Is the SD Association Trying to Bully Eye-Fi Out of Intellectual Property?

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Update 1/24/12, 2:55 p.m. PST: Eye-Fi CEO Yuval Koren has submitted responses via email to a list of questions sent to him by the author after this article was published. For more, see the follow-up interview with Yuval Koren.

Update 1/20/12, 4:23 p.m. PST: Added official statement from the SD Association regarding the specification process.

The current mobile-technology landscape is partially defined by large companies suing and countersuing one another over patents. By and large, many of those legal battles revolve around acquired patent portfolios, vaguely defined processes, and commonplace features. The underlying goals seem to be delaying and crippling competing products, cashing in on lucrative licensing deals, and jockeying for a more-desirable position in the mobile marketplace.

In the world of cameras, another patent battle is taking shape. This one may serve as a better reminder as to why patent laws exist in the first place, depending on some crucial information that has yet to come to light.

Eye-Fi, a company that has been making Wi-Fi-enabled SD Cards almost exclusively for seven years, claims that the Secure Digital Association has announced a similar wireless-card standard that may infringe upon Eye-Fi's related patents.

The iSDIO (Intelligent SD Input-Output) spec is a wireless-card specification that essentially replicates the sharing-over-Wi-Fi functionality found in Eye-Fi's range of SD Cards. The specification would allow any SD Card maker to enable in-camera uploads, peer-to-peer sharing between devices, and home-network backup via Wi-Fi, all without paying any licensing fees to Eye-Fi.

Eye-Fi's chief complaint is that the SDA didn't follow its own guidelines for announcing the new iSDIO specification, especially in light of how similar the new specification is to Eye-Fi's own patented, wireless in-card technologies.

On the company's blog, Eye-Fi CEO Yuval Koren stated that his company was denied a chance to submit intellectual-property claims before the SDA announced iSDIO as a new specification. For more detail, see the full post on the Eye-Fi site.

"Last week, the SD Association (SDA) announced that a draft Wireless LAN specification had been adopted as a new standard," Koren writes in the post. "This was a flat out misrepresentation."

Koren also claims that the SDA didn't adhere to its own rules of reviewing intellectual-property claims and revising specification details accordingly before announcing the new iSDIO standard.

"Under the SDA's own rules, this was not possible," Koren writes. "SDA members--and we are one--are allowed 60 days in which to respond with claims to patented intellectual property and plans around licensing that IP to the SDA."

"This week, still in advance of the SDA-provided deadline, we disclosed our patented intellectual property to the SDA, detailing multiple Eye-Fi patents essential to the current SDA draft specification," Koren writes. "There is a process for the establishment of this kind of specification, and that process wasn't respected."

In response to a request for comment, the SDA provided a statement indicating that the specification-approval process is still in the works; however, the statement doesn't explain the fact that the association has already referred to iSDIO as a "standard" on its website.

"The SD Association is a member-driven organization that adheres to rigorous processes to develop the technical specifications of our standards to ensure that all SD memory cards and products are interoperable," the statement reads. "Once members in our Technical Committee have approved a standard, it is then made available to all members for IP review prior to formal ratification. The IP review period for iSDIO began November 28, 2011, and will end January 27, 2012. Any IP issues that arise will be handled in accordance to SDA policies and procedures."

In light of the SDA's official comment, the SDA appears to have jumped the gun in announcing the new spec before the IP review was complete, and before the body's executive members voted on whether to ratify the iSDIO specification.

This dispute is still very much in the "he-said, they-said" stage of the game, and key details essential to the story and the potential legal battle have yet to surface, such as whether the iSDIO spec completely replicates Eye-Fi's in-card technologies and whether Eye-Fi will be willing to license its patented technology to reap potentially major benefits.

In the worst-case scenario, this looks like a case of "big, powerful standardization body bullies the little guy," a potential abuse of power driven by other members of the SDA that want in on the wireless-SD Card market that Eye-Fi currently dominates.

And in the best-case scenario, it could end up being quite lucrative to Eye-Fi via a licensing deal, as a successful patent claim on the wireless technology embedded in iSDIO cards would translate to a chunk of money going to Eye-Fi with every iSDIO card sold.

In the middle ground between those two extremes is where this story currently lies: It looks like the SDA skipped some important steps in the specification process, and the resulting anger and frustration in Koren's statement is both palpable and understandable.

"The intellectual property at the core of this digital imaging revolution is our business," writes Koren on the blog. "It's what Eye-Fi is. And as currently written, essential Eye-Fi patented technology would be violated by anyone implementing this draft specification."

There's no doubt that standards--especially those that involve platform- and company-independent sharing of content--are good for the industry overall, but only if the innovators behind the technology are rewarded appropriately; if not, there's absolutely no incentive to innovate and drive new ideas in the marketplace.

In Video: Eye-Fi in Dispute with SD Association Over Wireless SD Card Spec

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