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Sharing Secrets

Tech vendors face a dilemma: protect their intellectual property, yet share it enough to keep the market growing. Microsoft is tackling that challenge with a strategy that lets startups license its software with equity rather than cash. Atheros, a wireless chipmaker, is making its configuration software available via open source, hoping to spur the home and small-office market. Intermec, which holds patents on many technologies important to making RFID hardware, is proposing licensing its techno
Microsoft Looks To Startups

Two years into a revitalized intellectual-property strategy, Microsoft is looking to license its software to startups--a different approach from its focus on other large vendors. The new Microsoft Intellectual Property Ventures offers Microsoft software to entrepreneurs in exchange for a financial stake in their companies.


David Harnett

David Harnett
Microsoft has invested in startups before, but this is this first time it has tried the technology-for-equity model, says David Harnett, senior director of Microsoft IP Ventures. "To play in this market, you have to be more flexible," he says.

Microsoft IP Ventures didn't disclose licensing terms; those will be reached on a case-by-case basis. Microsoft doesn't expect to take more than a 50% ownership in any of its partners, but it wants something more than mere 1% or 2% stakes, company officials say.

The program starts with a menu of 20 Microsoft-developed technologies available for licensing, ranging from facial-sketching software to data-visualization tools.

Last month, Microsoft struck a deal with Inrix Inc., a startup that serves as an early example of how Microsoft IP Ventures plans to work with small companies. Formed by two former Microsoft employees, Inrix is developing real-time traffic-information services. It's licensing Microsoft's SmartPhlow visualization software for mobile devices, JamBayes statistical-analysis engine, and ZoneZoom map-navigation software.

--John Foley


Wireless Security Opens Up

Open-source programming first made its mark in operating systems and infrastructure applications, and later extended to database, reporting, and other types of business software. Now wireless-security-configuration software has entered the fray with Atheros Communications Inc.'s JumpStart Developer's Kit.

JumpStart, originally released in January as a proprietary product, is designed to let wireless laptop PCs, cell phones, cameras, printers, and MP3 players running Windows establish a secure session with any access point that supports Atheros technology. So far, these access points have been made predominantly by D-Link Systems Inc. and Corega Holdings KK in Japan.

Atheros' motive for making JumpStart's source code available is to expand the home and small-business wireless market by making security configuration easier. "Open source allows JumpStart to be included into products that we don't control," says Kevin Hayes, distinguished engineer and JumpStart's principal architect.

Atheros last week set up JumpStart as an open-source project on SourceForge.net and posted its source code. It's licensing the open-source project via Sun Microsystems' Industry Standards Source License, which requires that significant changes to source code be contributed back to the open-source project.

--Larry Greenemeier


RFID Patents Get Grouped

Intermec Technologies Inc. is simplifying licensing agreements for its more than 145 radio-frequency identification patents. Using a limited-time-offer approach, between June 1 and Aug. 31 Intermec will sell groups of its patents through four "portfolio families" to makers of RFID tags, readers, and printers. Intermec previously sold each patent individually. The new approach includes a membership fee and royalties of 2.5% to 7.5%. Specific prices weren't disclosed.

While it has been possible for vendors to design and manufacture previous generations of RFID tags without infringing on Intermec's intellectual property, that might be more difficult with the Gen 2 RFID tags. Intermec owns patents for data encryption and increased read capabilities, which are unique capabilities of the Gen 2 tags.

Gen 2 tags eventually will replace Class-0 and Class-1 protocols. Retailers that have deployed RFID, such as Wal-Mart Stores Inc. and Metro Group AG, have begun testing the Gen 2 technology.

--Laurie Sullivan