Immersion, a company specializing in haptic feedback technology, has settled a lawsuit with Meta over the use of the latest haptic feedback in its Quest VR headset.
In a Press release, Immersion said it had signed a license with Meta to make Immersion’s patents available to Meta and its affiliates’ hardware, software, virtual reality and gaming products. Terms of the deal were not disclosed.
“We are pleased to grant Meta a license to our patents for haptic technologies,” Immersion president and CEO Eric Singer said in a canned statement. “We’re excited to license Meta to deliver high-quality haptics to their devices.”
Based in Aventura, Florida and founded in 1993, Immersion’s first major customer was Microsoft, with whom the startup partnered to integrate its haptic feedback and touch technology into Microsoft’s DirectX APIs. After acquiring a portfolio of tangible patents from Cybernet Systems, a small technology company, in 1999, Immersion went public on the NASDAQ.
In the years since its IPO, Immersion has gained a reputation as a patent troll, using targeted mergers to acquire the rights to more than a thousand haptic feedback patents. As of 2014, Immersion had more than 1,650 issued or pending haptic patents in the U.S. and other countries — a number that will decrease to about 1,200 to 1,300 by the end of June 2022.
Some of Immersion’s patents are of questionable legality as of 2018 Position in the Electronic Frontier Foundation’s blog spotlight. One, “Virtual Reality Interactive Theater Entertainment System,” covers minor modifications to existing VR systems, such as having players watch pre-recorded videos — even though those modifications were not new in the patent filing.
Immersion filed a lawsuit against Microsoft and Sony in 2002, claiming that their game console controls infringed on two of its patents. Both defendants eventually reached settlements with Immersion involving multi-million dollar payouts. Sony was forced to pay $150 million, while Microsoft opted to buy a 10% stake in Immersion and a perpetual license.
It has long been rumored that Sony’s loss led the company to release the PlayStation 3 version of the DualShock controller without a word.
In 2016, Immersion claimed that Apple infringed two patents for the iPhone 6s and the Apple Watch. And in May 2023, Immersion sued Valve for alleged infringement related to the use of vibrations in the company’s Steam Deck and Valve Index VR headsets.
It’s interesting, as of late Position by Gary Bourgeault of Seeking Alpha, Immersion’s business model isn’t particularly profitable — or sustainable in the long term. The company stayed in the $30 million to $36 million revenue range for several years, with significant overhead from its litigation against companies with huge legal departments and deep pockets.
“On the trial side, [Immersion] may receive temporary boosts to its stock price due to the millions of dollars awarded to it,” Bourgeault writes. “[B]as mentioned earlier, there aren’t many big companies to move the needle if it decides to take legal action to defend its patents… The thing is, while there is a very predictable flow of flat fees, licensing and royalties, these revenue streams dry up once patents run out.”
