Study: Windows costs $21.50 extra in “patent tax”

According to a calculation done by the Software Freedom Law Center (SFLA), users of Microsoft Windows are paying as much as $21.50 more for each copy of the operating system they buy, thanks to the so-called “patent tax” that Microsoft is forced to pay to various companies that hold software patents.
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The calculation is based on Microsoft’s public statements that the company pays over $100 million each year in legal fees alone to protect itself from some 35 to 40 patent lawsuits. Recently, Microsoft has forked over significant sums to other technology companies to settle patent disputes: $1.25 billion to Sun, $536 million to Novell, and $1.52 billion to Alcatel-Lucent are just some examples. The total payouts over the last three years add up to more than $4 billion dollars.

SFLA took the total of $4.3 billion dollars in legal costs for Microsoft from 2001 to 2004 and divided it by estimated sales of Windows XP over the same period—approximately 200 million copies—to come up with the $21.50 estimate. The organization added that North American and European customers, who pay more for Windows licenses than customers in other parts of the world, actually ended up paying more of this “patent tax,” and that people who pirate Windows pass their share of the tax on to paying customers.

The study concludes by pointing out that Linux, as a free and open-sourced operating system, has no “patent tax” at all, and suggests that this be taken into consideration when choosing operating systems for deployment in places such as schools.

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