[Ecommerce] Reform of patent system?

[Manon Ress]

Microsoft, Intel Build Up Patent Portfolios

By Alexander Wolfe Fri Apr 29, 6:17 PM ET
http://news.yahoo.com/news?tmpl=3Dstory&u=3D/cmp/20050430/tc_cmp/162100324

Patents issued this week to Microsoft Corp. and Intel Corp. highlight
the intellectual-property imperative that's driving technology
powerhouses to aggressively build up their patent portfolios.

Microsoft received U.S. patent 6,886,132 for its method of creating an
MHTML file, which is used to attach Web pages to an e-mail message.

Over at Intel, the semiconductor giant was awarded U.S. patent
6,886,180. The invention takes the functions of a standalone, broadband
cable-modem and implements them on a personal computer.

The two patents provide just a small snapshot of the innovations the two
companies have shepherded through the process at the U.S Patent and
Trademark Office. Intel this week received 28 patents, ranging from a
novel heatsink assembly to a method for making a photolithography
mirror. Microsoft's week saw it snare 13 patents, encompassing
inventions from an MPEG sub-sample decoder to a keyboard with an
improved numeric section.

For those keeping a scorecard, such activity translates into hefty
growth in the respective companies' annual portfolios. Microsoft
received 520 patents in 2003 and 659 in 2004. So far this year, it has
garnered 176, which puts it on a pace to slightly exceed its total of
two years ago.

While software patents have been on the increase, the numbers from
hardware-centric Intel dwarf those from Microsoft. Intel earned 1,602
patents in 2003; 1,607 in 2004; and 482 during the first three months of
2005.

Yet the flip-side of such individual successes is an overall patent
system that's swamped by too many filings and too little funding.
Indeed, Congress is poised to enact legislation to reform the
215-year-old patent process. Both Intel and Microsoft support the
reforms, which they say are needed to minimize the potential for abuse
of the patent system.

"You have to have a system that actively benefits innovation," David
Simon, Intel's chief patent attorney, said in an interview. "You have to
ask whether models that were originally developed going back into the
1600s needs changing. Will the legislative reforms that we're advocating
go a long way towards helping things? We think that they will."

Specifically, Simon, who testified Monday before the Senate Judiciary
Committee's intellectual-property subcommittee, is seeking reforms which
will cut down on poor-quality patents. He also wants to reduce the
number of cases brought by companies he said are looking for a quick
buck by acquiring patents and then seeking settlements from those they
claim are infringing. Simon testified as a representative of the
Business Software Alliance; along with Intel and Microsoft, that
industry lobbying group counts among its members Adobe, Apple, Dell,
Hewlett-Packard, IBM, Sybase, and Symantec.

Simon believes legislation will emerge from Congress in the next year or
two "We're playing a very active role in that debate," he said. "It's a
very hot issue right now in Congress."

Similarly, Microsoft supports patent reform. "We at Microsoft believe
that important improvements should be made in the U.S. patent system,"
Microsoft general counsel Brad Smith said in a speech to the American
Enterprise Institute on March 10, according to a transcript provided by
Microsoft. "Our patent system is being flooded with new patent
applications and an explosion of sometimes-abusive litigation."

Microsoft and Intel also want the patent office to be better funded, in
hopes this will enable a larger cadre of better-trained examiners to
filter out unworthy patents. Indeed, there's a general consensus that
the rising tide of software patents in recent years overwhelmed the
patent office.

"I don't really see more patents that are invalid today than there were
five years ago," Rich Belgard, a computer consultant and patent expert,
who's an IEEE Fellow and a past chairman of the Association for
Computing Machinery 's special interest group on Microarchitectures,
said in an interview. "They're just kind of a different flavor=97more
software and method-oriented patents. Companies like Microsoft have a
new philosophy on patents; they're patenting a lot more."

Microsoft's patent 6,886,132, which it received Tuesday for an invention
entitled "Method and system for packing and unpacking Web pages" into an
e-mail-friendly file format, called MHTML, certainly falls into that
category. As Belgard puts its, "This is all new stuff; there were no
packed MHTML files until fairly recently."

MHTML, which was standardized by the Internet Engineering Task Force in
1999, specifies a format for attaching Web pages to an e-mail message.
MHTML itself stands for "MIME Encapsulation of Aggregate HTML
Documents." MIME, the acronym within the acronym, is Internet jargon for
multipurpose internet mail extensions.

"Why would anyone care about this?," said Microsoft spokesman Sean
Sundwall. MHTML. "Well, a lot of e-mails like Microsoft Outlook have the
ability to view e-mails in HTML format. And what MHTML allows you to do
is allows you to include links to other things on the Internet from
within an e-mail. What this patent covers is certain ways of doing
that." Sundwall was careful to note that Microsoft isn't attempting to
patent the MHTML standard itself, just for a specific way to create an
MHTML-compliant file.

Belgard agrees with that assessment. "It's certainly interesting," he
said. "MHTML is a standard, but to implement it doesn't violate that
standard. They're not patenting MHTML. They're patenting a specific
methodology for packing a file. It looks like a flowchart for going
through HTML to look for these reference files and pulling them in."

Intel's patent 6,886,180, entitled "Implementing cable modem functions
on a host computer," may be an example of an idea which looked good at
the time it was filed in August 2000. However, in the nearly five years
the invention took to wend its way through the patent office, the
technique for taking a standalone, broadband cable-modem and using a PC
to do the job instead has become less relevant.

"Back in 1997-2000, cable modems were expensive and the bill of
materials included a lot of memory and other components that already
existed in any PC," Dmitri Loukianov, an Intel engineer who is one of
the two inventors named on the patent, said via e-mail. "We wanted to
make broadband connectivity for PCs cheap and ubiquitous." Perhaps
because the prices of cable modems have fallen so sharply, to less than
$100 today, nothing seems to have come of the technology. "The patent
describes Intel's implementation of the partitioning between the
software running on [a] PC," Loukianov explained. "However, later Intel
decided not to productize these modems under Intel's name. I am not sure
if and how we are going to use this technology in the future."

Examining any two just-issued patents highlights what a hit or miss game
the process of invention can be. As for Microsoft's better numeric
keypad, which was another of the 13 patents the company received this
week, it certainly addresses an issue to which all PC users can relate.
"The NumLock key is rarely used and is engaged by accident more often
than intentionally," the patent description notes, and goes on to
describe a more convenient layout to prevent that problem.












Manon Anne Ress
manon.ress@cptech.org,
www.cptech.org

Consumer Project on Technology in Washington, DC PO Box 19367,
Washington, DC 20036, USA Tel.:  +1.202.387.8030, fax: +1.202.234.5176

Consumer Project on Technology in Geneva, 1 Route des  Morillons, CP
2100, 1211 Geneva 2, Switzerland. Tel: +41 22 791 6727

Consumer Project on Technology in London, 24 Highbury Crescent, London,
N5 1RX, UK. Tel:+44(0)207 226 6663 ex 252. Mob:+44(0)790 386 4642. Fax:
+44(0)207 354 0607






--
Manon Anne Ress
manon.ress@cptech.org,
www.cptech.org

Consumer Project on Technology in Washington, DC PO Box 19367,
Washington, DC 20036, USA Tel.:  +1.202.387.8030, fax: +1.202.234.5176

Consumer Project on Technology in Geneva, 1 Route des  Morillons, CP
2100, 1211 Geneva 2, Switzerland. Tel: +41 22 791 6727

Consumer Project on Technology in London, 24 Highbury Crescent, London,
N5 1RX, UK. Tel:+44(0)207 226 6663 ex 252. Mob:+44(0)790 386 4642. Fax:
+44(0)207 354 0607