In January, Taiwan's Fair Trade Commission (FTC) levied $430,000 in fines against Philips, Sony Corp. and Taiyo Yuden Co. Ltd. for collusion in charging high royalty fees and abusing their CD-R market positions, according to an FTC official.
Philips Research, on behalf of Philips, Sony and Taiyo Yuden, announced in April that four additional Sony patents are likely to be brought into a collective agreement involving a "future revision of the CD-R patent portfolio," which could change the cost of royalty licensing. However, that will not effect Philips' royalties in Taiwan. "In Taiwan, because of the FTC ruling, Philips, Sony and Taiyo Yuden license separately," the Philips spokeswoman said. "Everywhere else Philips collects on behalf of the patent holders and then an internal calculation is made."
Originally the Taiwanese manufacturers cried foul over CD-R royalties that hadn't changed in more than five years, when retail prices for disks were far higher than today. "The price has plunged so quickly, but the royalty has stayed the same. That's not fair," said Sean Lee, an executive at Ritek. Sources familiar with the standoff said some CD-R makers wouldn't open their books to Philips so the company could determine whether royalty payments accurately reflected unit shipments..." NULL