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Apple point-of-sale subscription filing likely stems from 'patent troll' settlement

post #1 of 14
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An Apple patent filing was released Thursday showing a system allowing retail outlets to sell periodicals to customers as part of an ongoing subscription, simultaneously saving money for customers and making money for retailers.

Magazine Patent


The filing, covering US Patent Application #20130024281, describes "a point-of-sale (POS) terminal, a POS controller, [and] a retail subscription system." It is aimed at cutting out the difficulty and price differential arising from a customer buying one issue of a periodical at newsstand price and then deciding she wants to subscribe to the periodical.

Under the above scenario, the customer winds up paying more, since newsstand issues are sold at higher cost than issues as part of a subscription. Also, the retailer loses out, since it gets no portion of the subscription price paid to the publisher, even though the retailer initiated the subscription sale.

Magazine Patent 2


Though the process described involves paper periodicals and retail locations, the granting of the patent to Apple doesn't likely mean the tech giant will be making a move into physical periodical sales any time soon. The patent revealed today matches US Patent #5926796, filed in May of 1997 by Jay Walker ? founder of Priceline.com (Priceline now says it has had no ties to Mr. Walker since 2000) and eponymous head of Walker Digital ? and likely stems from Walker's prior legal dealings with Apple.

In 2011, Walker Digital filed suit against Apple and more than 100 other companies, including Sony, The Walt Disney Company, The Weather Channel, and eBay, alleging illegal use of inventions it claimed to have created in the 1990s. It filed a second suit a week later against Apple and other companies over the iPad and multiple apps available in Apple's App Store.

Walker Digital was widely derided as a "patent troll," as few, if any, of the patents the company holds have materialized into actual products. Still, mid-2011 brought reports that Apple, Groupon, and others had settled with Walker rather than face drawn out litigation.

Newsstand
Apple's Newsstand feature may have necessitated a patent settlement.


The companies are said to have agreed to pay more than $25 million to settle Walker's patent suits, and the settlement is said to have included licensing and a sale of some patents. The periodical subscription patent would seem to have been among those sold to Apple, which deals daily with similar content thanks to the Newsstand feature it has built into its iOS platform.
post #2 of 14
Crying shame they feel the need to put time and effort into these things, but I guess it's part of their business. Must be a hectic place to work, if all eyes are on you.
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post #3 of 14
Quote:
Originally Posted by PhilBoogie View Post

Crying shame they feel the need to put time and effort into these things, .

Crying shame that AI keeps using incendiary verbiage like 'patent troll'.

A legal owner of a patent is free to do whatever they want with the patent. Practice it, sell it, license it, or do nothing. The fact that they are not practicing the patent does not diminish their rights one iota.

It's no different than if you own a manufacturing property and it's not currently rented. Since you're not using it, anyone who wants to should be able to move in and use it without penalty - or at least that's the conclusion you'd reach if you applied the same 'patent troll' nonsense to real estate.
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Gatorguy 5/31/13
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post #4 of 14
Quote:
Originally Posted by jragosta View Post


Crying shame that AI keeps using incendiary verbiage like 'patent troll'.

A legal owner of a patent is free to do whatever they want with the patent. Practice it, sell it, license it, or do nothing. The fact that they are not practicing the patent does not diminish their rights one iota.

It's no different than if you own a manufacturing property and it's not currently rented. Since you're not using it, anyone who wants to should be able to move in and use it without penalty - or at least that's the conclusion you'd reach if you applied the same 'patent troll' nonsense to real estate.

 

We have lots of fanciful terms for the bottom feeders. For instance, "slum lords, ambulance chasers, and pill pusher."  "Patent Troll" refers to a very specific type of patent holder. Namely, one who mimics the actions of a troll. The mythical trolls waits under a bridge, waits for a party to cross, then jumps out and threatens death if a toll isn't paid for crossing his bridge. Patent trolls do the same. They quietly wait for a company to launch a successful product, and then jump out of nowhere threatening injunctions if a license isn't taken. It is the way these so called patent holders conduct themselves that befit them the title "patent troll." Moreover, the patent at issue clearly doesn't apply to Apple's business, but people like Walker know Apple will pay millions in attorney fees to defend the patent. It costs Apple less to settle.

 

Further, patent law was created to spurn innovation. Walker had his team at Priceline sit around and patent thousands of ideas with no intent of doing anything but stand in the way of innovation by patenting broad concepts and sitting in the dark just waiting for somebody to step in the land mine. He obviously took the patents with him when he left Price Line. People like that hurt real innovators. Patent troll while sometimes used inappropriately certain fits in this case. 

 

PS:

 

With real estate it is quite easy to figure out who owns it. Not so much when trying to create a product because people like Walker intentionally make the patents vague. Further, like previously mentioned, the patent doesn't even apply to what Apple is doing. 

post #5 of 14
Quote:
Originally Posted by TBell View Post

... Further, patent law was created to [spur] innovation. ...

 

This is the key point. If you are gaming the system with your only intention being to siphon money off of actual innovators, you're a patent troll. That you are complying with the letter of the law is irrelevant. The term 'patent troll' implies that, and that you are using the shortcomings with the "letter of the law" and the system to exploit the law to your advantage in a way that was never intended.

 

These are the key characteristics of the patent troll: exploiting defects in and gaming the system to profit financially without contributing anything of substance, counter to the intended purpose of the law.

 

Arguments that it's perfectly legal are beside the point. If it weren't "perfectly legal" it wouldn't be a problem.

post #6 of 14
Quote:
Originally Posted by anonymouse View Post

This is the key point. If you are gaming the system with your only intention being to siphon money off of actual innovators, you're a patent troll. That you are complying with the letter of the law is irrelevant. The term 'patent troll' implies that, and that you are using the shortcomings with the "letter of the law" and the system to exploit the law to your advantage in a way that was never intended.

These are the key characteristics of the patent troll: exploiting defects in and gaming the system to profit financially without contributing anything of substance, counter to the intended purpose of the law.

Arguments that it's perfectly legal are beside the point. If it weren't "perfectly legal" it wouldn't be a problem.

That's all fine, but there are two problems with your analysis:

1. Most people use "patent troll" to mean someone who tries to enforce a patent they're not using. That's certainly the way AI uses the term. As I pointed out, that's absurd terminology - there are plenty of legitimate reasons not to use a given patent and to license it, instead.

2. Where do you draw the line between a legitimate technology investor and a "patent troll" (using your definition above). The answer is that you can't. Pretending that it's bad (even though it's perfectly legal) just because you don't like it doesn't make sense, either.
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post #7 of 14

I'm more impressed that Apple has already been granted 124 patents for the month of January, to date. And out of those 124 only 12 are Design Patents.

post #8 of 14
Quote:
Originally Posted by jragosta View Post

A legal owner of a patent is free to do whatever they want with the patent. Practice it, sell it, license it, or do nothing. The fact that they are not practicing the patent does not diminish their rights one iota.

 

Exactly.   Look at Apple, for instance.   They own lots of patents that they didn't invent and likely won't practice, but might use someday as leverage.

 

Apple (and their partners) spent millions of dollars' buying  thousands of Nortel and Kodak patents.  They certainly don't intend to use all, or even most of, them.

 

Apple bought Fingerworks and has never used any of their patents.  Worse, they dropped production of their much-needed ergonomic input devices.... which now trade for high prices on the used market, as they're no longer available.

 

It's not just patents.  Apple bought perpetual rights to use Liquid Metal in consumer electronics, and all that's happened so far (besides the SIM eject tool) is that other companies like Samsung, who had been using LM in their phones for years, can no longer do so.

 

As for "gaming the system", Apple's a pro at gaming the USPTO, and is well known for its habit of resubmitting minor changes until an examiner gives up and grants a patent, figuring that it can challenged later. 

 

It's all legal.

post #9 of 14
Quote:
Originally Posted by mdriftmeyer View Post

I'm more impressed that Apple has already been granted 124 patents for the month of January, to date.

Take that, Larry!
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post #10 of 14
Quote:
Originally Posted by jragosta View Post


That's all fine, but there are two problems with your analysis:

1. Most people use "patent troll" to mean someone who tries to enforce a patent they're not using. That's certainly the way AI uses the term. As I pointed out, that's absurd terminology - there are plenty of legitimate reasons not to use a given patent and to license it, instead.

 

I've not seen AI use the term in that fashion.

 

Quote:
2. Where do you draw the line between a legitimate technology investor and a "patent troll" (using your definition above). The answer is that you can't. Pretending that it's bad (even though it's perfectly legal) just because you don't like it doesn't make sense, either.

 

It's not a matter of it being, "bad (even though it's perfectly legal) just because you don't like it." It's a case of using patent law for a purpose contrary to it's purpose -- i.e., promoting innovation.

 

Just because someone patents something and doesn't make use of the patent, doesn't make them a patent troll. Sometimes companies apply for or buy patents for defensive purposes (against other companies and/or trolls). Just because you sue someone for violating your patent doesn't make you a troll. But, it's denying reality to pretend that there are not companies out there that buy up and/or churn out, often vague, idea patents (which is a problem with the system) with absolutely no intention of ever producing any product. They aren't even interested in marketing these ideas to other companies for licensing. Until, that is, they see someone making money off something similar enough to their vague idea patent that they can argue that, "this! this is what our patent is for!" and then attempt to extort money out of the "infringer".

 

We know this is happening, we even know who many of the most egregious players in this game are, we know what their strategy is, and we also know they contribute absolutely nothing worthwhile to society. They are leaches on innovation. One may not be able to precisely, before the fact, "draw the line" by way of definition in a way that unequivocally identifies exactly those engaged in this behavior and only those engaged in this behavior, but one can certainly recognize who they are, unless one is determined to deny their existence. The difficulty of exactly defining 'patent trolling' doesn't mean the problem doesn't exist, but it does tell us something about why it exists: because it's difficult to effectively stamp out. But that doesn't mean we shouldn't try.

post #11 of 14
Quote:
Originally Posted by anonymouse View Post

It's not a matter of it being, "bad (even though it's perfectly legal) just because you don't like it." It's a case of using patent law for a purpose contrary to it's purpose -- i.e., promoting innovation.

Then you don't understand the purpose of patent law.

Patent law is intended to spur innovation SPECIFICALLY BECAUSE the owner of an invention can do whatever they want with it. Whether you want to call them patent trolls or not.
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post #12 of 14
Quote:
Originally Posted by jragosta View Post


Then you don't understand the purpose of patent law.

Patent law is intended to spur innovation SPECIFICALLY BECAUSE the owner of an invention can do whatever they want with it. Whether you want to call them patent trolls or not.

 

No, patent law is intended to spur innovation because innovation is considered good for our society. Patent rights are granted because it's believed this is the best way to incentivize innovation. There is no interest in incentivizing a cottage industry of patent writing, nor is that beneficial to society. The interest is in innovation, and that's the only purpose for granting patents. If they don't result in innovation, they don't serve the intended purpose. If they stifle innovation, or siphon money from those investing it in innovation, then, they are contrary to the law's purpose.

 

 

Article I, Section 8, Clause 8 of the United States Constitution:

 

Quote:
To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

Edited by anonymouse - 1/24/13 at 2:06pm
post #13 of 14
Quote:
Originally Posted by anonymouse View Post

No, patent law is intended to spur innovation because innovation is considered good for our society. Patent rights are granted because it's believed this is the best way to incentivize innovation. There is no interest in incentivizing a cottage industry of patent writing, nor is that beneficial to society. The interest is in innovation, and that's the only purpose for granting patents. If they don't result in innovation, they don't serve the intended purpose. If they stifle innovation, or siphon money from those investing it in innovation, then, they are contrary to the law's purpose.


Article I, Section 8, Clause 8 of the United States Constitution:
Quote:
To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

You're misreading it. The latter clause is the independent clause. The first one is the dependent clause. The intent of the wording is that the purpose of granting exclusivity is to promote the progress of science.
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post #14 of 14
Quote:
Originally Posted by jragosta View Post


You're misreading it. The latter clause is the independent clause. The first one is the dependent clause. The intent of the wording is that the purpose of granting exclusivity is to promote the progress of science.

 

That's exactly how I'm reading it.

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