Volume 2, Issue 3, September 2005 Patents on Compatibility Standards and Open Source – Do Patent Law Exceptions and Royalty-Free Requirements Make Sense? Mikko Välimäki * and Ville Oksanen ** Abstract This article discusses the problem that open source software can not support compatibility standards, which have patent royalties. As the use of open source continues to grow, the article asks whether it makes sense to include a compatibility exception in patent law or require royalty-free licenses in formal standardization organizations and procurement policies. The article proposes that the answer may not be in the patent policies – be they from the government or from industry standard bodies – but perhaps in the practices of individual companies. While some companies want to collect licenses for their “intellectual property” no matter what, one can also observe that some major information technology companies have recently dedicated patents on a royalty-free basis to the use of open source developers without any standardization or regulatory pressures. Encouraging such company practices might be the best option for a government if it considers patent royalties on compatibility standards a policy problem. DOI: 10.2966/scrip.020305.397 © Mikko Välimäki and Ville Oksanen 2005. This work is licensed through SCRIPT- ed Open Licence (SOL) . * Mikko Välimäki, Ph.D., LL.M., teaches technology law at the Helsinki University of Technology, Finland. He has consulted especially software companies and is the author of a book on open source licensing (available at http://pub.turre.com/ ). Previously Mr. Välimäki has been a visiting scholar at the University of California, Berkeley. He is also a co-founder and former chairman of Electronic Frontier Finland. ** Ville Oksanen works currently at Helsinki University of Technology as a researcher. He was a visiting scholar at UC-Berkeley 2002 and is now preparing his Ph.D. on the economic rationality of copyright system. Mr. Oksanen is currently the chairman of Electronic Frontier Finland, which he co- founded in 2001. He’s also co-chairing European Digital Right’s IP working group and has been EDRI's representative at several WIPO meetings.