RSSBlockbuster, Netflix Call Patent Truce
By Nate Mook | Published June 27, 2007, 12:00 PM
Two fierce rivals in the DVD rental business have called a truce - at least when it comes to patents. Blockbluster has agreed to settle with Netflix over charges that the brick and mortar retailer infringed on Netflix's online DVD rental patents when it launched Blockbuster Online.
In April 2006, Netflix asked a judge to bar Blockbuster from allowing online rentals, saying the company was infringing on two patents. The first was awarded in 2003 and covers the concept of the automatic queue, which customers add to from the company's library and then receive movies in a customizable order of preference.
The second patent was awarded on the day of the lawsuit, and covers the method that allows Netflix subscribers to keep the DVDs for an unlimited amount of time, and "to obtain new DVDs without incurring additional charges and to prioritize and reprioritize their own personal dynamic queue--of DVDs to be rented," the lawsuit read.
Netflix claims that Blockbuster knew of the company's 2003 patent and its work towards the second, yet ignored them with the launch of Blockbuster Online. Netflix added that the action to sue Blockbuster had to be taken in order to protect its business interests.
Blockbuster then countersued Netflix, claiming fraud and antitrust violations. It also said Netflix's patents were too broad to actually be enforced.
Analysts saw Netflix's lawsuit largely as a a defensive move; Blockbuster challenged Netflix's business by lowering prices and offering customers the ability to return online DVD rentals at its physical stores. The company still has far fewer subscribers than Netflix, but its online efforts have become a central focus moving forward, with store employees also tasked with signing up customers to Blockbuster Online.
Terms of the settlement were confidential, but Blockbuster said it would not have a material effect on future earnings.
1) An inventor creates a new business, accepts the contract to discloses at great cost the best implementation of their invention in exchange for the twenty year patent term. Then some scum bag parasitic patent pirating opportunist comes along and steals their property.
2) Patents have a description which is just a broad overview, and then they have claims which are very specific. Subtle nuances of claim wording play a huge role in the actual scope of a patent's coverage. I have yet to see anyone who is not very familiar with claim wording and case law who understands the scope of an invention. What I do see a great deal of is people reading the broad description and grossly misinterpreting what the patent is about.
Ronald J. Riley,
President - www.PIAUSA.org - RJR at PIAUSA.org
Executive Director - www.InventorEd.org - RJR at InvEd.org
Washington, DC
Direct (202) 318-1595 - 9 am to 9 pm EST.
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|If you read the Netflix patents, they're so terribly vague that it defies comprehension how the patent office even authorized it. I'm sure Netflix knew they were on shaky ground trying to defend it, and likewise, Blockbuster just wanted to move on. Eventually the Netflix patents will get tossed.
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|How can they actually provide patents for these things?
Isn't this like coming up with a patent for standing in line at a store?
I wish I had patented the idea of a website :)
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|I smell merger/acquisition in the air.
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