Netflix Sues Blockbuster for Patent Infringement
StrongGlad writes "Is the concept of renting movies over the Internet an original idea that deserves patent protection? Netflix claims it is, and is suing Blockbuster for patent infringement, alleging they are copying its seven-year-old online movie-rental business method. Netflix argues that it has patents covering its many online features, including allowing subscribers to keep DVDs for as long as they want without incurring a late fee, obtaining new DVDs upon return of those already watched, and prioritizing their own personal movie list. Blockbuster, for its part, has counterclaimed, insisting that Netflix is trying to monopolize the online movie-rental industry and stifle competition. Blockbuster also alleges that Netflix obtained its patents fraudulently by failing to disclose pertinent information to the U.S. Patent and Trademark Office, and further contends there is nothing original about renting videos online in the first place."
Since when are business models subject to patent rights? Products, yes, but business models?
"You can't compete with me. I was here first. Go away!"
Some of those patent claims sound a little fishy, but IANAL. However, it's interesting that my main squeeze signed up for Blockbuster's service about the same time I got Netflix, and the first comment out of her mouth when describing it to me was: "It's just like Netflix!" Curiouser and curiouser...
How exactly is renting movies online an original or novel idea? I think Netflix is feeling the pinch in their pockets from Blockbuster and is resorting to some desperate measures. I really hope the courts send a message to businesses that patent lawsuits are not just another source of income.
Go Illini!!!
SCO is suing Netflix for stealing its business method....
I for one am rooting for the little guy.
Oh, wait...
Im all for it! Eventhough the pricing isnt bad to begin with!
Whoa! You can patent a Business model! Hot Damn!!
I guess I should patent my idea of "Method of High Speed Beef and Bread Preparation, Processing and Procurement" and go after a certain clown I know!
(Sarcasm lever high on this post folks)
In Soviet Russia, Trojan exploits YOU!
Maybe blockbuster could countersue for the business model of renting movies on a recorded meduim and then returning them to rent of others.
My Computer Music Tutorial Videos
I'm a big netflix fan. I got into it in order to re-watch the entire xfiles series last year. I also like the story of its origins: someone finally got sick of ridiculous late-fee charges, and in answer, blockbuster lost mega business. Blockbuster countered with its own service which I thought was not doing well against netflix. This latest news seems to indicate otherwise.
But netflix using patent laws this way is crazy. Blockbuster should counter with the charge that they own the ability to perform the action of receiving monetary units for analogue and digital copies of light and audio produced theatrical and documentary events....
"All great things are simple & expressed in a single word: freedom, justice, honor, duty, mercy, hope." --Churchill
In his autobiography, he recounts that he was offered a patent on a new
kind of stove he invented that was a tremendous improvement in terms of
heating a building and in reducing the amount of wood needed.
He declined this patent, stating that from "Principle which has ever
weigh'd with me on such Occasions, viz."...
"That as we enjoy great Advantages from the Inventions of others, we
should be glad of an Opportunity to serve others by any Invention of
ours, and this we should do freely and generously."
But screw that, right?
Sugapablo
I for one hope Blockbuster wins this hands down. I use Netflix, love the service (6 at a time, one day turnaround and haven't noticed any throttling yet ~35-40 movies month) I tried Blockbusters service and was not thrilled with the selection and turnaround, although not significantly worse just my preference. The shear fact that blockbuster is in the market though is what will keep me happy with Netflix. If Netflix sat as the only one for too long, they would inevitably succumb to greed.
It was only a matter of time. Porter's model proven again. Blockbuster (like Microsoft) let its guard down and let a critical external force overtake its market-share: Substitutes.
Go ahead Netflix, kick 'em while they're down! You're the new guerrilla in the DVD rental business, and rightly so. On behalf of every poor college kid that ever got a collections notice for $4.38 for late fees that weren't paid in 4 weeks or less, I say thank you. Bury the bastards.
That story is false.
Gamingmuseum.com: Give your 3D accelerator a rest.
"..on the internet"
If you can patent business models, and Netflix can sue Blockbuster for renting movies by mail/internet, can't Blockbuster sue Netflix for renting movies period? (I suppose if they had a business model patent that expressly stated brick & mortar businesses, they couldn't.)
businesses have been using the gov't to give them an edge for hundreds of years. Agribuisness corps were founded by gov't irrigation, car companies by gov't road projects, Pharmaceuticals get the gov't to do all the difficult/expensive research, etc, etc. There is a long and illustrious history of using your tax dollars to screw you over. It's like Gore Vidal said: capitalism for the poor and socialism for the rich.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
If we're lucky, this might be the case to finally set a precedent against the old formula
If Blockbuster doesn't settle out of court, that is...
For further reference, here are the patents:
6,966,484
Mailing and response envelope
Abstract
A mailing and response envelope for conveying an item from a sender to a recipient and back is disclosed. The envelope comprises a base panel, a sender address panel, and a recipient address panel. The sender address panel is affixed to the base panel by an adhesive region. The sender address panel and adhesive region define a pocket sized to accept an item. The adhesive region extends laterally on the base panel in an amount selected to ensure that a postal cancellation is not applied to an area overlying the item. The recipient address panel is joined to the base panel by a detachable joint. In this configuration, a fragile item may be conveyed from the sender to the recipient and from the recipient back to the sender without damage to the item.
7,024,381
Approach for renting items to customers
Abstract
According to a computer-implemented approach for renting items to customers, customers specify what items to rent using item selection criteria separate from deciding when to receive the specified items. According to the approach, customers provide item selection criteria to a provider provides the items indicated by the item selection criteria to customer over a delivery channel. The provider may be either centralized or distributed depending upon the requirements of a particular application. A "Max Out" approach allows up to a specified number of items to be rented simultaneously to customers. A "Max Turns" approach allows up to a specified number of item exchanges to occur during a specified period of time. The "Max Out" and "Max Turns" approaches may be used together or separately with a variety of subscription methodologies.
Developers: We can use your help.
How about infringing on their patent for bumping heavy users to the back of the line? If they can stop Blockbuster from doing that it'd benefit everyone.
Fuck Blockbuster.
I know that has been a popular sentiment ont his board for some time and that im not in particularly new....... But, I still have a bad taste in my mouth from YEARS of Blockbuster / Viacom screwing me (and everyone else) royally.
The late fees. The bad selection. The late fees. Changing the rental system to somehow appease a lawsuit they lost and at the same time still trick people into paying more late fees.....
And then Netflix came along, and the first few times you saw it in print was wondering if they could ever even get the attention of the Blockbuster juggernaught (anyone besides me remember the college football Blockbuster Bowl?). Well yeah, I guess they got Viacoms attention finally. After their entire business had been decimated. How long was this in the making?
After Blockbuster ran EVERY Mom and Pop video rental store off the planet they want to somehow play the underdog? They didnt have a chance to see what Netflix saw and ditch the brick and ortar stores? Yeah I know thats expensive, but the real estate they built those stores on would have recouped most of the money, and firing everyone else would have them squarely in the black, a place they havent been for a hot minute now...
So to recap, screw Blockbuster, but only because in their hubris they screwed (and are actively screwing) themselves.
---- The real Slashdot is still here. You just have to browse at -1 to read the comments.
If the judge in the case grants an injunction against Blockbuster's online service, there will indeed be many pissed customers out there. Thankfully, Blockbuster has at least one way to mollify them in the meantime: give their customers the same X-rentals-at-a-time access to their brick and mortar stores as they do through online rental queues. Blockbuster's online rental service already includes vouchers for a fixed number of store rentals per month (in parallel with the online queue rentals). This would just make it entirely brick-and-mortar based. The store on the corner doesn't have nearly the selection, but it might hold over some customers that would otherwise quit Blockbuster. There should be some way to craft it that doesn't encroach on the patents in question.
Note to self,
Time to patent new business model that increases customer satisfaction through the extension of services at prices the customer can afford while providing support and an extended "Customer is right" attitude.
Then I can sue all the companies that have happy customers, hmmm It may be hard to find them now.
Such as these: http://home.comcast.net/~plutarch/videos.html
Netflix is doing a marketing research thing in my area. I've agreed to meet with them in person for 30 minutes next week in exchange for 4 months free service. Now along with their throttling I'll have something else to hit them with.
Any suggestions of other stuff you'd want them to know or have your complaints heard through me? I'd be glad to bring it forward.
-[d]-
while this is completely insane, part of me wants them to win and put the final nail in blockbuster's coffin.
-- lol pwned
I hope they don't sue Greencine, cause I'm about to dump Netflix in favor of them and they seem like everything Netflix could have been.
When I lived in London in the 50's Harrods had a lending library. You paid a monthly fee and they assigned a librarian to you. He/she (mostly she) picked out books for you - or you could request specific titles. The books were delivered in Harrods green electric vans. When you'd finished a book Harrods would pick it up and ship you another one. Sound like a familiar business model? It even involved technology (the electric vans).
(I've posted this information before, but it seems to bear repeating.)
I used a CD rental service in England back when CD's came on to the market (1986 or so?). It worked in essentially the exact same way as Netflix.
This post is patent pending. All rights reserved. Do not make illegal copies of this post.
....for violating my patent for using a business model to try and make a profit.
Slashdot - Where the slash is most definitely to the left.
The people involved in such lawsuits are only familiar with Benjamin Franklin, not Benjamin Franklin.
I have an ex who worked for Blockbuster for quite some time.
They were developing methods for on-line rentals and even on-demend video distribution back in about 1999 IIRC. Netflix was actually copying Blockbusters model , only doing it on line, until then. (Having late fees, etc, making people pay for postage).
They will be deperately hard pressed to prove they innovated many , if any, of these business practices, and I believe some of their patents could actually be thrown out because of being brought to the light of day like this.
I despise with a passion "business model patents" which basically say "we figured out how to do business, don't you dare try to compete with us!"
I'm a fiscal conservative, it's a pity we don't have a political party anymore
Blockbuster should just patent the business of renting videos and dvd's then sue netflix and everyone else while they're at it. Then RIM could patent a 'Method and system for patenting overreaching and obvious patents' and sue both of them. First to concieve baby!
...where they are actively lobbying congress to get the laws changed to eliminate business process patents, if they are against it? A few links is fine...
Eh? Did you even read that? That Capitol Hill Blue retraction you cite is dated Jul 9, 2003. The Constitution story you're objecting to is two and a half years *after* he stopped using the bogus source Dec 9, 2005
The process of trolling for karma on /. is original, innovative, not obvious to an expert in the field, and has no prior art. Therefore, this process deserves patent protection.
This post is patent pending. All rights reserved. Do not make illegal copies of this post.
I'm not bitter, I'm just unsweetened.
C'mon. Do you remember what you first thought when you saw those first Netflix commercials? DVD by mail? How absurd! That'll never work. But it did work. It caught on through word of mouth and very intense advertising. It has made irrelevant the brick-and-mortar business model that Blockbuster survives on. Blockbuster just had an epiphany and said, "Wow.. we better get on this before it's too late." Netflix was smart to patent its business model and process. It took many iterations to get the current mail system down the way Netflix has. Blockbuster simply copied the Netflix model and is now claiming that Netflix never had a right to it in the first place.
I think therefor it has a patent
-- I am the NRA, enough said...
For those complaining about Blockbuster, if you have a Family Video store near you, check them out. New movies are $2.59 for a day, but anything old is $1 for 5 days. I've looked into Netflix, but it's more expensive for my viewing habits (a couple of movies a week).
What, me worry?
i signed up with blockbuster online a year ago and i love it. the fact that i get 2 free movies in-store a month is the kicker. it gets rid of the "crap i want to see this movie NOW" effect. well, at least twice a month. and i can use it for games as well.
anyway, i don't really have any opinion on the litigation, but i'd been wondering how long it would take for this to occur and what the effects would be.
Commercially viable electric vehicles in the 50s, in common useage? Do you recall the model/name of them to go look it up?
I have just canceled my account and have netflix to let them know why.
These cases are all about the claims, how they are applied and possible work-arounds. Of what I can see, there are two patents at stake here.
For patent US 7,024,381:
44. A computer system for renting movies to customers, comprising:
a computer that is coupled to a digital telecommunications network by a digital telecommunications link;
an electronic digital memory in the computer;
one or more sequences of computer program instructions stored in the electronic digital memory which, when executed, cause the computer to perform the steps of:
providing electronic digital information that causes one or more attributes of movies to be displayed;
establishing, in electronic digital form, from electronic digital information received over the Internet, a movie rental queue associated with a customer comprising an ordered list indicating two or more movies for renting to the customer;
causing to be delivered to the customer up to a specified number of movies based upon the order of the list;
in response to one or more delivery criteria being satisfied, selecting another movie based upon the order of the list and causing the selected movie to be delivered to the customer; and
in response to other electronic digital information received from the customer over the Internet, electronically updating the movie rental queue.
For patent US 6,584,450:
1. A method for renting items to customers, the method comprising the computer-implemented steps of:
receiving one or more item selection criteria that indicates one or more items that a customer desires to rent;
providing to the customer up to a specified number of the one or more items indicated by the one or more item selection criteria; and
in response to receiving any of the items provided to the customer, providing to the customer one or more other items indicated by the one or more item selection criteria, wherein a total current number of items provided to the customer does not exceed the specified number.
So, perhaps (not stating this for sure), Blockbuster could continue to have an online business with a movie service and avoid these patents by...
1. Not maintaining or sending movies based on an "ordered list" from customers
2. Not allow customers to change such a preference lists online, but through some other method.
Of the two options, using a method of delivering the movies you prefer when you return previous ones (and not before) could be a possible alternative - no ordered lists or predetermined selection criteria, perhaps just a 'preference list' that you could save on their site that is not an automatic trigger for the next movie. How could this be applied? Perhaps by using text message, email or rss feed to request you to make a choice prior to shipping from that total preference list.
Of course, we're all trained to think about ordered lists (by Netflix), but Blockbuster could market the other option that you choose what movies you want to see, when you want to see them (if its not available, you get X for free). Netflix patented a good way to do it, but not the only way.
Working to make ideas into reality. www.i4e.com
"What makes this next -- erm popInTheMail-up? -- even more fun is that this is the twelfth time that Avesh Jain has received a "1 of null" DVD. Wonder if his bill will be $NULL ... "
http://thedailywtf.com/forums/thread/90530.aspx
The night before driving a couple states home from university for the summer, a bunch of my friends and i stayed up all night, rented movies and ordered pizza. On the way out of town that morning, i drop off all the movies and went home. I get a collection agency notice at my perm. address saying i had late fees of $2.67 and they were wanting to collect. Since the credit card i signed up to blockbuster with had expired over the summer, they didn't get anything and the collection agency didn't do anything either, and i don't have an account with them. I find it ridiculous that i dropped them off and somehow they didn't 'recieve' them for another 2 days... WHEN I WAS NOT EVEN NEAR THE STATE.
both fcuking suck if u dont live near a big city. Can hardly get 3 movies in a week....
It's a good thing that the founders decided to write something into the constitution to promote the progress of science and useful arts. Otherwise, there would be no incentive for Netflix to have a business model! ;-)
As copyright owner of this comment, I authorize everyone to defeat any technological measure which limits access to it.
In one way or another, people want to own ideas. Thoughts themselves, for sale. No longer are people building better mouse traps, they are trying to build a case for owning devices that kill and or trap mice, possibly with adhesive labels.
The most successful poeple try to open any door, where oppurtunity may be knocking. With the massive amounts of money being used, people just want to "do" as much as possible. Something silly to me or you is just another scheme to someone who may possibly pull it off. If netflix wins, they get to roll around in cash. If they lose? Well, I imagine the cost of this lawsuit is a drop in the bucket of marketing expenses.
PS: That is what part of the alphabet would look like if the letters "Q" and "R" were removed.
I hate blockbuster so more power to Netflixs!
:p
Side Note: This "confirm image word" I can't even read it to type in the right letters! And no I'm not visually imparied
"You failed to confirm you are a human. Please double-check the image and make sure you typed in what it says"
lol this is my 4th time, I obviously can't make out the letters. Those 1's l's?
As Systems Manager for a family owned and operated video store in Maine competing directly with Blockbuster, I have personal experience with Blockbuster utilizing immoral and/or illegal practices, to the detriment of both its' competition and customers, so I don't feel sorry for them in the least, and hope they burn in retail hell.
Isn't this old news? I swear I saw this Slashdotted a long time ago.
For sale: Parachute. Used once. Never opened. Small stain.
More than ten years ago, the Multnomah County Library in Oregon used to let you check out books and movies via their online library catalog, and they'd mail them to you in special envelopes, which you would just drop in the mailbox to return when they were due. Cost: $2 per item. Ten years earlier than that, the Seaside library a hundred miles west did the same thing. It looks like a lot of people came up with the idea independently--almost the definition of obvious.
"First to make a successful for-profit company using this business model" is not an acceptable metric for determining what is non-obvious.
Bored With ProgressQuest?
Can you patent a business model?
IANAL but I have this belief that patents protect how you do things, not what you do. Can I patent the concept of a car that gets 200 miles per gallon or am I patenting the particular means by which my engine gets 200 mpg? Wouldn't a reasonable patent be one which allows someone else to come up with a different means of accomplishing the same thing?
Why is it that every popular article I read on USPTO missteps seem to indicate that the USPTO is allowing people to patent the sheer concept of doing things? Amazon's one-click patent... if I come up with a differnt way of allowing people to buy things with one click that should be allowed.
Netflix's online dvd rental patent seems to be a similar "concept patent" which seeks to block any and all other means of accomplishing the same thing. This has truly gone too far.
I think the problem with this entire thread is that people are talking about three different things
1. Whether or not patenting business methods is ridiculous (and yes you can patent business methods in the U.S.)
2. Whether or not this specific claim by netflix is ridiculous (ie. is their business method patent so obvious that it shouldnt have been granted in the first place or should there be a limit to how long such patents stay in effect)
3. Whether or not we'd like to see blockbuster go down in flames (I know I do)
That being said, I think emerging technologies (ie. anything internet/computer/media related) have really exposed weaknesses in current U.S. patent law. There is a delicate balance between fair competition and protecting/rewarding innovation. If Blockbuster had reacted faster and was well within their rights to copy the Netflix business model then Netflix might just be a passing blip on the timeline. The idea behind patents is that you are protecting innovation, in many cases from large organizations that could easily take over your idea with advantages like capital, brand name recognition, distributuion, cross-marketing, etc.
However, with the growth in all these markets (mainly media, software, and internet) it seems ridiculous to allow patents that seem like an obvious and inevitable integration of two or more existing concepts and grant any one entity control over that model for twenty years. In this case is Netflix concept innovative enough to patent? I think it was at the time. They would be stupid to not file a patent for a new distrubition model they rely on and I do think companies like blockbuster should compensate them for the idea, but I also think patents like these should grant rights for a smaller window of time. 2-5 years seems fair.
Regardless... The intent of the laws are really all that ultimately matter since they are decided by judges and juries. I have been continually impressed by the understanding and decisions of a lot of judges in IP cases. If you actually follow up on a lot of these cases that get people worked up about you will see that judges generally make intelligent and informed decisions.
For the record, I'd like to see Blockbuster fail. Though I did love them once for their music stores with the listening stations, I've always hated their video rental fees, their crappy selection of older movies, and how they'd put smaller stores out of business (stores that had a more knowledgable staff and carried adult titles!)
Since when do politicians nip problems in the bud? Folks, this has to get worse before it gets better. Our patent system will receive the overhaul it desparately needs when:
A) There's a concrete enough financial interest that it generates a lobby.
B) Joe Sixpack is displeased with the situation.
We can all make B) appear to come a little faster by bitching to our Congress-critters every time we see an abuse like this. Remember net2phone's "method of establishing a communication channel by exchanging IP addresses" patent? Don't let this shit slide!
If other reasons we do lack, we swear no one will die when we attack
FREAKING SCRATCHED DISCS. Yes, that was a yell. Nothing is more infuriating to my wife and I.
Man, I patented "Be kind, rewind" stickers back in 1983, and do you think I've ever seen a dime from it?
Business patents are by definition monopolies. No patent should be awarded on anything that isn't a working mechanical device, at least a prototype. Descriptions of ideas, whether human readable or machine readable, are subject only to copyright. Identifying marks, like logos and slogans, are only trademarks.
These principles are obvious. Not only are they politically obvious to anyone who understands that artificial government monopolies must merely balance freedom of expression against investment protection. They are obvious to anyone in business. It's obvious to people patenting how much advantage they gain. And it's obvious to people excluded how much competition it prohibits.
Maybe now that American business is becoming at least as much a consumer of IP as a producer, these corporations will battle away the IP law imbalances that crimp their economy. Then we'll also see how obvious it is that corporations are the only "persons" which matter to the government.
--
make install -not war
I don't like that Blockbuster participates in corporate censorship of films, but I also think Netflix shouldn't be so damned greedy in its patenting practices. I'd cancel my Netflix account over this but then they might have just gotten the patent so that they could sue Blockbuster. Anything to kill Blockbuster is ok with me but there's a legitimate line to draw somewhere. Hrmm... burn in Hell Blockbuster, you un-American bunch of fascists.
I think people often mistake "not having been done before" with something that is original. The question I'd like to explore is, "How many considered it as a possible business model?" Best case, what we may very well have here is a model that has been considered by many, but popularized by a one. That's not exactly what I would consider "original". It's tantamount to trying out a musical style that doesn't go over so well during one time period, only to have it resurrected down the road at some point when it becomes wildly successful.
Being simplistic, this sounds like one company decided to not charge late fees, so another company adopted the same practice. Pretty much everything they do is not new or unique, just expensive for a start-up. An established business like BlockBuster can and will compete by offering the same services.
;)
Do you need to patent your business methods and operating procedures, or copyright your fancy return mail envelope to compete effectively? I think that if NetFlix is not able to compete with an established company in a similar market, that they are no different than a mom and pop grocery trying to compete with WalMart SuperCenters. It may not be the best thing for the community or the market, but it is the community or market that will make or break them, not their copyright or patent portfolio.
A business that survives by blocking other companies from using obvious methods, is no better than a parasite. They provide no benefit to society, and only serve to promote the proliferation of lawyers.
Where is Schlock Mernenary company when you need them.
http://www.schlockmercenary.com/d/20021110.html
Here's the link to the ghost of the vans. Sadly, the real thing are gone. The color was much nicer than it looks in the photo.
Quite a few lending libraries used to do something similar back to the 1800's. Remote students or school districts would receive the books they requested via the mail. When finished, they sent them back. To ensure turnover and prompt returns, many had a policy of "only x books at a time".
Do you think "I'll charge money for that service" passes the test of "too obvious"? How about "I'll send DVDs instead of books"?
Our milkman in London had an electric vehicle that looked like a cart. He walked in front of it and steered with a handle. We still had a gaslighter too, when I first got there in '55, but he was soon made redundant by advanced automated gas lighting technology. There's nothing quite like the atmosphere from a gaslight.
OK, this is fun, I'm still just a baby neogeezer but see what I can do here... I'll try to do some more geezer things the young kids here won't believe...that gas lighter was a good one, never seen that one..
Ok, my grandma still had an icebox and the iceman used a horse and wagon, came down the alley to make the ice deliveries. This was similar, mid 50s in Detroit. Hmmm...I've made nickle phone calls, got gasoline at 12 cents a gallon, and used a phone that was bolted to the wall and had the separate earphone and mouth piece, one of those old wooden jobs (my other granny's phone actually). Oh! Here's a cool one, when I was in school it was common for some of us who were hunters or target shooters to take our rifles to school with us so we could all go shooting after school let out in the afternoon. I can see the helicopters and SWAT teams now....pretty funny, and we had no massacres that I recall...
Your turn! I hope some young guys are reading this...
Well to go ahead and triple my mistake I apologize for the dueling responses to your post. I was informed that there had been an error and that my comment wouldn't be posted and then it was. Again sorry.