IP Licensing Expanded to Research

As part of an initiative to earn more money from its intellectual property portfolio, Microsoft has created a program for start-up companies to license technology from Microsoft Research (MSR). Although most of the available technologies are too specialized to be of interest to Microsoft, a handful could find their way into Microsoft products, meaning that licensees could eventually find themselves in competition with the company.

Turning Ideas into Cash

The new licensing program emerged from Microsoft’s revamped intellectual property (IP) strategy, which was instituted in 2003 under the leadership of Vice President Marshall Phelps, who helped IBM build a US$1 billion annual business from IP licensing. As part of this strategy, Microsoft began charging licensing fees for some widely used technologies on which it had patents, such as the File Allocation Table (FAT) file system (which is used by manufacturers of mobile storage devices), and entered IP cross-licensing agreements with established technology companies such as Autodesk, Citrix, and Siemens.