ARCane MP3 Patent should be worth ZIP!

I'm sure you all have read the news that French company Alcatel-Lucent is suing the techno giants of the world over the MP3 format, beginning with Microsoft, who this week was ordered to pay $1.52 billion in damages. I don't have any problem with companies going to court to protect the patents on the technology they have created, but I have problems with them allowing others to claim ownership and even accept licensing payments for years and only then say, "Ha, not so fast, you paid the wrong guy."

There is something extortion-like about going after people who have attempted to legally pay for a technology of which, until now, you didn't claim ownership. It seems plain dishonest to me. As Microsoft argued:

Microsoft disputed that Paris-based Alcatel-Lucent's patents govern its MP3 encoding and decoding tools, and said it licenses the MP3 software used by its Windows Media Player from Fraunhofer-Gesellschaft, a German company.

"We believe that we properly licensed MP3 technology from its industry recognized licenser — Fraunhofer. The damages award seems particularly outrageous when you consider we paid Fraunhofer only $16 million to license this technology," Burt said

I don't know if there will be a backlash, but a new music compression format may need to be developed. This reminds me of the early days of PC file compression and of how ARC begat ZIP.

If you were using a personal computer in the mid-1980s you probably bought a lot of software on those wonderful 5 1/4 in. floppy disks. These disks held little data and to get more software on a diskette, files were compressed using a format called ARC. ARC was a product of a company called System Enhancement Associates (SEA) and they let ARC be used for free. A few years after ARC took off, a programmer named Phil Katz developed a faster version of ARC, which Katz called PKARC.

System Enhancement Associates sued Katz for trademark and copyright infringement and won. All SEA wanted was for Katz to take PKARC off the market and to pay for their legal fees. Katz paid SEA $62,000 and took PKARC off the market. A month later Katz came out with a new compression program called PKZIP and a month or so after that ARC all but disappeared.

The early computer adopters believed strongly in shareware and despised large companies ganging up on the little guy. The lawsuit by SEA angered many shareware users, who perceived that SEA was a 'large, faceless corporation' and Katz was 'the little guy'. In fact, both SEA and PKWARE were small home-based companies, but the community largely sided with Katz and the superior compression capabilities of PKZIP.

What I remember is how fast the change came. One week everything was in ARC format, the next it was all ZIP. We need an MPZIP format to take on MP3 and send a strong message to Lucent.

On a side note, I met Phil Katz only once at a COMDEX (COMputer Dealer EXpo) in Las Vegas at the PKWARE booth. He was a very short, balding Jewish man who was surrounded by two very large bodyguards. I don't know what he was afraid of, but considering how he died it might have been himself.

Phillip W. Katz died in 2000 at the age of 37 due to complications from chronic alcoholism. Katz was found dead in a motel room holding an empty bottle of peppermint schnapps. Five other empty liquor bottles were also found in the room.