The Limits of "Authorized" Innovation: Settling the DPR Dilemma

Last month’s stalemate between iBiquity Digital Corporation, the proprietor of HD Radio, and upstart-innovator Digital PowerRadio appears to have been broken.
For those just tuning in: DPR claims to have invented a process that can make HD receivers much more sensitive, allowing for better reception of digital radio signals. iBiquity asserts that DPR’s method is outdated and meaningless. Since iBiquity owns all aspects of HD Radio, it also controls the code necessary to verify or debunk DPR’s claims.
At the annual convention of the National Association of Broadcasters last month, the NAB’s Chief Technology Officer served as an intermediary to get iBiquity and DPR talking. Since then, iBiquity has softened its stance, inviting DPR’s principals to its Maryland headquarters "sometime in May."
This is not the first time iBiquity has had outside innovators over for a chat. Radio World reports that "The company frequently vets ideas to improve the system, both from inside and outside the company….Typically what’s proposed is not cost-effective, won’t work with its technology or both."
In a nutshell, that explains the lack of consistent and sustained innovation in the HD Radio space. You’ve gotta pay to play, and even then the system developer has final say about whether or not your innovation is "viable." That determination pretty much comes down to how easily iBiquity can assimilate your intellectual property into its own. Since its business model depends on keeping full control over HD Radio’s source code, outsiders like DPR represent the worst kind of trouble.
In many cases like these, when an outside innovator’s work seems really promising, they’ll be acquired outright by a system’s proprietor. That’s unlikely in the case of DPR. iBiquity doesn’t have the financial wherewithal to acquire other companies, and DPR’s technology has multiple potential uses across different wireless networks; why limit its market to radio broadcasting by assimilation into iBiquity?
At this point, iBiquity is committed to seeing DPR’s claims through. That’s the reason for the meeting at company HQ: loath to disclose any of HD Radio’s source code, iBiquity will administer DPR’s testing regime. If the results are positive, that puts iBiquity in a difficult position where the "black box" around HD technology may need to be breached in order to make a substantive improvement in it. That may be especially problematic for iBiquity because it involves the receiver-side of its business – the licensing of which right now accounts for nearly all of the company’s revenue.
Given the tenuous state of HD Radio’s proliferation, it seems silly to dally on such potential. But it’s pretty much par for the course for a technology born of fear and hubris.