Now, Amazon.com is hoping to patent a technique for parceling out Web advertising space through competitive bidding.
In an application made public by the U.S. Patent and Trademark Office Thursday, the online retailer is seeking approval for a patent covering a “method and system for allocating display space.”
The application, which lists Amazon CEO Jeff Bezos as an inventor, would cover a system through which a website receives multiple bids for advertising space, chooses one bidder, then posts the advertisement online. The proposed patent would also cover a method of selecting bids targeted to website users with specific interests.
The proposal marks Amazon’s latest public foray into the controversial realm of so-called business-method patents, which cover a process rather than a specific device or technology. In 1999, the company received approval for a patent for “one-click” shopping, a method for making a purchase over an electronic network using a single action, such as the click of a mouse.
Although Amazon has had success in the past getting a fairly broadly worded patent approved, Wayne Tang, a patent attorney at Mayer, Brown, Rowe & Maw, says it’s unlikely the latest application will be granted in its current form.
“Usually the patent examiners will require some change to the claims,” Tang said. Often, the examiners will object to language that could make the scope of the patent overly broad.
Another obstacle for Amazon is the heightened level of scrutiny examiners now devote to business-method patent applications, said Rajiv Patel, a partner in the patent group at Fenwick & West. Examiners are now apt to conduct broad searches for prior publications that contain the same ideas as those in a patent application.
The policy of intensified scrutiny came in response to criticism that companies were using broadly worded patents to demand licensing fees for practices that had long been in the public domain.
One well-known case involved a claim by British Telecom, which developed and holds a patent on the hyperlink technology used to direct Web users from one site to another. A federal judge tossed out a case filed by BT against Internet service provider Prodigy in August, ruling that the telco’s claims were without merit.
Another recent case involves SBC Communications, which sent letters to more than 20 websites earlier this year claiming that it holds a patent on a popular website design format and seeking licensing fees.
Amazon declined to say what it would do with its advertising-related patent, if granted. “We don’t disclose what we may or may not do,” said Amazon spokesman Bill Curry.
If past actions are any indication, the company may try to enforce its ownership of the ad-related patent if it’s granted.
Amazon was fairly aggressive in attempting to enforce its one-click patent. Three weeks after getting the patent, the company sued rival Barnesandnoble.com for using an “express lane” feature on its website that allegedly infringed on Amazon’s one-click patent. The companies settled the dispute last year, without disclosing terms, after a protracted legal battle.
In a discussion thread on Slashdot.org, many posters were concerned about the breadth of Amazon’s latest patent application. Some worried that, if granted, the patent would make Amazon the only company legally permitted to collect bids for banner ads.
Tang, however, believes it’s likely Amazon wants the advertising patent more as a defensive measure to ward off lawsuits from other companies claiming proprietary ownership of similar methods. It could also try to seek licensing fees, but would have to be careful not to provoke a potential licensee into suing to get the patent invalidated.
Either way, Tang said, it’s probably not a pressing issue for either Amazon or other companies that might be affected by the patent. In many cases, it takes years for examiners to approve a business-method patent.