Published May 05, 2005
Microsoft Corp. (MSFT) is trying to make some money off some of its spare technology, offering entrepreneurs and venture capitalists licenses to such inventions as tamperproof identification card software and computer tricks that make chintzy speakers sound top-notch.
Usually known for closely guarding the rights to its technology, Microsoft (search) touts its new program as a bid to help startups by giving them access to fruits of the company's research and development arm.
"If we pull this off, if we're able to collaborate effectively ... we can create new companies and new jobs," said David Harnett, senior director of Microsoft's Intellectual Property Ventures.
Microsoft announced the new program at a gathering of venture capitalists in New York on Wednesday.
To begin with, the Redmond-based software company is opening up access to 20 technologies — mostly ones that haven't yet made it onto the market.
The list includes:
— Conference XP, which uses high-performance audio, video and network technologies for distance conferencing.
— Face detection and tracking software.
— Natural language-processing technology that creates learning programs that adapt to students based on their answers to previous questions.
Michael Gartenberg, an analyst with Jupiter Research, said Microsoft is making a smart move. The company has spent billions of dollars on research and development, and has come up with some great ideas, he said, "probably far too many to ever be incorporated into products. So I think it's a great way for them to share those ideas with the marketplace."
"Microsoft Research is a pretty big organization. They do a lot of good work, and frankly some of the things they do are too far ahead or just don't fit into other corporate priorities," said Matt Rosoff, an analyst at Directions on Microsoft.
Eventually, Microsoft said, it will make more technologies available for licensing.
Agreements will be negotiated on a case-by-case basis, giving Microsoft part ownership in startups that buy rights to the company's technology, royalty payments, or both, said David Kaefer, director of business development for Microsoft's intellectual property and licensing group.
Kaefer said the company will model partnerships after a deal it recently launched with Inrix Inc. (search), a Redmond-based company founded by former Microsoft and online travel agency Expedia Inc. (search) employees.
Last month, Inrix bought an exclusive license from Microsoft for technology that helps predict traffic patterns.
Kaefer said Microsoft has a lot to gain by giving smaller businesses a way to take its technology and run with it.
"Obviously if we can accelerate the speed at which cool technologies reach the market, even if they're not in a Microsoft product, we count that as a success," Kaefer said.