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Amazon Sued For Patent Infringement
Daeslin was the first to write with the news that Amazon has been sued by Intouch for patent infringement. Intouch alleges that Amazon has violated their patent describing a way for customers to preview music samples over the Internet.
Bezos--
That's why.
Yeah, you might be able to hold off an entrenched competitor from having some cool little +5% sales widget.
Sure sucks when *you* become the entrenched competitor, doesn't it though?
When will you understand that *the entire Internet Business Model* can be Verboten By Patent?
It's the Tragedy of the Corrupted Commons: Instead of there being one gigantic field that everyone can graze from, imagine a field with thousands upon thousands of overlapping fences, property lines, and deeds of "sale" from an overzealous government agency with the philosophy of "Our cronies will get rich overbooking the land, then our cronies will get even richer fighting eachother over who's land is really whose, all the while we'll be able to extract more property tax out of the same land many times over!"
Gets worse. The average commons is divisible--except for a "main well", sections can be fenced off and still leave an adequate, if shrunken, commons. Internet Business is something of a field where a given patent can end up enclosing sections where "if you can't use it, you starve". It's not like every blade of grass is interchangeable--it's more like, you never know if you're working on safe harbor...or a landmine.
It really gets quite nasty once you get into submarine patents. I won't even go into the analogies that brings up.
The end result of the Corrupted Commons is a No Man's Land. It ends up just not being worth exploring what gains the land can bring, because the risk is so great.
Yours Truly,
Dan Kaminsky
DoxPara Research
http://www.doxpara.com
Even though this feels like "poetic justice," I still hope Amazon wins. This sort of patent is the sort of thing that really deserves to be struck down. Anyway, perhaps now Bezos will really work on that patent reform he's been talking about.
Visit me on #weirdness on the Galaxynet.
That said, it is not true that "if they don't do everything _legal_ to up their earnings, he stockholders can and will sue." The management of a company is simply not under obligation to explore every possible legal source of revenue. Can I sue Ford because they don't write software, or GM for not owning gold mines ? If I buy Redhat stock and they don't drill for oil, I was not injured in any way because I knew they weren't in the oil business when I bought the stock.
The responsibility of the mangement to the stockholders is merely to not fail to do something a stockholder would naturally expect without telling them first. You can't start a company with a nice looking published business plan and have a real secrete plan of paying yourself a salary to do nothing until the company folds.
There would be no reason to uphold a suit against Amazon for failing to pursue the patent, especially if they had declared publicly that they were not going to pursue software patents. A good court would hold that the stockholders can sell their stock if they don't like it. A good court would see itself as a protector of the stockholder from deceit and neglience. The market will take care of incompetence; the court just has to assure the information is not kept from the market.
Think about it this way: the ability of stockholders to take their money and run makes the stockmarket a very efficient judge of business strategies. Do you really think that a judge and jury can do a better job ? Resort to the courts may be justified when extreme and rare plots and colusions attempt to hender the efficiency of the market.
There existed no reasonable expectation that Amazon should have a business plan based on the bureaucratic incompetence of the PTO. Amazon could have choosen to explicitly deny themselves that path.
But they didn't. Jeff Bezos and his company have choosen a business plan which has as a primary feature the denial of my freedom. Their plan is make sure no one else (including me) can make a one-click shopping site, and they plan to live off of this government enforced monopoly. If that doesn't make Amazon the Antichrist, it at least puts them on the same team.
I loose freedoms every time the PTO gives out a patent, but much of the time I at least get something back -- a business that would not have been worth trying without the monopoly guarantee is attempted, bettering the economy on the whole. However, Jeff Bezos and Amazon are just a tax. If we did not award business method and software patents, someone still would be selling books online with one click, and I would still have a tiny piece of freedom that Jeff Bezos wants from me.
The InTouch patents US5237157: Kiosk apparatus and method for point of preview and for compilation of market data and US5963916: Network apparatus and method for preview of music products and compilation of market data give remarkable insight into the minds of InTouch. The first patent is specific to their iStation device and mentions kiosks and CD stores and the like. It seems that after their device gained no market share (because it's a dumb idea) they decided to refile a new patent in 1999 that basically was a rewording of their original patent with the words kiosk and apparatus taken out and substituted with networked computer.
This seems to be a horrific example of what can only be described as patent squatting. Besides the fact that the InTouch patent filed in 1999 simply described ongoing practices at CDNow, Amazon and dozens of other music sites, it does not seem like InTouch has any customers or that their technology is being used anywhere. Their website contains nothing but sales pitches and has no mention of customers or anywhere their software is being deployed. IIRC, there is a law against obtaining a patent then waiting for companies to make money off of it then suing them.
It will be interesting to see how this plays out in court.
One of my favorite gambling stories is about mental bets. A few years back in a Houston, Texas casino an elderly, distinguished-looking gentleman slightly in his cups wavered back and forth being a group of women players at the Roulette table. Nobody paid any attention to him until he began complaining about how unlucky he was. "What do you mean, unlucky?" the croupier asked.
"Number thrirty-two just won, didn't it?" the grumbler said.
"Yes, but you didn't have a bet down. What's unlucky about that?"
"Oh, yes, I did," the drunk groaned. "I made a ten-dollar mind bet on twenty-six and lost!" Then he handed the croupier a $10 bill. "I always pay my losses-even on mind bets."
The croupier tried to return the money, but the old gentleman stubbornly refused to take it. Since this argument was creating a commotion and interrupting the game's action, the croupier finally shrugged, smiled wryly and shoved the bill into the money box.
The drunk, apparently satisfied, disappeared in the direction of the bar, but he was back again before long. He walked up to the table just as the croupier spun the ball. He wobbled unsteadily and watched until the ball dropped; then he came to like, shouting excitedly, "That's me! That's me! I bet ten bucks on number twenty and I won!"
The croupier tried to continue the play, but the drunk, who suddenly seemed much more sober, interrupted loudly, demanding to be paid the $350 he had won on his mind bet. He kept this up until the casino manager was called. After hearing what had happened, he ruled that since the croupier had accepted a $10 losing mental bet, he must pay off on the winning mind bet. You can be sure that this was the last mental bet which that croupier or any other in that casino ever accepted.
The above comment is CopyWrong (K) Erisian Entertainment. All Rights Reversed. Ewige Blumenkraft!
Rinse, Repeat.
Let's see... Amazon gets awarded ridiculous blanket patent on simple concept... Amazon gets sued for violating ridiculous blanket patent on simple concept... can you say "instant karma"? Very good, I knew you could.
Seriously, this just goes to highlight the problems with the patent office in the modern age. Someone got a patent for the networked equivalent of a jukebox... kind of makes you wonder about that commercial with the diner that had cheap coffee, lousy food, no choices, and "every performance of every song ever written"... do the people who wrote that commercial know they were talking about a patent violation?
I suspect a patent exists for just about everything I've ever programmed, that I was unaware of, and frankly, couldn't care less about. Sooner or later, one of these is going to get seriously overturned, and that will be used as precedent for overturning the rest. Maybe, if we're lucky, Amazon will accidentally shoot themselves in the foot by getting this patent overturned...
-- Still waiting for the Nike endorsement
Listen. The opinions and actions of Amazon have not been the heinous force of evil that everyone seems to think. A business (any business) is legally required to attempt to make money for it's investors (or risk getting sued). As this is the case, Amazon had no choice but to work within a flawed system. They had to attack B&N, and they have to defend themselves now. So this is all really evidence of a fundamentally flawed patent system.
Patents aside, I actually like everything else Amazon has done. They have proven that a "new economy" business can work. (Their book division is already profitable, with their other divisions not far behind) They make a (formerly complex) aspect of my life incredibly simple.
If Amazon is smart, they will put some of those overinflated stock dollars toward fixing the broken patent system. This would, IMHO, solve all of their patent problems. Both legal-wise and PR wise.
Thank you for not thinking.
A poor man once went to his wealthier neighbor and told him, "Sir, my son is soon to be married, and his bride's parents will be coming to visit. But my house is bare and I am ashamed that they will see it like this. Could I borrow from you your silver spoons?"
The rich man considered it - he was not one to lend out his things lightly - but ultimately agreed. The next day the poor man returned with the spoons, and another small silver spoon as well.
"What is this?" the rich man asked.
"During the night one of your spoons gave birth. Since it is your spoon, the child should be yours as well."
The rich man thought this was ludicrous, but he was not one to pass up good fortune, so smiling he accepted the small spoon.
Several weeks passed, and again the poor man came to ask to borrow the spoons; remembering his previous good fortune, the rich man assented, and once again found himself presented with another spoon.
A few weeks after that, the poor man came to the rich man again, explaining that the wedding itself was coming up, and asking to borrow his silver candlesticks. At this the man hesitated; spoons, yes, but those candlesticks were pure silver! But mindful of his previous luck, and with visions of money dancing in his head, he agreed to let the poor man borrow them.
The next day the poor man came back, empty-handed.
"Where are my candlesticks?" the rich man asked.
"It is horrible! Last night they were beautiful - but this morning, I came and they were both dead!"
At this ridiculous line the rich man flew into a rage. He accused the poor man of being a thief, and soon the two came up before the town rabbi, who heard their case.
The rabbi considered it carefully, and said: "If a spoon can be born, why can a candlestick not die? If you chose to accept nonsense when it was profitable to you, you can accept the same nonsense when it brings you loss."
So it is with Amazon; as they accepted the idea of one-click patents to protect their money, they can accept the idea of sampling audio as well. Perhaps once this is finished neither side will be so foolish again - and the patent office will not encourage them.
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Although it's tempting to say "it serves them right", it's just one more example of how broken the US patent system has become!
The patent they have infringed is another one of these translate something from a normal environment where it's obvious to the Internet and then claim it's novel things.
Going into a music shop and listening to the music before I buy a CD is hardly earth-shattering in the real world. It shouldn't be on the Net either. I really wonder if the USPO assessors get out at all! :)
Stephen
It's pretty easy to think that way... the problem is that this doesn't help anyone. Amazon's laywers will just see it as proof they need to agressively use their IP. It makes the high tech field into a prisoners game, where people have no reason to help out a neighbor because
Reading the headline I barely surpresse a chuckle, as I was thinking pretty much the same thing. As I read further it just makes me sad. Many people share this common belief that we can uplift our situation and make things better using technology. It saddens me to think how much hard work and money will instead be devoted just working around these trivial patents. How ironic that the patent system was designed to help industry move forward and is now the biggest threat to forward progress there is.
ObDisclaimer:
liquid audio pays my bills, but I don't speak for them.
--
Be insightful. If you can't be insightful, be informative.
If you can't be informative, use my name
Be insightful. If you can't be insightful, be informative.
If you can't be informative, use my name
Before all of you start waxing about poetic justice (too late), go read the article, or check Intouch's site. You'll note that link is straight to the particular product that holds the patents that they claim are being violated.
Redundant summary for the billions of you too lazy to read the article:
According to the CNet article they got one patent back in 1993 and another in 1999. They feel sites such as Amazon.com, Liquid Audio, Discover.music.com, and more have violated this patent repeatedly and are stealing their market share.
The particular product that's being abused is the iStation (a name as original as the patent) that allows customers at a CD store to listen to music online. Note the database is accessible only from the CD store, not to the common internet surfer.
This suit has no relevance in my opinion, because the audiences are completely different. It seems as if InTouch is suggesting that all online music-samples should come from their database.
This isn't poetic, this is far lower and more frivolous than Amazon's One-Click patent.
But then I remembered Bezos' defense of his companies' patents. He said that he felt as much as we do that they're bad, but he had to use them because everyone else did and they were necessary to compete.
Unfortunately, this lawsuit will only further convince amazon that everyone is using patents and lawsuits and they must too in order to be competitive. As a matter of fact, our attempts to convince amazon to change it's position on this issue may be seriously set back. This is a sad, sad day...
The bus came by and I got on
That's when it all began
There was cowboy Neal
At the wheel
Of a bus to never-ever land
I'd rather be lucky than good.