a percentage of the ASP (average selling price), rather than a fixed
> dollar amount -- if the IP owners can agree to that. I forget the exact
> figure, but at one time the MPEG2 royalty for DVD chips was a fixed dollar
> amount which would be ludicrous today, considering you can buy an
> DVD-player-on-a-chip -- everything but the drive mechanism itself, for
> something in the neighborhood of $10-$15 -- probably less, depending on who
> you are and what your volumes are. Suppse the IP royalty was $3/unit. 25-30%
> of the ASP to the IP owners of "the standard," while the chipmaker who
> invests millions to produce and support the chip (and adds value with his
> own IP) gets margins in the single digit percentages? That business model
> doesn't fly. That lead to things like we see in China, where they are
> developing thier own standards and their own I!
>
>> P, for the simple reason that the cost of licensing the "standard" IP is
>
> too prohibitive.
>
>>Now fast forward a few years into the future, when virtually every TV set
>
> sold in the U.S. contains an ATSC receiver/decoder, MPEG2 video decoder,
> Dolby audio decoder, NTSC decoder, graphics engine, microprocessor, video
> scaling engine, etc. Now imagine that today's $200 TV sets will sell for
> $250 at retail (in equivalent 2004 dollars). The WILL sell for that small a
> premium, or they won't sell at all. Now back out the retail markup, the TV
> mfr markup and the chipmaker's markup. What do you think those chips will be
> selling for in 2007? My guess is around $10. How much of that $10 can
> possibly (without incurring a loss) be given to the large pool of IP owners?
> A few pennies to each of them?
>
>>I remember reading once that Zenith/LGE was hoping to get $5/unit for the
>
> 8-VSB patents. How much will that royalty really turn out to be when 8-VSB
> is a small fraction of the chip area on a $10 chip?
>
>>Tom brings up a valid point -- if the licensing cost of a particular IP
>
> block is too prohibitive, it will not be integrated. I would add the
> following corollary: whatever is not integrated will not be included in the
> product, except for those things that cannot be integrated for technical
> reasons (like maybe RF tuners). Regardless of mandates, etc., the end
> product will be made affordable. If there are one or two IP blocks that
> drive the cost through the roof, they will either find a niche market or
> they will disappear entirely.
>
>>-- Frank
>>-----Original Message-----
>>From: Eory Frank-p22212
>>Sent: Saturday, April 10, 2004 1:34 PM
>>To: 'opendtv@xxxxxxxxxxxxx'
>>Subject: RE: [opendtv] Re: Mobile DTV test
>>
>>
>>
>>
>>[opendtv] Re: Mobile DTV test
>>
>>* From: Tom Barry <trbarry@xxxxxxxxxxx>
>>
>>* To: opendtv@xxxxxxxxxxxxx
>>
>>* Date: Sat, 10 Apr 2004 07:24:43 -0400
>>
>>Eory Frank-p22212 wrote:
>>
>> > I wonder if there will be a market for standalone demod/FEC chips
>>
>>in 2005? There are guys out there who already have DTV-on-a-chip today
>>
>>-- demod/FEC, MPEG2 video, NTSC video & audio, Dolby audio, graphics,
>>
>>microprocessor, etc. I don't know what they cost, but clearly the
>>
>>value of each IP block is dropping fast as the integration level
>>
>>increases.
>>
>>
>>
>>Interesting point. But the incremental cost to add something to a
>>
>>chip is also determined by the IP licensing cost. If that is
>>
>>significant then it is less likely a function will be integrated along
>>
>>with big collections of possibly useful stuff. I'm not sure how that
>>
>>stacks up here.
>>
>>
>>
>>- Tom
>>
>>
>>
>>
>>
>>
>>
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