Wednesday, March 28, 2007

HP goes after Acer; Tri-Vision bulks up

HP alleges that Acer, its Taiwanese competitor, knowingly violated HP patents, which are directed to optical drives, clock frequency switching and power consumption. HP is seeking a jury trial and compensation for the use of its technology in Acer PC products, as well as treble damages for willful infringement of the patents and the payment of all its legal fees.

ComputerWorld says: The lawsuit may be an attempt to slow Acer's breakneck growth and its expansion in the US, according to Henry King, an analyst for Goldman Sachs (Asia) in Taipei. King also said that Acer was probably protected in the patent dispute by cross-licenses held by the companies that contract manufacture PC products on its behalf. Most major PC companies, including HP, Acer and Dell, farm out production to the same contract manufacturers in Taiwan and China, and the contract manufacturers try to sort out patent issues through cross-licenses.

The WashingtonPost quoted King in the following way: "Acer has become a threat that leading PC vendors cannot afford to neglect," he said in a research note. "We understand why competitors would desire a halt to Acer's expansion in the U.S. market." The Post also noted: HP may have taken the step to counter Acer's growing threat on the global stage, with the lawsuit aimed at slowing down its momentum in North America, which now takes up 20 percent of its sales, said JP Morgan analyst Alvin Kwock. "This is a sign that they are recognizing Acer's threat, but it should not affect Acer's financials," said Kwock.

IPBiz notes that neither article mentioned the Coalition for Patent Fairness.

Separately -->

In talking about the need to play "legal hardball," a Canadian article talking about a merger between Tri-Vison and Wi-LAN noted:

The V-chip, invented by Tri-Vision chairman Tim Collings, is the only solution to the parental controls mandated by the U.S. Federal Communications Commission, Wi-LAN chief executive Jim Skippen told an investor conference call.

The FCC is requiring that content-screening technology be included in all televisions, video recorders and other broadcast reception devices sold in the United States. But so far Tri-Vision has signed up just 42 U.S. licensees — 30 per cent of the potential market — each paying about $1 per device.

Others, including giants like Sony and Samsung, are brushing off Tri-Vision because its small size makes it difficult to enforce its patent rights, Skippen said.

"It would be very hard for them to justify paying $100 million to a company with a market cap of less than that and with only $6 million in the bank, given how expensive U.S. litigation is," he said.

"Wi-LAN . . . is a completely different kind of threat."


Blogger Unknown said...

This is great for Wi-Lan shareholders. They will be announcing several of their own licencing deals in the near term and now they can help put the pressure on for V-chip deals. Sweeeeet!

6:57 AM  

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