AWS forced to pay out millions in major patent dispute

Patent holder will receive $30.5 million from AWS after infringements

News By Ellen Jennings-Trace published 1 October 2024

A US jury has ruled Amazon Web Services (AWS) willingly infringed on two patents, and must now pay $30.5 million for violating the patent owner's rights in computer networking and broadcasting technology.

The offending technologies were AWS’s Cloudfront content delivery network and Virtual Private Cloud virtual network - which infringed on the patents originally owned by Boeing, but obtained by Acceleration Bay.

The two patents in this case are said to involve methods of streamlining data delivery across a network. Without getting too technical, the technologies allow data to be sent from peer to peer and flow around slow or broken connections by forming a network.

Assertion entity

Acceleration Bay describes itself as an ‘Incubator & Investor’, and recently won a separate patent trial against Activision, in which the video game developer was ordered to pay $23.4 million.

The final court’s judgement in the AWS case will come soon, but the payout could yet triple, due to the fact that Amazon 'willfully' breached the patents. AWS cloud services reportedly brings in around $9 billion operating profit per quarter - which is around 62% of Amazon’s total, so it probably won’t be hit too hard by the charges.

This isn’t the first time AWS has faced opposition with patented technology, having had to pay $525 million in damages earlier in 2024 after losing a cloud storage patent case.

The tech giant has also had a long-running spat with Nokia, with both firms bringing forward patent lawsuits against each other in recent years - most recently, in August 2024, AWS accused Nokia of over a dozen infringements for cloud computing technologies.

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