Microsoft Facing Ban On US Xbox 360 Sales
The Xbox 360 era may becoming to an ignoble end, if the recommendation of the presiding judge in the International Trade Commission dispute between Microsoft and Motorla is followed.
At issue is Motorola’s claim that the 4GB and 250GB versions of Xbox 360 Slim infringe on Motorola patents because they use “Motorola-developed technology that allows set-top boxes to decode transmissions between its Droid2 and DroidX mobile devices”. Motorola filed a complaint with the ITC in 2010; in April, 2012, Presiding Judge David Shaw ruled that Microsoft had indeed infringed. Yesterday, he recommended that the International Trade Commission should ban all imports of both the 4GB and 250GB versions of Xbox 360 slim. This ban, he says, should be enforced with a cease and desist order from the ITC, and in addition, Microsoft should be forced to post a bond equivalent to 7% of the total value of all relevant models already in the US directly to Motorola.
Microsoft has insisted all along that their use of the technology was legitimate because Motorola refused to “abide by requirements set by the Institute of Electrical and Electronics Engineers Standards Association to set reasonable license fees of essential technology.” They claim further that removing these Xbox 360 models from stores would be bad for consumers because it would limit choice to PS3 and Wii. Unfortunately for Microsoft, Judge Shaw isn’t having it. He rejected this argument out of hand, ruling that enforcing intellectual property rights has greater public interest than the economic impact caused by the sudden cessation of an entire wing of the video game industry.
Judge Shaw also said that “Microsoft did not even try to show that its competitors were incapable of meeting demand for the consoles,” but we’re too busy being extremely disturbed by the supposition that IP rights supersede all other concerns to notice.
It’s important to note that this recommendation is just that, a recommendation. It is not binding, and the ITC may impose whatever punishment they want. However, as a federal agency, the ITC has the power to inflict lasting punishment, and should they agree with Judge Shaw, Microsoft’s only recourse will be a court – and ultimately, a Supreme Court – challenge. I wouldn’t hold my breath if I were Microsoft’s legal team. The SCOTUS just effectively gave their approval to forcing a young man to pay a whopping $675,000 to the RIAA for the nefarious crime of having downloaded 30 songs when he was in college. They’re probably going to come down firmly on the side of IP ownership.
If the ban is ultimately upheld, it would effectively knock Microsoft out of the console game for at least a year, possibly longer. The company has opted not to unveil their next gen console, code-named Durango, in 2012, suggesting that they have a long way to go before a workable model will be ready, even if the rumors that a dev kit version is already on the way turn out to be true. Perhaps this ruling results in Durango being rushed out; no doubt Nintendo is probably crossing their fingers that they’ll have company when WiiU flops later this year.
I admit, considering how Microsoft (through the ESA) famously acted in the shadiest possible manner when they were attempting to send Matthew Crippen to prison forevs for having modded an Xbox 360 console, it’s extremely delicious to see them being brutally hoisted by their own petard. But while the schadenfreude is indeed exhilarating, the further entrenchment of the idea that we are but feudal tenants at the mercy of entities who benefit from increasingly restrictive intellectual property laws is terrifying.