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."

Comments

Business models?

[daeg]

Since when are business models subject to patent rights? Products, yes, but business models?

Re:Business models?

[RovingSlug]

This is getting so out of hand. People think technology and the internet make these things special somehow. For instance

• Imagine if McDonalds had patented drive through food.

We'd all agree that's stupid, right? Why do people think business models on the internet is any different?

Re:Business models?

[rednip]

Great example, wrong company.

Actually that would make Mcdonald's patent example a better real world example, as many of these granted business model patents are just as disputable, as prior art seems to be often overlooked. Many claim that they often violate the novelty, and non-obvious requirements stipulated by patent law as well.

Re:Business models?

[geoffspear]

The 1-click patent is problematic, sure, but it's not really in the same category as this one. This is more like is Amazon tried to patent selling books on the Internet.

I'm pulling for Blockbuster

[xannik]

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.

Re:I'm pulling for Blockbuster

[kthejoker]

Yes!

Many of those hurdles could no doubt be covered by patents (such as "A Package To Mail A DVD without Breaking It") and good old fashioned business acumen ("We cut an exclusive deal with Fed Ex, and pass the savings on to you") in a way that encourages competition.

Being first matters a lot. It instills loyalty. But it's not a guarantee. And you know what? If some guy can come along and beat you at your own game, that's not inherently a bad thing. And if Blockbuster jacks up the price, someone else will just come along and compete with them, undercut them, and the cycle continues. There's no free pass in the market.

The *real* problem with NetFlix's model is that it's impersonal. It's just a DVD in the mail. Nobody cares about the color of the envelope. In fact, the NetFlix business model is the IDEAL "faceless corporation" business, because it's a

a) middle man service
b) driven by economies of scale
c) for a product everyone wants.

It's not a lemonade stand or a piano lesson. It's hegemony waiting to happen.

What a let down....

[Himring]

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....

Re:Classic...

[truthsearch]

I'd rather see them buried by the market than the legal system.