Microsoft, Intel Building Up Patent Portfolios

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—more 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.