If you feel that Vizio should shave $30 off the price of its TVs, listen up: The Irvine TV company agrees. You could help the company by supporting Vizio’s petition to the U.S. Federal Communications Commission, which is accepting comments until Monday.
On Monday, the FCC will move to the next stage of deciding whether to modify its policies about digital television patent licensing.
At issue are royalty fees that Vizio and other TV makers pays patent owners of the ATSC digital TV tuner, a technology required in every TV sold in the United States. Vizio says it sets aside $30 per TV to pay royalty fees related to the ATSC tuner. That’s pretty steep if it’s Vizio’s new 19-inch VA19L for $249. The extra fee is 12 percent of the total cost. And even if the price goes down — it’s $199.99 at Costco.com — Vizio still has to pay $30 for that single digital tuner.
But that’s not the outrageous part, at least from Vizio’s perspective. The company says foreign companies are buying up digital TV patents and demanding excessive fees randomly. Vizio says it is being unfairly singled out because of its success — it went from 2002 start-up to the nation’s top 3 TV brand last year.
“The fact that in the second quarter of 2008, we received recognition for being the number one in market share (in plasma TVs), we were identified as a potential target for both valid and invalid claims,” said Laynie Newsome, VIZIO co-founder and vice president of sales, marketing and communications.
“When you look at the amount of money of royalties to the cost of the whole (TV), it’s a disproportionate percentage. It’s extremely burdensome. It became more of an issue to us that the consumer should pay so much more money.”
Vizio obviously has its own spin on this. But the company is under attack. On April 10, Japan’s Funai Electric Co., which acquired some digital TV patents from Thompson and RCA, won a ruling by the U.S. International Trade Commission to stop Vizio from importing digital TVs to sell in the United States. Read the rest of this entry »