New Digital Media Patent Could Upset Apple Cart

ZapMedia Services, which owns the patent for what some view as a digital rights management platform, has put it up for sale.
But even after the patent changes hands, for a company to successfully enforce a patent, it must withstand challenges, according to John Ward, partner at patent strategist Greenberg Traurig LLP. Many times disputes are settled with reasonable royalties, he said. It's a cost of doing business.

Maybe so, but Ward seemed most impressed that ZapMedia's patent dates back to the fall of 1999, two years before the birth of Apple Computer Inc.'s iPod. CEO Steve Jobs unveiled the iPod on Oct. 23, 2001, as a Mac-compatible product with a 5-GB hard drive that put 1,000 songs in your pocket, according to Wikipedia.

"The patent seems fairly broad and could potentially apply to some companies providing downloadable music and movies," Ward said. "When you enforce a patent there are many ways to interpret the actual terms of the patent, which can narrow the scope and present obstacles to enforce."

A diagram in the patent describes the business model and the method in which content would flow from multiple media providers through an Internet portal and to consumers. On the surface, some industry experts believe the drawing appears similar to the distribution model used by Apple's iTunes Music Store, RealNetwork's Rhapsody, MTV/Microsoft's URGE, Napster, MSN Music, Wal-Mart Music, as well as movie download sites Vongo, CinemNow, MovieLink and others.

The patent is owned by ZapMedia Services, successor to the assets of ZapMedia Inc., a privately held $30 million funded Atlanta-based start-up that developed the technology. In its heyday, ZapMedia co-branded products and services with others, such as Microsoft Corp., and inked a $270 million deal with media conglomerate Gannett Co. Inc. ZapMedia focused on convergence technology, bringing custom entertainment to consumers. The goal was to allow consumers to access movies, music, video via the Web, as well as play CDs and DVDs through their existing televisions and stereos. The ZapMedia "ecosystem," developed in-house, consists of the ZapStation hardware reference design (device), ZapMediaEngineSM (software), and the ZapMedia Entertainment Service (portal).

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