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RE: ACTION-985: relevant terminology for section 5.

From: Jo Rabin <jrabin@mtld.mobi>
Date: Mon, 22 Jun 2009 15:28:39 +0100
Message-ID: <C8FFD98530207F40BD8D2CAD608B50B401FF3BEA@mtldsvr01.DotMobi.local>
To: "Eduardo Casais" <casays@yahoo.com>, <public-bpwg@w3.org>
Thanks Eduardo for this monumental work.

In short I adopted *almost* exactly the wording you propose in version 1s.

Jo

> -----Original Message-----
> From: public-bpwg-request@w3.org [mailto:public-bpwg-request@w3.org] On
> Behalf Of Eduardo Casais
> Sent: 18 June 2009 18:55
> To: public-bpwg@w3.org
> Subject: ACTION-985: relevant terminology for section 5.
> 
> 
> ACTION-985.
> 
> The action is "assess whether there is any relevant terminology we can
> quote in
> respect of last para of Section 5".
> 
> I have reviewed the general understanding of the terms, and how they
> appear in W3C,
> IETF, 3GPP, OMA, EU, GNU documents. People uninterested in the longish
> survey details
> can jump to conclusions at the end.
> 
> 
> GENERAL.
> 
> The Wikipedia contains a nice summary of the issue.
> http://en.wikipedia.org/wiki/Fair,_Reasonable_and_Non_Discriminatory_te

> rms
> which is most often framed in terms of access to IPR.
> 
>     "In licensing, Fair, Reasonable and Non Discriminatory terms
> (FRAND) refers to
>     the obligation that is often required by Standards Setting
> Organizations (SSOs)
>     for members which participate in the standard setting process.
>     [...]
>     While there are no legal precedents to spell out specifically what
> the actual
>     terms mean, it can be interpreted from the testimony of people like
> Professor
>     Mark Lemley from Stanford University, in front of the United States
> Senate
>     Committee on the Judiciary that the individual terms are defined as
> follows:
> 
>     Fair relates mainly to the underlying licensing terms. Drawing from
> anti-trust /
>     competition law; fair terms means terms which are not
> anticompetitive and that
>     would not be considered unlawful if imposed by a dominant firm in
> their relative
>     market. Examples of terms that would breach this commitment are;
> requiring
>     licensees to buy licenses for products that they do not want in
> order to get a
>     license for the products they do want (bundling), requiring
> licensees to license
>     their own IP to the licensor for free (free grant backs) and
> including
>     restrictive conditions on licensees’ dealings with competitors
> (mandatory
>     exclusivity).
> 
>     Reasonable refers mainly to the licensing rates. A reasonable
> licensing rate is
>     a rate charged on licenses which would not be result in an
> unreasonable aggregate
>     rate if all licensees charged a similar rate. Clearly aggregate
> rates that would
>     significantly increase the cost to the industry and make the
> industry
>     uncompetitive are unreasonable. It is worth noting that a licensor
> which has
>     several different licensing packages might be tempted to have both
> reasonable and
>     unreasonable packages. However having a reasonable “bundled” rate
> does not excuse
>     having unreasonable licensing rates for smaller unbundled packages.
> All licensing
>     rates must be reasonable.
> 
>     Non-Discriminatory relates to both the terms and the rates included
> in licensing
>     agreements. As the name suggests this commitment requires that
> licensors treat
>     each individual licensee in a similar manner. This does not mean
> that the rates
>     and payment terms can’t change dependent on the volume and
> creditworthiness of
>     the licensee. However it does mean that the underlying licensing
> condition
>     included in a licensing agreement must be the same regardless of
> the licensee.
>     This obligation is included in order to maintain a level playing
> field with
>     respect to existing competitors, and to ensure the potential new
> entrants are
>     free to enter the market on the same basis."
> 
> 
> 
> W3C
> 
> The W3C attempted to set its original IPR policy on such a concept in
> http://www.w3.org/TR/2001/WD-patent-policy-20010816 as a form of
> licensing:
> 
>     "(e) RAND License
> 
>     RAND stands for "reasonable and non-discriminatory" terms. A "RAND
> License" shall
>     mean a license that:
>          shall be available to all implementers worldwide, whether or
> not they are
>          W3C Members;
>          shall extend to all Essential Claims owned or controlled by
> the licensor and
>          its Affiliates (except as described in section 8.2 concerning
> licenses
>          relating to Contributions);
>          may be limited to implementations of the Recommendation, and
> to what is
>          required by the Recommendation;
>          may be conditioned on a grant of a reciprocal RAND License to
> all Essential
>          Claims owned or controlled by the licensee and its Affiliates.
> For example,
>          a reciprocal license may be required to be available to all,
> and a
>          reciprocal license may itself be conditioned on a further
> reciprocal license
>          from all (including, in the case of a license to a
> Contribution, the
>          original licensee).
>          may be conditioned on payment of reasonable, non-
> discriminatory royalties or
>          fees;
>          may not impose any further conditions or restrictions on the
> use of any
>          technology, intellectual property rights, or other
> restrictions on behavior
>          of the licensee, but may include reasonable, customary terms
> relating to
>          operation or maintenance of the license relationship such as
> the following:
>          audit (when relevant to fees), choice of law, and dispute
> resolution."
> 
> This approach generated a wave of protest from the developers'
> community (the mailing
> list archives keep trace of the furore), which led the W3C to eliminate
> this mode of
> licensing for royalty-free access to IPR. The latest version of the
> document is
> http://www.w3.org/Consortium/Patent-Policy-20040205.

> 
>     "5. W3C Royalty-Free (RF) Licensing Requirements
>     [...]
>     1. shall be available to all, worldwide, whether or not they are
> W3C Members;
>     2. shall extend to all Essential Claims owned or controlled by the
> licensor;
>     3. may be limited to implementations of the Recommendation, and to
> what is
>        required by the Recommendation;
>     4. may be conditioned on a grant of a reciprocal RF license (as
> defined in this
>        policy) to all Essential Claims owned or controlled by the
> licensee. A
>        reciprocal license may be required to be available to all, and a
> reciprocal
>        license may itself be conditioned on a further reciprocal
> license from all.
>     5. may not be conditioned on payment of royalties, fees or other
> consideration;
>     6. may be suspended with respect to any licensee when licensor is
> sued by
>        licensee for infringement of claims essential to implement any
> W3C
>        Recommendation;
>     7. may not impose any further conditions or restrictions on the use
> of any
>        technology, intellectual property rights, or other restrictions
> on behavior
>        of the licensee, but may include reasonable, customary terms
> relating to
>        operation or maintenance of the license relationship such as the
> following:
>        choice of law and dispute resolution;
>     8. shall not be considered accepted by an implementer who manifests
> an intent
>        not to accept the terms of the W3C Royalty-Free license as
> offered by the
>        licensor."
> 
> The points appearing relevant to the CTG are no. 1, 5, 7, 8.
> 
> 
> 
> IETF
> 
> The concept appears in several documents of the IETF related to the
> disclosure of
> IPR during the elaboration of a standard, most importantly:
> 
> RFC3669, 02.2004 - Guidelines for Working Groups on Intellectual
> Property Issues
> RFC3979, 03.2005 - Intellectual Property Rights in IETF Technology
> 
> RFC3669 is a list of recommendations to IETF members on how to deal
> with assertions
> of IPR from corporations. It indicates that:
> 
>    "Words such as "reasonable", "fair", and "non-discriminatory" have
> no
>    objective legal or financial definition.  The actual licensing terms
>    can vary tremendously.  Also, IPR claimants have occasionally
>    asserted that there were already sufficient licenses for a
> particular
>    technology to meet "reasonable" multisource and competitiveness
>    requirements and, hence, that refusing to grant any licenses to new
>    applicants was both fair and non-discriminatory.  The best way to
>    find out what an IPR claimant really means by those terms is to ask,
>    explicitly."
> 
> RFC3979 is the document regulating the disclosure process. It states
> the following:
> 
>    "4.1.  No Determination of Reasonable and Non-discriminatory Terms
> 
>    The IESG will not make any explicit determination that the assurance
>    of reasonable and non-discriminatory terms or any other terms for
> the
>    use of an Implementing Technology has been fulfilled in practice.
> It
>    will instead apply the normal requirements for the advancement of
>    Internet Standards."
> 
> 
> 
> 3GPP
> 
> Third Generation Partnership Project Agreement for 3GPP2 (01.1999)
> discusses the
> disclosure of IPR and their licensing:
> 
>     "3.1 Undertakings of Organizational Partners.
>     The Organizational Partners shall undertake to:
>     [...]
>     encourage their respective members to declare their willingness to
> grant
>     licences on fair, reasonable terms and conditions on a non
> discriminatory
>     basis, and consistent with their IPR Policy;"
> 
> The terms are supposed to be understood and are not further defined.
> 
> 
> 
> OMA
> 
> The Open Mobile Alliance also provides for disclosure of IPR and
> granting of licenses
> under FRAND conditions (Open Mobile Alliance IPR Procedural Guidelines
> For OMA
> Members, 02.2004):
> 
>     "Upon disclosure of an Essential IPR, the Open Mobile Alliance
> shall ask the
>     relevant Member to give a declaration that it will license such
> Essential IPR
>     in accordance with the Application Form (i.e. on fair, reasonable
> and
>     non-discriminatory terms)."
> 
> The terms are supposed to be understood and are not further defined.
> 
> 
> 
> EU
> 
> In its R&D programmes, the EU sets a series of conditions for partners
> in a project
> to access "foreground" and "background" technology. The Guide to
> Intellectual
> Property Rules for FP7 projects
> (ftp://ftp.cordis.europa.eu/pub/fp7/docs/ipr_en.pdf)
> states:
> 
>     "8.8. Conditions for access rights: Royalty-free or fair and
> reasonable
>      conditions
>     [...]
>     Fair and reasonable conditions means appropriate conditions
> including possible
>     financial terms (market conditions or other) taking into account
> the specific
>     circumstances of the request for access, for example the actual or
> potential
>     value of the foreground or background concerned and/or the scope,
> duration or
>     other characteristics of the use envisaged (see Article 2.3 RfP ;
> Article II.1.6
>     of ECGA)."
> 
> Precise definitions of the conditions are typically left to so-called
> consortium
> agreements.
> 
> 
> 
> GNU
> 
> The Free Software Foundation considers IPR that gets embodied in
> software in its page
> http://www.gnu.org/Confusing%20Words%20and%20Phrases%20that%20are%20Wor

> th%20Avoiding%20-%20GNU%20Project%20-
> %20Free%20Software%20Foundation%20(FSF).htm
> 
>     "RAND (reasonable and non-discriminatory)
> 
>     Standards bodies that promulgate patent-restricted standards that
> prohibit free
>     software typically have a policy of obtaining patent licenses that
> require a
>     fixed fee per copy of a conforming program. They often refer to
> such licenses
>     by the term 'RAND,' which stands for 'reasonable and non-
> discriminatory..'
> 
>     That term white-washes a class of patent licenses that are normally
> neither
>     reasonable nor non-discriminatory.
>     [...]
>     We suggest the term 'uniform fee only,' or 'UFO' for short, as a
> replacement.
>     It is accurate because the only condition in these licenses is a
> uniform royalty
>     fee."
> 
> 
> 
> CONCLUDING REMARKS
> 
> a) The inclusion of a requirement for access to technology under fair,
> reasonable and
> non-discriminatory conditions is a standard element appearing in
> practically every
> normative effort;
> b) The absence of such clauses implies that unfair, unreasonable (i.e.
> exhorbitant)
> or discriminatory practices may be acceptable.
> c) No standardization organization endeavours to inspect each
> participant's terms to
> check them for fairness, reasonableness or non-discriminatory aspects;
> the principle
> of good faith prevails.
> d) Although no precise definition of the wording can be fixed, there is
> a general
> understanding of their meaning, which is shaped by the context, the
> technology, the
> standardization activity, past practices and the participants involved.
> In case of
> serious conflicts, courts or arbitration organizations must settle the
> question.
> 
> >From this perspective, I propose to lift the standard terminology and
> some text from
> the W3C IPR policy document to include in section 5 as follows:
> 
> "Such access is granted under fair, reasonable and non-discriminatory
> conditions. In
> particular:
> 1. it is available to all, worldwide, whether or not they are W3C
> Members;
> 2. it does not impose any further conditions or restrictions on the use
> of any
> technology, intellectual property rights, or other restrictions on
> behaviour of the
> tester, but may include reasonable, customary terms relating to
> operation or
> maintenance of the relationship between tester and proxy operator such
> as the
> following: choice of law and dispute resolution, confidentiality of
> parameters to
> access the interface, disclaimer of liability."
> 
> This should be sufficient to address my personal concerns:
> a) that access to the interface is conditional on registration to an
> expensive or
> constraining partnership programme;
> b) that utilization of the interface is granted only if the results of
> testing are
> published only with the permission of the proxy operator;
> c) that the proxy operator wants some kind of priority or advantage
> with respect to
> the applications tested through the interface.
> 
> I understand that a blanket imposition of entirely free access to such
> testing
> interfaces may put off some operators (though I am sure several will
> provide such
> free facilities). On the other hand, "reasonable" conditions might
> become quickly
> quite expensive for small and medium sized enterprises that must test
> and re-test
> the suitability of transformation proxies in a multitude of operator
> networks. In
> the absence of a free access to such interfaces, the presence of an
> official mailing
> list is all the more essential to gather and disseminate the results of
> testing with
> various proxies (see my other message)...
> 
> 
> 
> E.Casais
> 
> 
> 
> 

Received on Monday, 22 June 2009 14:29:12 UTC

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