Southwestern Germany, Baden-Württemberg, Fraunhofer Gesellschaft Research Institute.
Dr. Dieter Genscher, a middle-aged man with blonde hair and a beard, paced anxiously around the laboratory in a white lab coat.
He repeatedly stopped to check the watch on his wrist before resuming his restless movements.
A young researcher, who had been sitting to the side with a tense expression, could no longer bear to watch and cautiously spoke up.
"Doctor, it seems unlikely that we'll get any results today. Why don't you head home?"
"Hmm… There's a chance we might receive a call later. I'll wait a little longer."
"I'll stay in the lab, and if a call comes in, I'll notify you immediately."
It was already late afternoon, and even to the young researcher, the chances of receiving a call today seemed slim. However, Dr. Genscher, unable to let go of hope, glanced at his watch once more.
"I'll stay for another 30 minutes."
"Alright."
Dr. Genscher stopped pacing and tried to calm himself.
Perhaps smoking a cigarette while sitting down would help ease his nerves.
Just as he pulled out his cigarette pack from his coat pocket, the phone suddenly rang loudly.
Ring! Ring!
The researcher stood up to answer, but Dr. Genscher, moving even faster, grabbed the receiver and immediately spoke.
"Hello."
[Is this the Fraunhofer Research Institute?]
"Yes, it is."
[May I speak with Dr. Dieter Genscher?]
"This is Genscher speaking."
[Ah, I see. I'm Josef, the IEEE Section 3 Coordinator.]
At the mention of IEEE, Dr. Genscher swallowed nervously while holding the receiver.
The Institute of Electrical and Electronics Engineers (IEEE) was an international organization that established and published standards for electrical and electronic technologies.
Dr. Genscher and his colleagues had submitted their long-researched digital music recording method for standardization, and today, the results had finally arrived.
[Congratulations! Your submitted digital music recording method has been officially accepted as a technical standard, and it will be named MP3.]
"Is that true?"
Dr. Genscher, his face filled with disbelief, asked again.
The caller responded with a laugh.
[Yes, that's correct. The official documents will be sent to you via fax shortly.]
"Thank you!"
Dr. Genscher answered, his face flushed with excitement.
Seeing this, the young researcher, who had been watching anxiously, realized that the standard had been approved and silently clenched his fist in triumph.
[The decision will also be officially published in the next bulletin along with the materials you submitted. If you have any questions, please feel free to contact the association anytime.]
"Yes, of course."
As soon as Dr. Genscher placed the receiver down, the researcher, unable to contain himself, asked eagerly.
"Doctor! It's been approved as a standard, hasn't it?"
"Yes. The committee just confirmed their decision."
"Congratulations!"
Dr. Genscher, filled with emotion, patted the researcher on the shoulder.
"You've worked hard, too."
After sharing this moment of joy, Dr. Genscher suddenly snapped back to reality.
"We can't just stand around—we need to inform the others."
"You should! Everyone must be waiting for the news."
"I'm sure they are."
Picking up the receiver again, Dr. Genscher made his first call to Professor Georg at the University of Erlangen, his mentor and a key contributor to the technology's development.
***
Closing the signed approval documents, Seok-won handed them back to Na Seong-mi, who was standing in front of his desk.
"Could you bring me a cup of coffee?"
"Yes, Director."
After taking the documents and leaving the room, Na Seong-mi exited, leaving Seok-won alone. He turned to his computer to check the stock market trends.
With additional foreign capital flowing in, the stock market, which had rebounded successfully, continued its upward trend, rising by about 10 points today.
As Seok-won reviewed the stock movements of key investments made by the PI department, the vibration of his phone on the side of his desk caught his attention.
Picking up the phone, he answered the call and heard a familiar voice—Landon.
[Boss, it's me.]
"What brings you to call at this hour?"
[I have some good news.]
Just then, a knock sounded at the door, and Na Seong-mi entered, placing a steaming cup of coffee in front of him, filling the room with its rich aroma.
As Seok-won kept the phone to his ear, he gave her a slight nod of appreciation. Na Seong-mi smiled in response and quietly exited the room.
Leaning back comfortably in his chair, Seok-won adjusted his grip on the phone and spoke.
"Tell me what it is."
[Among the patents we acquired from the French company Thomson, the digital audio compression technology has been officially adopted as an IEEE standard.]
Having eagerly awaited this news, Seok-won's face lit up as he straightened his posture.
"Is that true?"
[Yes. Dr. Genscher from Germany personally delivered the news, and we also received an official document from IEEE confirming the adoption.]
"That's great news."
[Oh, and they've decided to name the standardized technology MP3.]
"That's simple and easy to say. I like it."
At this moment, no one knew, but the technology that would soon revolutionize digital music had just received international recognition, marking a historic milestone.
'And along with that, I've just secured a honey pot that will effortlessly bring in hundreds of millions of dollars every year.'
Since he held the original technology patent, anyone wanting to use MP3 in their products would have to pay him licensing fees.
'At its peak, Apple's iPod sold well over 50 million units a year.'
Even if he collected just $5 per device in royalties, that would amount to over $250 million.
And that wasn't even counting the licensing fees from other MP3 player manufacturers, which would push the total even higher.
'Not to mention that in a few years, smartphones will come with MP3 functionality as a standard feature. This is a goldmine.'
Thinking about the immense patent royalties he would collect, he felt satisfied even while sitting still.
"MP3 patent rights are fully owned by Thoth, correct?"
Named after the Egyptian god of wisdom, Thoth was a patent-specialized company that Seok-won had founded.
[Of course. Thomson funded the research under the condition that we would retain full ownership of the patent. Since we inherited the contract as it was, MP3 patents belong entirely to Thoth.]
"That's excellent."
With a pleased smile on his lips, Seok-won continued.
"Pass along my thanks to Dr. Genscher and the entire research team for their hard work. Make sure to give them generous bonuses."
[How much should we pay them?]
After a brief moment of thought, Seok-won replied.
"Give Dr. Genscher and the key researchers $1 million each. As for the rest of the contributors, make sure they don't go unnoticed—give them each $100,000."
Landon, seemingly caught off guard by the unexpectedly large amount, asked again.
[That much?]
"They worked hard and delivered results. It's only fair they're rewarded accordingly."
Truthfully, he wanted to give them even more, but since MP3's true value had yet to be recognized, this seemed like the right amount for now.
'In the original course of history, MP3 technology was developed, standardized internationally, and yet, aside from research funding, there was no real reward for their efforts.'
Knowing how indispensable MP3 would become in the future, that outcome felt far too inadequate.
[That makes sense, but isn't this a bit excessive for a technology that's not considered highly valuable?]
Landon hesitated as he voiced his concern.
The price paid to acquire MP3 rights from France's Thomson was $1 million, so it was understandable that Landon was taken aback when asked to distribute bonuses that far exceeded that amount.
"It may seem that way now, but soon, this will be a goose that lays golden eggs."
[…]
Seok-won was full of confidence, but Landon remained skeptical about whether things would truly play out that way.
However, since Seok-won was the ultimate decision-maker—and considering that even handing out millions in bonuses wouldn't make a dent in his rapidly growing personal wealth—Landon chose to follow orders without further protest.
'Just the value of his Netscape shares alone, which recently underwent a stock split due to soaring prices, is nearing $1 billion—there's really nothing more to say.'
With the internet boom showing no signs of slowing down and instead burning even hotter, Netscape's stock had surged past $100 per share.
As a result, its founder, Tom Harper, accepted Seok-won's suggestion and decided to split each share into two, as the stock had become too expensive.
The news of the stock split thrilled investors, further fueling Netscape's bullish momentum.
[Understood. I'll proceed with the bonus payments as instructed.]
"Oh, and make sure we don't just hold the core MP3 technology—we need to secure all surrounding and related patents as well."
[How far should we extend the acquisition scope?]
"If it's even remotely related, don't leave anything out. Buy everything."
[That will result in a significant number of patents being acquired.]
"Whether it's ten or a hundred, it doesn't matter. Buy them all."
With the increasing adoption of MP3 technology, it was only a matter of time before so-called "patent trolls" would emerge—entities that aimed to profit by demanding licensing fees for holding related patents.
'No way am I letting someone else dip their spoon into the honey jar I marked first.'
If Seok-won secured not only the core technology but also the surrounding technologies, patent trolls wouldn't dare to stake a claim on MP3.
'On top of that, having all the related patents would give me the upper hand in negotiations with companies wanting to use MP3 technology.'
No matter what approach they took, avoiding Seok-won's patents would be nearly impossible, ensuring that he remained in a position of absolute power.
[Understood. Also, I have one more thing to report.]
"Go ahead."
[We've finalized the acquisition price with Blizzard's management.]
Seok-won's eyes gleamed with interest as he asked,
"How much?"
[Including $10 million in debt, we are acquiring 100% of the shares for a total of $23 million.]
Considering that Blizzard was still a small game studio without a major hit title, it was quite a high valuation.
However, knowing that blockbuster games like Diablo were just around the corner, Seok-won gave his order without hesitation.
"That's a reasonable price. Proceed with the deal."
Landon, well aware of Seok-won's determination to acquire Blizzard, wondered if they were overpaying but simply nodded without argument.
[Understood. I'll take care of it as instructed.]
After exchanging a few more words, Seok-won ended the call and took a sip of the now lukewarm coffee in front of him.
A smile of anticipation spread across his face as he muttered to himself,
"Now that we've acquired Blizzard, I might finally get to play the nearly completed Diablo beta version."
TL/n -
Apple, like other companies that used MP3 technology, had to pay licensing fees to Fraunhofer Institute and other patent holders. The standard MP3 licensing fee was $0.75 per device that could encode MP3s and $0.50 per device that could only decode MP3s.
Since Apple didn't buy the MP3 patent outright but instead paid ongoing royalties, the total amount they paid over the years isn't publicly disclosed. However, considering the millions of iPods and other MP3-capable devices they sold, they likely paid tens or even hundreds of millions of dollars in MP3 licensing fees.