Re: [ARSCLIST] and what about that patent?

[David Seubert <seubert@xxxxxxxxxxxxxxxx>]

While legally Ampex could enforce this patent, ethically and
practically they could not. They created a defective product and it was
their responsibility to find a solution. I suspect that this patent was
filed without ever intending to enforce it, knowing that it would be a
customer relations disaster to try to profit from their mistake. At
least I hope that was their intent. Ten years later it's hard to say
what their lawyers and accounts might think, but frankly, I don't care.

I'm surprised that there has never been any legal action against Ampex
for the sticky-shed problem. While nobody has died from their defective
product, it still has caused millions of dollars in damage to their
customers. Enforcing this patent would be a bit like Merck selling
heart attack medicine to patients who took Vioxx. Ampex took some
responsibility for the mistake and developed a solution and made the
information available, while not profiting from the solution. For that
they are to be commended, but it still doesn't change the fact that
their product was defective. Regardless of who "owns" this technique, I
will continue to bake tapes with no remorse and I think others should
do the same.

David Seubert
UCSB


On Tuesday, December 14, 2004, at 06:37 PM, James Lindner wrote:

> FYI a follow up on articles regarding Ampex and Patent enforcement.
>
> http://www.nwfusion.com/news/2004/1130sonytopa.html
>
> http://www.forbes.com/associatedpress/feeds/ap/2004/11/29/
> ap1678714.html
>
> And this from the "Chairman's Letter" in the 2003 annual report
>
> Snip..." The greatest contributor to Ampex's 17.2% increase in overall
> revenues and to the improved operating profits in 2003 was income from
> our
> licensing portfolio of digital imaging patents. As I forecasted in last
> year's letter, royalty income improved significantly, rising to $10.1
> million from $4.0 million in the previous year. Some of the increase
> resulted from payments by licensees that were actually due to us in
> earlier
> periods, but ongoing royalties are now running at a rate significantly
> greater than in 2002. Encouragingly, substantially all of our
> royalties now
> come from digital video recorders and camcorders rather than from
> analog
> products that are now largely obsolete.
>
> As discussed in previous annual reports, licensing income has tended
> to be
> volatile and difficult to forecast. In 2003 our royalty income was
> solely
> generated by digital videotape recorders and camcorders. Starting two
> years
> ago we have been moving aggressively to broaden the base of royalties
> to
> include additional areas of consumer electronics where we believe our
> patented technology is being used. These markets include DVD recorders
> and
> players, digital still cameras and digital television receivers, each
> of
> which represents large future market opportunities.
>
> I am pleased to report that, after the year end, we negotiated our
> first
> license for DVD recorders, which we expect to sign shortly. This new
> licensee, a multi-billion dollar manufacturer of consumer electronic
> products based in Japan, has informed us that they expect to begin
> production later this year of certain new products that will use our
> patents. Since these products have not yet been marketed, it is not
> possible
> to forecast the revenue impact on Ampex this year, but is an
> indication that
> developments in the DVD market may be moving favorably for us.
>
> At the end of 2002, we had notified 17 manufacturers of digital still
> cameras of their potential infringement of our patents and, as of
> today, we
> believe we have put substantially all major manufacturers on notice.We
> are
> currently in advanced negotiations for our first patent license in the
> digital still camera field with one of the largest manufacturers in
> this
> market, but we are at present far apart on financial terms. While we
> hope to
> arrive at a satisfactory agreement it is reasonably likely that, as I
> mentioned in last year's letter, litigation will become necessary. We
> will,
> of course, announce developments in this situation as they occur.
>
> There are several negotiations under way with other potential
> licensees, not
> just digital still cameras but also other products that we believe to
> be
> infringing our patents. It is too early to say what impact, if any,
> these
> negotiations will have in 2004. However, Ampex has been in the
> licensing
> business for more than 30 years and our patent portfolio is the result
> of
> substantial and forward-looking investments in research and
> development of
> digital imaging technology over many years. An expanded licensing
> program
> has the potential to produce a dramatic change in Ampex's financial
> outlook
> and our strategy is to pursue these opportunities aggressively.
>
> As we have said in previous letters, our preference is to avoid the
> substantial expenses that patent lawsuits involve. However, if we do
> have to
> litigate, our recent financial performance has substantially improved
> our
> ability to do so. The management team has done an excellent job of cash
> generation and our liquid resources should be more than adequate for
> any
> litigation costs that can currently be foreseen." Snip....
>
> Clearly Ampex is now in the patent enforcement business. 'Nuff said on
> this
> topic.
>
> jim
>
> *
>         Jim Lindner
> *
>         Media Matters, LLC
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>         Email: jim@xxxxxxxxxxxxxxxxx
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