Sony and Ampex settle digital camera dispute

In return for withdrawal of complaints before the ITC and D. Del., Sony will license Ampex-patented technology for making digital videotape recorders and digital still cameras. Sony will pay $40 million for the period through April 2006. After that, royalties will be based on sales. Sony will pay the fees starting with the fourth quarter of its fiscal 2004.

Recall that way back in the 1950's, Sony and Ampex cut a deal over videotape technology. Contrary to reports by Mark Lemley (for example in the University of Chicago Law Review), both parties understood the commercial potential of home videotape recording, but a business decision placed that market with Sony. Neither party failed to foresee the potential.