Rich Media Patent Stirs Controversy

The United States Patent and Trademark Office earlier this week granted design company Balthaser the rights to a patent that covers the creation of rich media applications on the Internet. While it may not seem like the news is of any consequence, the San Francisco-based company intends to demand payment from those using a range of Web technologies.

The awarding of the rights to Balthaser is sure to again stir controversy regarding the patent process, especially in light of recent patent fights involving companies such as Visto and NTP.

Companies who build applications using Flash, AJAX, Java, or a host of other methods to deliver rich content could all be affected.

"This new addition to our patent portfolio is a pioneering patent and provides significant licensing opportunities for both Balthaser and our licensees," CEO and chairman Neil Balthaser said in prepared remarks.

If the patent is allowed to stand, it could mean millions -- if not billions -- of dollars in revenue for Balthaser through licensing fees and royalties. However, questions have already arisen on its validity.

According to press reports, Balthaser filed for the patent on February 9, 2001. However, in 1999 a system to create multimedia content online was released by a company called Javu Technologies. Those affected by the patent could use Javu's work as evidence of "prior art," a common defense in attempting to strike down illegitimate patents.

Bola Rotibi, senior analyst with Ovum, says the patent carries broad implications. "What it does signify is the growing issues over intellectual property and patents within the IT industry, and it raises some important questions around what it is right to patent," she said, alluding to the high profile RIM-NTP case.

Many of the technologies that this patent would cover are being used in next generation Web applications such as Google Maps, Rotibi explained, and it would be damaging to the future of such advances if the big players allow Balthaser to "sneak away with the goodies."

"With such an action looming it is conceivable to predict a massive rush by the big players to either fight the patent or purchase Balthaser," she continued. "Either way, a mouse with respect to Balthaser's size has roared, and the consequences are unpredictable but important."