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Patent abuse takes its toll on the German economy

by on02 April 2012

Microsoft flees the country

It seems that the current patent wars is taking its toll on the German economy. As patent trolls start to focus on Germany as a softtouch, it seems that Microsoft has shifted its European logistics center from Germany to the Netherlands.

The warehouse and distribution operation, based in North Rhine-Westphalia (Germany's most populous federal state), was operated by Arvato, a Bertelsmann subsidiary, as a service provider for Microsoft. Redmond has said that legal concerns are the only reason for which Microsoft is now moving this operation out of Germany. It does not have that many staff in Germany. About 50 will lose their jobs.

Microsoft is being sued in Germany by Motorola Mobility over patents that are allegedly essential to the ubiquitous H.264 video codec. The Mannheim Regional Court will hand down a decision in two weeks that could ban the sale of Windows 7, Internet Explorer 7 and Windows Media Player and the Xbox gaming console.

The court appeared to believe that Microsoft's and everyone else's products implementing the H.264 standard infringe on the asserted patents, and the presiding judge told Microsoft that it could not claim the Patent was invalid.

Motorola is demanding billions of dollars per year from Microsoft to license to its H.264-related patents.  Both Apple and Microsoft have lodged EU antitrust complaints against Motorola which are being investigated.

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