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Netflix Sues Blockbuster for Patent Infringement
Posted by
Zonk
on Fri Sep 08, 2006 12:34 PM
from the lovely-time-of-year-for-an-infringement-case dept.
from the lovely-time-of-year-for-an-infringement-case dept.
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."
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Backslash: That Nagging Netflix Queue 161 comments
Instead of being used and returned at the pace of cloth diapers, it seems DVDs rented from Netflix are often gathering dust, unwatched, in customers' homes, in what a posting yesterday dubs a "paradox of abundance." Readers suggested some reasons why this was so, and why this might not be a bad thing, in the comments attached to the story; read on for the Backslash summary of the discussion.
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Business models? (Score:5, Insightful)
Re:Business models? (Score:5, Funny)
Parent
Re:Business models? (Score:5, Informative)
Parent
Re:Business models? (Score:4, Funny)
four bucks to rent a movie? screw you, blockbuster.
Parent
Re:Business models? (Score:5, Insightful)
- 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?Parent
Re:Business models? (Score:5, Informative)
http://en.wikipedia.org/wiki/Red's_Giant_Hamburgs [wikipedia.org]
Parent
Re:Business models? (Score:5, Insightful)
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Re:Business models? (Score:5, Informative)
Parent
The patents (Score:5, Informative)
6,966,484 [uspto.gov]
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 [uspto.gov]
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.
Parent
Re:Business models? (Score:4, Informative)
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Re:Business models? (Score:4, Interesting)
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Re:Business models? (Score:4, Informative)
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Re:Business models? (Score:5, Insightful)
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Re:Business models? (Score:5, Informative)
Also, my local library (Multnomah County, downtown Portland Oregon) did the same thing: for one dollar per book, you could get a book, either from the library or inter-library loan sent to your house. You could only have two out at a time that way, and you could have a queue which, in the mid-80's, you could update online by dialing in (directly, via 300 baud modem!). (You could also update it over the phone, by mail, or in person at the branch, I believe). They would send the next one when you sent one back.
These are the only two I can think of. But any decent patent lawyer should be able to find these and others pretty easily, I would think.
What about other companies doing exactly the same thing? Like DVDBarn, Intelliflix, etc.? Is Netflix suing them, too?
Parent
I'm pulling for Blockbuster (Score:4, Insightful)
It's not new (Score:5, Informative)
(I've posted this information before, but it seems to bear repeating.)
Parent
Re:I'm pulling for Blockbuster (Score:5, Insightful)
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.
Parent
In other news (Score:5, Funny)
Blockbuster may have a case (Score:5, Interesting)
What a let down.... (Score:5, Insightful)
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....
Ben Franklin said it best... (Score:5, Interesting)
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?
Patenting business models? (Score:4, Insightful)
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...
Good luck to Netflix on this one.... (Score:4, Insightful)
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!"
Re:Classic... (Score:5, Insightful)
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Re:Busted, but maybe not... (Score:5, Interesting)
That bin was almost a sea of red. Netflix envelopes by the TON. I commented on that, and the clerk said yes, the P.O. was proud of the special handling deal they have.
Netflix is now the fifth largest user of first-class mail. At the cities where they have processing centers a Netflix truck drops a load of outbound envelopes bagged by ZIP code and pre-sorted down to carrier route, and picks up the incoming directly off the dock.
rj
Parent