Microsoft Opens Hardware Licensing

Microsoft is expanding its intellectual property licensing initiatives
beyond its software business to its hardware business.

Though Microsoft is best known as a software company, it also researches and
develops various hardware technologies, typically related to mice and

Three different Microsoft hardware technologies are now being
made available to interested third parties for licensing.

Microsoft’s “Tilt
Wheel” technology enables keyboard and/or mice users to more easily maneuver
their devices side to side and up and down. The Magnifier technology provides
zoom in/out functionality. And U2 is an auto sensing USB and PS2 technology that
enables easier device connection.

David Kaefer, director of business development in Microsoft’s IP licensing
group, explained that, to date, Microsoft has done a little bit of hardware
licensing but mostly in the cross licensing area as opposed to licensing its
own IP.

“This is really the first example of an attempt to put predictable
programatized offerings out there with features that people are willing to
pay price premiums for,” Kaefer told

End users won’t even necessarily know that U2, Magnifier or
Tilt are Microsoft licensed entities. Kaefer explained that the hardware IP
licensing initiative does not include a trademark licensing component. As
such, Microsoft branding is not being passed on.

Both Microsoft and third-party hardware vendors are expected to benefit from
the new licensing initiative.

Kaefer expects that licensees can command a $10 to $15 premium on
mice that include the newly opened Microsoft hardware IP. He explained that
the Microsoft licensing cost would run between 30 and 35 cents a unit.

“When you look at what’s left for the partner it becomes a very interesting
opportunity for them,” Kaefer said.

One particularly well-known Microsoft Hardware technology is not being
opened to licensing at this time: Microsoft’s Ergonomic keyboards.

Kaefer noted that Microsoft doesn’t have any plans at this time about
licensing the keyboard technology, “but we encourage people to approach
us with ideas.”

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