Tussle over iPod patent between Apple and Microsoft may resolve itself

Apple Computer lost out to Microsoft in its attempt to patent technology relating to its top-selling iPod music players, but many believe Apple’s miscue will ultimately result in embarassment rather than monetary loss.

Microsoft developer John Platt filed a patent application five months before Apple, according to U.S. Patent and Trademark Office documents. Apple’s application, filed by CEO Steve Jobs and other officials in October 2002, was turned down by patent officials in July.

But due to the intricacies of patent law and to the complex relationship between Apple and Microsoft, Apple will probably not be forced to pay significant fees to Microsoft for sales of the product it developed and popularized.

Macworld cites longtime industry analyst, Roger Kay, as saying that even if Microsoft were to win a patent challenge from Apple, the chances of it having any significant effect on Apple’s future business are slim.

“I think that in practical terms, no judge will allow Microsoft to stop Apple’s iPod business from going forward,” Kay, president of Endpoint Technologies Associates, told Macworld. “I think that if Microsoft makes a narrow claim stick, the settlement will be a cross-licensing deal with little or no money changing hands.”

Microsoft’s Director of Intellectual Property Licensing, David Kaefer, said in a statement last week the two companies close relationship and that Microsoft does tend to license its patents to other companies.

“In general, our policy is to allow others to license our patents so they can use our innovative methods in their products,” Kaefer said. “Microsoft and Apple have previously licensed their respective patent portfolios to one another and we maintain a good working relationship with Apple.”

Additionally, Apple has other legal protections to iPods’ use, one analyst said. “While this (patent issue) may point to a weakness in Apple’s IP ownership there are other patents that surround the iPod and may still protect it,” Rob Enderle, president of the Enderle Group, wrote on his Website. “In addition the Microsoft patent, depending on how you read it, may not be all that similar to Apple’s application further protecting Apple.

There is also a personal element involving Jobs and Gates, Enderle said. “Yes, it appears that Apple’s need for secrecy really got them in trouble because, instead of filing for a patent before the iPod was released they waited for a year and then recently discovered Microsoft had filed one first,” he said. “If Microsoft’s patent is upheld Apple will have to get license a from Microsoft. I’m guessing Bill Gates couldn’t be more pleased.”