================================================================================
To:   ALL                        Number:  1828   
From: RMARKS@ECDCSVR.TREDYDEV.U  Refer #: None      (Echo)
Date: 01-10-95 10:31             Recvd:   No
Subj: **** Official Unisys FAQ   Conf:    2333 comp.sys.unisys
BBS:  Rose Media Incorporated.
--------------------------------------------------------------------------------

Newsgroups: comp.sys.unisys
From: rmarks@ecdcsvr.tredydev.unisys.com (Richard Marks)
Subject: **** Official Unisys FAQ regarding LZW patent
Message-ID: <1995Jan6.220717.8292@ecdcsvr.tredydev.unisys.com>
X-Gated-By: Usenet <==> RoseMail Gateway (v1.70)
Date: Fri, 6 Jan 1995 22:07:17 GMT
Organization: Unisys Corp. Tredyffrin PA
Lines: 208



Unisys LZW Patent FREQUENTLY ASKED QUESTIONS             January 6, 1995

Since we released our statement this morning clarifying the terms of our
LZW patent licensing agreement, we have received several questions from
both the press and the on-line community at large.  We thought we would
share with you some of the most frequently asked questions -- and our
answers.  We hope this may help answer some similar questions you have.


What is the LZW patent?

The LZW patent covers methods and apparatus for lossless compression and
decompression of digital data.  Unisys holds a U.S.  patent (number
4,558,302) as well as equivalent patents on the technology in Canada,
France, Germany, U.K.  and Italy.  Equivalent patents are also pending
in Japan.


How did Unisys get the patent?

Data compression and decompression is a critical aspect of data
transmission and storage and is very much of interest to Unisys and the
industry.  The patent is the result of research done by Terry Welch at
Sperry Corporation in the early 1980s that extended previous work by
researchers Lempel and Zev.  Sperry Corporation was granted the U.S.
patent in 1985.  Sperry and Burroughs merged in 1986 to form Unisys,
thus Unisys became the owner of the Sperry patents.


Why is LZW so widely used?

It is a very efficient compression method and a highly advantageous way
of compressing and decompressing data for a wide variety of purposes.
It is easy to implement, operates at high speed and results in high
compression ratios without loss of data (that is, it significantly
shrinks the file size).


GIF has been in use since 1987.  Why is Unisys enforcing its rights now?

Unisys only became aware of the use of LZW in the GIF specification two
years ago.  We immediately began negotiations with CompuServe at that
time and reached an agreement in June, 1994.  The existence of the
patent has never been a secret.  In fact, we have completed licensing
agreements for LZW technology with over 100 companies since 1990, for
products including hardware, software and on-line information services.
With most of these companies, it was the licensees who approached
Unisys, not Unisys forcing the taking of a license.


Why did it take you so long -- almost five years -- to figure out that
GIF was infringing on your patent?

As is common in industry, we don't have massive people resources devoted
to searching and finding products which may be infringing and then
undertaking the complex task of reverse engineering the products to
determine whether or not they have infringed on the patent.  In the case
of GIF, as soon as we became aware we immediately sought to protect the
patent through a license to CompuServe.


Is this part of a larger campaign to enhance your revenues?

No.  The actual revenue derived from this particular patent is not
significant.  However, Unisys has invested hundreds of millions of
dollars in overall technology development and has protected its
investments in the form of thousands of patents.  We have a
responsibility to our shareholders to ensure that we protect these
valuable company assets.


Why have you targeted the on-line industry now?

Unisys has not specifically targeted the on-line industry, evidenced by
the fact that we have licensed this technology to hardware, software and
information services companies over the past several years.  We became
aware of the applicability of our patent to the GIF specification and we
simply undertook negotiations with CompuServe as the primary stakeholder
in this specification.  The announcement content and timing of
CompuServe's action was solely a CompuServe business decision.


The agreement with CompuServe says I can only use GIF in accessing
CompuServe? What about other on-line services?

Our relicensing agreement with CompuServe allows CompuServe to relicense
the technology only for use in accessing the CompuServe information
network.  However, commercial, for-profit developers are free to contact
us to secure a license for LZW.  Non-commercial, non-profit users aren't
required to secure a license to use the technology.


Is Unisys willing to negotiate with other developers?

Absolutely.  Unisys wants to encourage the use of its patented
technology and is therefore continuing to make licenses available under
the patent at reasonable and non-discriminatory terms and conditions to
any interested party.  Keep in mind that Unisys can only license the
patented LZW technology.  Unisys has no other stake in GIF (other than
using it for our own graphics transmission).


What do you consider "reasonable terms"?

While we will conduct negotiations with each applying developer, the
CompuServe royalty rate is somewhat indicative of the terms that should
cause no financial barrier to product entry into the on- line
marketplace, or anywhere else.  The CompuServe agreement calls for the
company to pay Unisys a royalty of approximately 1% of the selling cost
of the product for each product sold and connected to the on-line
service.  Given the calculation of the average price of CompuServe
products, this came out to about 11 cents per product sold and
connected.


GIF is used extensively on the World Wide Web.  What does Unisys intend
to do there?

Unisys in no way wants to discourage end users and developers from
making use of this technology.  We intend to license commercial software
developers.  However, non-commercial, non-profit products, including
freeware, need not pay license fees.  Organizations introducing a World
Wide Web server and home page to the Internet are not expected to
license the technology if they used a third-party software application
to develop their server offering.  Only the commercial third-party
developer in that case should secure a license.


What about Internet browsers?

Again, our focus is on the developers and not on the end user.  Also,
our action is primarily focused on for-profit developers.  If a
developer intends to make a profit or provide a product for commercial
use, they should negotiate a license from Unisys.


Will this hurt the use of GIF?

We certainly hope not.  GIF has been outstanding for handling graphics
files and its use of LZW technology is one of the factors in its
success.  Again, the licensing terms are very modest and should not be a
barrier to its use.


Will users of CompuServe have to pay a royalty to Unisys every time they
upload or download a GIF file?

No.  Revenue to Unisys under the CompuServe license is independent of
the number of files transferred.


What will be the impact on end users and commercial software developers?

There should be no impact on individual end users.  We encourage them to
take full advantage of GIF.  For developers, the impact should be
minimal.  Again, Unisys continues to make licenses under the patent
available to any interested party at reasonable and non-discriminatory
terms and conditions.  License fees for this technology should not be a
barrier to any software developer.


Why did you announce the changes during the Christmas holiday?

We concluded the license with CompuServe on June 21, 1994.  CompuServe
was given six months to implement the terms of the license agreement.
CompuServe asked for, and we granted, a one- month extension.  The
timing and content of the announcement, and for that matter, the need
for the announcement, were entirely of CompuServe's choosing and without
Unisys knowledge or approval.


I'm using freeware or shareware that can manipulate GIF files.  Can I
still use it?

Yes.


What about freeware developers?

Our focus is on commercial, for-profit developers.  Freeware is exempted
from licensing fees.


And shareware developers?

Shareware developers that intend to make a profit from their software
should negotiate a license with Unisys.  Alternatively, if their
software is intended to access CompuServe only, they might want to take
advantage of CompuServe's relicensing agreement with us.


Was the Unisys patent ever challenged?

The Unisys LZW patent was challenged in 1993, re-examined by the United
States Patent and Trademark Office, and the patentability of all claims
was reconfirmed in January of 1994.  This is a valid and fully
enforceable patent.

Or via Internet, send E-mail to LZW_INFO@UNISYS.COM, or use a form
available on the Home Page of the Unisys Web Server
(http:\\www.unisys.com) to request follow-up information.


Media contacts: Unisys Public Relations -- Bob O'Leary   (215) 986-6413
                                        or Oliver Picher (215) 986-5367

                                                                  
================================================================================
To:   ALL                        Number:  1833   
From: ED@TITIPU.RESUN.COM (EDWA  Refer #: None      (Echo)
Date: 01-10-95 21:49             Recvd:   No
Subj: Repost: comments on GIF l  Conf:    2333 comp.sys.unisys
BBS:  Rose Media Incorporated.
--------------------------------------------------------------------------------

From: ed@titipu.resun.com (Edward Reid)
Newsgroups: comp.sys.unisys
Subject: Repost: comments on GIF licensing
Date: Sat, 7 Jan 95 13:51:41 EST(-0500)
Organization: Paleolithic Refugia
Message-ID: <01010064.j8j7di@titipu.resun.com>
X-Gated-By: Usenet <==> RoseMail Gateway (v1.70)
Reply-To: ed%blkhole@sdd.hp.com
X-Mailer: uAccess - Macintosh Release: 1.6v0
Lines: 61

This is a repost.

From: pulse@mcs.net (pulse)
Newsgroups: comp.admin.policy,news.admin.policy
Subject: Re: (Document)What's the scoop on GIF legality?
Date: 3 Jan 1995 20:41:37 GMT

This is from a post on comp.graphics, by a Netscape employee:


          ==================  qoute  ==================


The following just recently showed up in the GRAPHSUPPORT forum on 
compuserve.

All you GIF developers read up:

COMPUSERVE ANNOUNCES GIF DEVELOPER LICENSE PROGRAM

On May 28th, 1987, CompuServe introduced the Graphics Interchange Format 
(GIF) specification, subsequently revising the specification on August 8, 
1990. Since that time, CompuServe has worked extensively with developers 
to license GIF and make it the worldwide graphics standard that it 
currently is. GIF uses LZW compression and decompression methods that 
CompuServe originally thought to be public domain. However, Unisys 
Corporation claims patent rights to the LZW algorithm and compression 
process. This has caused some confusion as to whether developers need to 
license LZW from Unisys.

CompuServe recently negotiated and secured a patent license for LZW 
technology from Unisys. Through this license, CompuServe is able to 
provide a sub-license to GIF developers. This CompuServe GIF license 
agreement grants the developer lawful use of GIF and the LZW algorithm 
for certain uses. This relieves licensees from the obligation to license 
LZW directly from Unisys and extends to them other benefits of the terms 
negotiated by CompuServe. The CompuServe GIF license is based upon terms 
established with Unisys by CompuServe. This includes a requirement that 
the developer's software be used primarily with the CompuServe 
Information Service or use information obtained through the CompuServe 
Information Service. This license is subject to a reasonable royalty.

GIF developers who register prior to January 10, 1995 can obtain the 
benefit of a clause in the CompuServe-Unisys agreement that states that 
Unisys will not pursue royalty claims for past use of LZW. The CompuServe 
GIF developer agreement, including compliance requirements, is available 
on the CompuServe Information Service in the Standards and Spec's section 
of the Graphics Support Forum. A new specification will be finalized 
which will become a part of the license agreement.

Additional information and hard copies of the agreement can be obtained 
by contacting Larry Wood of Go Graphics at CIS ID# 76703,704, or by phone 
at 407-658-2687.


               ================  end quote  ====================


-
/* pulse (lu-zer) adj. feelings of nausea, vomit, a puking sensation */

                                                   
================================================================================
To:   ALL                        Number:  1837   
From: ED@TITIPU.RESUN.COM (EDWA  Refer #: None      (Echo)
Date: 01-10-95 21:49             Recvd:   No
Subj: Repost: CompuServe commen  Conf:    2333 comp.sys.unisys
BBS:  Rose Media Incorporated.
--------------------------------------------------------------------------------

From: ed@titipu.resun.com (Edward Reid)
Newsgroups: comp.sys.unisys
Subject: Repost: CompuServe comments on GIF licensing
Date: Sat, 7 Jan 95 13:54:53 EST(-0500)
Organization: Paleolithic Refugia
Message-ID: <01010064.j8jddo@titipu.resun.com>
X-Gated-By: Usenet <==> RoseMail Gateway (v1.70)
Reply-To: ed%blkhole@sdd.hp.com
X-Mailer: uAccess - Macintosh Release: 1.6v0
Lines: 63

This is a repost.

From: pulse@mcs.net (pulse)
Newsgroups: comp.graphics,alt.wired,news.admin.policy,misc.legal
Subject: Re: PROTEST OF NEW COMPUSERVE-UNISYS GIF USAGE TAX !!
Date: 4 Jan 1995 09:32:05 GMT

<from comp.infosystems.www.providers>
<tim oren speaking for compuserve>

Good evening.  Someone from CompuServe is watching, and I hope I can
clear up a few things.  I'm Vice President of Future Technology at 
CompuServe.  I'm involved in this because the inventor of GIF 
currently works for me.  Jon Shemitz (jon@armory.com) who posted 
earlier in this thread, can authenticate me.  [Jon:  Your first born
is named Samuel Dashiell, and we first met on Stuart II.]

First, some clarifications:

1.  CompuServe is not asserting proprietary rights in the GIF spec. 
As pointed out earlier in the thread, this has long been publicly 
available.

2.  GIF was originally developed using the LZW algorithm which was 
found in the open literature, and which was not know to us to be a 
subject of patent filing at that point.  We found this out, to our 
displeasure, after the GIF spec was widely disseminated and used.

3.  CompuServe at that point found it necessary to take a license to
the patent.  Since a number of our developers had used GIF in good 
faith, we also negotiated a pass through license for their benefit. 
Parts of this license, with a poor interpretation, have been widely 
distributed outside of their original context, which was to 
developers of CompuServe related products alone.  GIF is included in
this license because we are unable to pass through a general license
to practice LZW.

4.  It is not the intent of CompuServe to attempt to enforce 
proprietary rights in GIF against users or developers, including 
those of Web technology.  As sponsors of CommerceNet and new 
entrants to the Internet access business, we intend to assist in the
development of the Web, not to sabotage it.  We cannot and do not 
speak for Unisys' intent in this matter.

Second, please don't mailbomb Sam or the postmaster or webmaster.  
They have enough work to do without having to write mail 'bots.  
We're watching this news group and others, and will be interested in
creative comments on how we can be respond to the situation, 
considering the legal constraint we've been placed under.  Please 
think about how we can add some benefits for our end users if we 
find it necessary to put them through a standards transition.

Finally, there will be a more formal statement along shortly.

Tim Oren
CompuServe, Inc.
70004.4003@compuserve.com

Non-disclaimer:  I do speak for the company.
-
/* pulse (lu-zer) adj. feelings of nausea, vomit, a puking sensation */


            
================================================================================
To:   ALL                        Number:  1834   
From: ED@TITIPU.RESUN.COM (EDWA  Refer #: None      (Echo)
Date: 01-10-95 21:49             Recvd:   No
Subj: Repost: CompuServe GIF li  Conf:    2333 comp.sys.unisys
BBS:  Rose Media Incorporated.
--------------------------------------------------------------------------------

From: ed@titipu.resun.com (Edward Reid)
Newsgroups: comp.sys.unisys
Subject: Repost: CompuServe GIF license text
Date: Sat, 7 Jan 95 13:53:32 EST(-0500)
Organization: Paleolithic Refugia
Message-ID: <01010064.j8jarl@titipu.resun.com>
X-Gated-By: Usenet <==> RoseMail Gateway (v1.70)
Reply-To: ed%blkhole@sdd.hp.com
X-Mailer: uAccess - Macintosh Release: 1.6v0
Lines: 300

This is a repost, complete with the misspelling "Unysis".

From: pulse@mcs.net (pulse)
Newsgroups: comp.admin.policy,news.admin.policy
Subject: Re: What's the scoop on GIF legality?
Date: 3 Jan 1995 21:07:29 GMT

<This is from comp.graphics>

-------------------------------------------------------------------------------------------------

Here is the text of the CIS license:

AGREEMENT FOR USE OF GRAPHICS INTERCHANGE FORMAT(SM)


This Agreement is entered into as of the effective date set forth below 
between CompuServe Incorporated, an Ohio corporation ("CompuServe"), and the 
other undersigned party to this Agreement ("Developer").

Section 1.  Grant of Rights.  

1.1.  Effective upon Developer's payment of the initial license fee 
described in Section 2, CompuServe hereby grants to Developer a non-exclusive,
worldwide: (a) license to use and exploit GIF(SM) to make, have made, use and 
sell Products solely within the Field of Use; and (b) sublicense to use and 
exploit the Licensed Patent to make, have made, use and sell Products solely 
within the Field of Use.

1.2.  CompuServe will provide Developer with a single copy of the most 
recent specification for GIF(SM) and any updates to such specification that 
are released by CompuServe during the term of this Agreement.  Once an updated
version of the GIF(SM) specification has been released by CompuServe, 
Developer should incorporate the updates contained in the new specification 
into its Products as part of Developer's ordinary release cycle.

1.3.  Developer understands that CompuServe and Unysis Corporation are the 
owners of all patents, copyrights, service marks and other intellectual 
property embodied in the Licensed Technology. In connection with its use of 
the Licensed Technology, Developer shall  take all steps reasonably required 
by CompuServe and/or Unysis Corporation to acknowledge and protect their 
respective ownership interests in the patents, copyrights, service marks and 
other intellectual property interests embodied in the Licensed Technology.  
Developer further agrees not to take any action that would impair the 
respective interests of CompuServe and/or Unysis Corporation in the Licensed 
Technology.

1.4.  Developer may not use, copy, modify or distribute the GIF(SM) 
specification, except as expressly permitted by CompuServe.  Developer may 
make three copies of the GIF(SM) specification for back-up purposes only, 
provided CompuServe's service mark, copyright and other notices and legends 
are included in such copy.  Developer shall not alter or delete any of the 
notices or legends contained in the GIFSM specification and any updates 
thereto.  Developer agrees to provide the following notice on Products or in 
any Product documentation:  "LZW compression and decompression methods are 
licensed under Unysis Corporation's U.S. Patent 4,558,302 and equivalent 
foreign patents.  Additional technology embodied in GIF(SM) is licensed from 
CompuServe Incorporated.  Graphics Interchange Format and GIF are service 
marks of CompuServe Incorporated."

1.5.  Developer shall not grant any customer the right to use a Product 
until such customer has been registered by Developer as a user of the Product 
and customer's rights to use such Product are governed by an agreement with 
Developer providing that (a) the customer's use of such Product will be 
primarily for accessing the CompuServe Information Service and for 
manipulating and viewing data received through the CompuServe Information 
Service, and (b) the customer will not alter, enhance or redistribute any 
Product.

1.6.  This Agreement does not provide Developer with title to or ownership 
of the Licensed Technology or any service mark of CompuServe, but only the 
license granted herein.  Developer may only grant its customers a limited 
right to use Products.

Section 2.  License Fees.

2.1.  In payment for the licenses granted herein, Developer shall pay 
CompuServe a one-time initial license fee of $ 1.00 which is due in full upon 
the execution of this Agreement and a fee per Disposition equal to the 
greater of (a) 1.5 percent of the selling price per Disposition or (b) $.15 
per Disposition.  Unless otherwise provided herein, all license fees and 
other amounts payable hereunder by Developer shall be paid to CompuServe in 
U.S. Dollars within ten (10) days after the end of each quarter.  Quarterly 
periods may be defined at CompuServe's discretion.

2.2.  Developer is solely responsible for payment of any taxes resulting 
>from Developer's use of the Licensed Technology, except for taxes based on 
the income of CompuServe or Unysis Corporation.  Developer agrees to hold 
CompuServe harmless from all claims and liability arising from Developer's 
failure to report or pay such taxes.  This paragraph shall survive any 
termination of this Agreement.

Section 3.  New Products.  

Developer shall have the right to add additional Products solely within the 
Field of Use by providing notice to CompuServe of the existence of each new 
Product at the time such new Product is first offered to Developer's customers.

Section 4.  Reports.  

Developer shall keep adequate records to accurately determine the payments 
due under this Agreement.  Each payment hereunder shall be made and 
accompanied by a report in such manner and form as requested by CompuServe 
setting forth the number of Dispositions of each Product occurring hereunder 
and any other information reasonably necessary to calculate payments due 
hereunder.  Developer shall not enter into any arrangement under which copies 
of Products will be prepared or the Licensed Technology used, unless 
Developer has taken steps to ensure that it can account for and pay the 
royalties required hereunder.

Section 5.  Audits.  

CompuServe shall have the right, no more than once during any calendar year, 
to have an independent certified public accountant inspect the relevant 
records of Developer on seven business days notice and during regular 
business hours to verify the reports and payments required to be made 
hereunder.  Should an underpayment in excess of 10 percent be discovered, 
Developer shall pay the cost of the audit.  In any event, Developer shall 
promptly pay any underpayment together with interest at the annual rate of 12 
percent.

Section 6.  Assignment.  

This Agreement and the licenses granted herein may not be assigned by 
Developer without the prior written consent of CompuServe.

Section 7.  License Term.  

The initial term of this Agreement shall commence on the effective date of 
this Agreement and shall expire at midnight (EST) on the first anniversary of 
such date.  This Agreement shall automatically renew for additional 
consecutive one year periods, unless either party delivers a written notice 
of termination to the other party not later than 30 days before the 
expiration of the then current term.

Section 8.  Termination for Cause.  

This Agreement may be terminated by CompuServe: (a) upon 30 days prior 
written notice, if Developer is in breach of any of its material obligations 
hereunder and the breach is not remedied within such 30 day period; or (b) 
upon reasonable written notice, if the Licensed Patent expires or is found 
invalid or unenforceable in any proceeding before the U.S. Patent and 
Trademark Office or in a U.S. court of law, after all appropriate appeals 
have been finally decided.  Promptly following any termination of this 
Agreement, Developer shall (i) return all copies of the GIF(SM) specification 
and any confidential information of CompuServe then in its possession or 
control to CompuServe, (ii) stop using the Licensed Technology, and (iii) 
stop distributing  Products.

Section 9.  Notices.  

All notices or other communications required or permitted under this Agreement
shall be in writing and shall be delivered by personal delivery, registered 
mail return receipt requested, a "Next Day Air" delivery service or by 
customary electronic means, addressed as indicated on the signature page of 
this Agreement.

Section 10.  Miscellaneous.

10.1. CompuServe represents that it has executed an agreement with Unysis 
Corporation dated June 21, 1994, pursuant to which Unisys Corporation (a) 
granted to CompuServe a license to sublicense the technology covered by the 
Licensed Patent to make, have made, use and sell Products in the Field of 
Use, provided such Products are identified to Unysis Corporation as required 
by such agreement, and (b) agreed as follows: "Unysis hereby releases any and 
all claims of any nature based upon any use of the technology of the Licensed 
Patent by Licensee in the Products, internal use in offering the CompuServe 
Information Service, or use by its licensees in derivatives of the Products, 
which have occurred to date and during the period of implementation of this 
Agreement, provided that Licensee shall exercise commercially diligent 
efforts to implement this Agreement as soon as reasonably practicable and in 
no case later than six (6) months after the date this Agreement is executed 
by Licensee." 

10.2. EXCEPT AS SET FORTH IN THIS AGREEMENT, COMPUSERVE DISCLAIMS ANY AND 
ALL EXPRESS AND IMPLIED PROMISES, REPRESENTATIONS AND WARRANTIES WITH RESPECT
TO THE LICENSED TECHNOLOGY, INCLUDING ITS CONFORMITY TO ANY REPRESENTATION OR 
DESCRIPTION, THE EXISTENCE OF ANY LATENT OR PATENT DEFECTS, OR ITS 
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.  This paragraph shall 
survive any termination of this Agreement.

10.3.  The cumulative liability of CompuServe for all claims arising out of 
or relating to this Agreement shall not exceed the total amount of all 
license fees paid to CompuServe hereunder.  In no event shall CompuServe be 
liable for any lost profits or incidental, special, exemplary or consequential
damages for any claims arising out of or relating to this Agreement.  This 
paragraph shall survive any termination of this Agreement.

10.4. Nothing in this Agreement shall be construed as:  (a) requiring the 
maintenance of the Licensed Technology; (b) a warranty as to the validity or 
scope of the Licensed Technology; (c) a warranty or representation that any 
Product will be free from infringement of patents, copyrights, trademarks or 
other similar intellectual property interests of third parties; (d) an 
agreement to bring or prosecute actions against third party infringers of the 
Licensed Technology; (e) conferring any license or right under any patent 
other than the Licensed Patent; or (f) conferring any right to use the 
Licensed Technology outside the Field of Use.

10.5. This Agreement contains the complete and final agreement between the 
parties, and supersedes all previous understandings related to the subject 
matter hereof whether oral or written.  This Agreement may only be modified 
by a written agreement signed by duly authorized representatives of the 
parties.

10.6. The validity and interpretation of this Agreement shall be governed 
by Ohio law, without regard to conflict of laws principles.  The parties 
further consent to the exclusive jurisdiction of the state and federal courts 
located in the City of Columbus, Ohio.  Process may be served on either party 
by U.S. Mail, postage prepaid, certified or registered, return receipt 
requested, and addressed as indicated on the signature page of this Agreement.  
This paragraph shall survive any termination of this Agreement.

10.7. Developer shall not disclose to anyone for any reason the terms of 
this Agreement or any information provided to Developer by CompuServe that is 
marked as being confidential information of CompuServe, except with 
CompuServe's prior written consent.  Developer shall protect the 
confidentiality of such information with at least the same degree of care it 
employs to protect its own similar confidential information.  Developer may 
use such confidential information of CompuServe solely for purposes of 
exercising its rights under this Agreement, and shall make no other use of 
such information.  This paragraph shall survive any termination of this 
Agreement.

10.8. Developer acknowledges and agrees that Unisys Corporation is an 
intended third party beneficiary of each and every provision of this 
Agreement, other than Section 2 hereof, and may enforce any rights it may 
have under such provisions to the fullest extent permitted by law as if it 
were a party to this Agreement.  This paragraph shall survive any termination 
of this Agreement.

10.9. Developer shall indemnify and hold CompuServe, and its officers, 
directors, agents, employees and affiliates, harmless against any damage, 
loss, claim, action, liability, cost or expense suffered by or brought against
any of the foregoing indemnified parties arising out of or relating to any 
breach or violation of this Agreement by Developer or its customers or any 
conduct of Developer or its customers relating to their use of the Licensed 
Technology.  This paragraph shall survive any termination of this Agreement.

Section 11.  Definitions.  As used herein:

11.1. "Disposition" means the sale, lease or license or any other grant of 
rights to a Product or any new Product as may be added pursuant to Section 3 
of this Agreement.

11.2. "Field of Use" means software provided by CompuServe or Developer and 
used by subscribers to the CompuServe Information Service to access the 
CompuServe Information Service or use information obtained over the 
CompuServe Information Service which utilizes the technology of the Licensed 
Patent.

11.3. "GIF(SM)" means CompuServe's copyright and other intellectual property
embodied in the Graphics Interchange Format(SM) as described in the most 
recent release of the specification for the Graphics Interchange Format(SM), 
as the same may be updated from time to time during the term of this Agreement,
but (for purposes of this Agreement) does not include the technology covered 
by the Licensed Patent or CompuServe's service marks for the Graphics 
Interchange Format or GIF.

11.4. "Licensed Patent" means U.S. Patent 4,558,302 registered in the name 
of Unisys Corporation relating to digital data compression and decompression, 
and all foreign counterparts.

11.5. "Licensed Technology" means, collectively, GIF(SM) and the Licensed 
Patent.

11.6. "Products" means software that is developed or distributed under this 
Agreement which is designed for and used primarily for accessing the 
CompuServe Information Service and for manipulating and viewing data received 
through the CompuServe Information Service,  and any new Products as may be 
added pursuant to Section 3 of this Agreement.

Signatures:


CompuServe Incorporated Developer


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To:   ALL                        Number:  1826   
From: PEREW@KAIWAN009.KAIWAN.CO  Refer #: None      (Echo)
Date: 01-10-95 04:15             Recvd:   No
Subj: Unisys Clarifies LZW Poli  Conf:    2333 comp.sys.unisys
BBS:  Rose Media Incorporated.
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From: perew@kaiwan009.kaiwan.com (Mark Perew)
Newsgroups: comp.sys.unisys
Subject: Unisys Clarifies LZW Policy
Date: 6 Jan 1995 12:38:13 -0800
Organization: Chaos isn't just a theory.  It's a way of life.
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[ Article crossposted from comp.graphics,alt.online-service.compuserve,comp.compression,comp.infosystems.www.providers,comp.infosystems.www.users,comp.infosystems.www.misc,alt.gif-agreement ]
[ Author was Jim Gillogly (jim@acm.org) ]
[ Posted on 6 Jan 1995 11:42:24 -0800 ]


                                             January 6, 1995

Unisys Clarifies Policy Regarding Patent Use in On-Line Service Offerings

The concerns, inquiries and some apparent confusion that have resulted from 
the December CompuServe advisory clearly indicate that we need to clarify 
our policy concerning the use of the Unisys Lempel-Ziv-Welch (LZW) patent by
software developers for the major on-line services.

We want to reiterate earlier communications that the issue of patent 
licenses is not focused on the end users of on-line networks, including the 
Internet.  We encourage end users to continue to take full advantage of the 
outstanding benefits of a rapidly growing on-line community.

Unisys was awarded the patent in 1985.  We became aware of the increasing 
interest in our LZW patent beginning in 1990 when many companies approached 
us to license the patent for their hardware and software products.  The 
growth in the use of compression technology was mushrooming in order to meet 
the demands for transmitting increased amounts of data.  To date, more than 
100 companies, including hardware, software and on-line information 
services, have licensed the Unisys LZW technology.

Two years ago, Unisys learned that the LZW method was incorporated in the 
GIF specification and immediately began negotiations with CompuServe in 
January of 1993.  We reached agreement with CompuServe on licensing the 
technology in June 1994, which calls for CompuServe to pay Unisys a royalty 
of 1% of the average selling price it charges for its software.  This 
represents approximately 11 cents for each copy sold and connected to its 
information service.

Under the agreement, CompuServe, at its discretion, could relicense the LZW 
technology to commercial developers using the GIF specification in software 
that connected directly to the CompuServe information service.

With the agreement completed on June 21, 1994, CompuServe was given six 
months to implement the terms of its license.  CompuServe later asked for a 
one-month extension, which we granted.

Unisys did not require CompuServe to pass on any fee to its sublicensees or 
end users.  Such a decision, and the content and timing of CompuServe s 
advisory, was at their discretion.

Consistent with the entire information industry's desire to protect
intellectual property, Unisys will expect all of the major commercial 
on-line information services companies employing the LZW patent to license 
the technology from Unisys at a reasonable rate.  The on-line service 
companies are not required to sublicense the technology to developers 
producing software for the commercial on-line services. It will be, as it is 
today, at the on-line service's discretion as to whether it charges a
license fee to developers or chooses an alternative method to account for 
its licensing fees payable to Unisys.

We recognize and are concerned --  thanks in large part to the recent and 
very active use of the on-line network -- that developers did not understand 
that the patented technology was resident in GIF.  Taking that into account, 
Unisys does not intend to pursue previous inadvertent infringement by 
versions of GIF-based software products marketed prior to 1995.

Concerning all future software product development and enhancement of 
existing products for accessing on-line services, Unisys expects developers 
of commercial, for-profit software to secure a license from Unisys, or 
through the licensed on-line service, for the use of the patented 
technology.  The very reasonable terms should prove no financial barrier to 
the introduction of product into the on-line network.

Unisys does not require licensing, or fees to be paid, for non-commercial, 
non-profit GIF-based applications, including those for use on the on-line 
services.

Concerning developers of software for the Internet network, the same 
principle applies.  Unisys will not pursue previous inadvertent infringement 
by developers producing versions of software products for the Internet prior 
to 1995. The company does not require licensing, or fees to be paid for 
non-commercial, non-profit offerings on the Internet, including  Freeware . 

Commercial developers of GIF-based software for the Internet are expected to 
secure a licensing agreement with Unisys for software products introduced 
beginning in 1995, or enhancements of products that were introduced prior to 
1995.  Again, terms should not preclude the entry by these firms into the 
marketplace.

For organizations introducing World Wide Web servers and  Home Page  
offerings, most will not be required to secure a license from Unisys.  Most 
organizations acquire software from other developers to create their 
offerings on their servers.  Therefore, only the software firms who sell the 
enabling software for profit would be expected to secure a licensing 
agreement from Unisys.

Unisys understands that this issue has caused concern.  We want to reassure 
all users and developers that we are strong proponents of the on-line 
industry.

We're proud that this important Unisys technology has played a role in the
introduction of innovative products and services, many of which are fueling 
the explosive growth of the information superhighway.

As members of the information community we want to strike the appropriate 
balance between information access and the rights of all information 
companies, including the developers of software, to protect their 
intellectual property rights.

Patent information:  Contact Welch Patent Licensing Department; Unisys; Mail 
Stop C1SW19; P.O. Box 500, Blue Bell, PA 19424.

Or via Internet, send E-mail to LZW_INFO@UNISYS.COM, or use a form available 
on the Home Page of the Unisys Web Server (http:\\www.unisys.com) to request 
follow-up information.


Media contacts: Unisys Public Relations -- Bob O'Leary     (215) 986-6413
                            or Oliver Picher (215) 986-5367
___________________________________________________________________________

Non-Unisys statement:  I received this from a friend at Unisys, but am not
a Unisys person myself.  Please follow up either in these newsgroups or to
the official Unisys contacts listed above.

Forwarded by:
-- 
	Jim Gillogly
	15 Afteryule S.R. 1995, 19:42
                                                                        
