Coalition Challenges Digital TV Patent License Fees

Recently, an ad hoc group called the Coalition United to Terminate Financial Abuses of the Television Transition ("CUT FATT") has petitioned the FCC to require patent holders who charge "high" fees to prove that their license fees are reasonable, and have the FCC create basic rules for licensing of patents to prevent "possible price gouging."

From the press release:

Since July 1, 2007, the FCC has required that all televisions sold in the U.S. include a digital tuner built to the requirements of the Advanced Television Systems Committee (ATSC). Holders of the patents needed to meet these government-mandated requirements are demanding that American consumers pay between twenty and thirty dollars per television for the same patent rights that cost $1 or less in Europe, Japan and other parts of the world. It is estimated that in 2008 and 2009 alone, the aggregate royalty cost to American consumers will be well over one billion dollars for fees that would total only about $65 million in Europe and Japan. "Without action now, this abuse could continue for many years. We believe that the FCC must declare that any DTV royalty demands that exceed comparable international fees are a violation of FCC rules. We believe that any patent holder seeking higher fees should be required to prove to the FCC that their license fees are reasonable and non-discriminatory. We also believe the FCC should initiate a rulemaking proceeding in order to create a set of basic rules that apply to the licensing of all patents that are required to implement the FCC-mandated DTV receiver standards," states Laynie Newsome, VIZIO VP, Sales & Marketing Communications and Co-Founder.

Read more here and here.