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Newest Amazon.com Patent Concerns Industry
Steven M. Zeitchik -- 3/6/00
The e-retailer's action also angers tech community
The U.S. Patent Office accepted Amazon.com's application to patent its affiliates program late last month, eliciting a backlash from the Internet community.
The patent was given for what is officially called the Associates Program, which allows for marketing partners to receive commissions on traffic driven to the Amazon site. The patent abstract stresses the technological aspects of the program. It reads, in part, "The system includes automated registration software that runs on the merchant's Web site to allow entities to register as associates. Following registration, the associate sets up a Web site (or other information dissemination system) to distribute hypertextual catalog documents that include marketing information (product reviews, recommendations, etc.) about selected products of the merchant."
Amazon.com has yet to sue any fellow e-retailers on the basis of this patent, although experts point out this could easily be the next step. Among the potential targets is Barnes&Noble.com, which counts 300,000 members in its Affiliates Program, including high-visibility sites like Britannica.com, AskJeeves.com and Condenet.com.
This is the second patent controversy in which Amazon has been involved recently. In the fall, it endured criticism after securing a patent for one-click ordering, which it then used to sue Barnes&Noble.
com. A preliminary injunction now prevents bn.com from employing one-click ordering. As for the most recent controversy, a bn.com spokesman would say only, "We are reviewing the patent and haven't come to any conclusion." The patent could force companies like bn.com and others to change their programs cosmetically, if not fundamentally. Experts also note that the patent may have a chilling effect on these companies' ability to sign up new affiliates.
Within hours of the news, the high-tech community, expressing its opinion in venues like the San Jose Mercury News, skewered Amazon for attempting to turn what it says is a basic marketing program into a proprietary, revenue-generating process. Publisher Tim O'Reilly, of O'Reilly & Associates, posted an open letter to Jeff Bezos on his site, saying, "[as] you've now also received a patent on your affiliates program as well as several other critical patents relating to e-commerce, we urgently request that you clarify your intentions with regard to software patents, and avoid any attempts to limit the further development of Internet commerce on the basis of the patents you have already been awarded." At press time, the letter had more than 7,000 signatures.
In a letter posted after the one-click controversy, O'Reilly pointed out the irony of a suit coming from a company that itself benefited greatly from the open-source revolution. In his latest letter, O'Reilly wrote, "Your patent fails to meet even the most rudimentary tests for novelty and non-obviousness to an expert in the field," adding, "If you use these patents offensively, as you have done in obtaining an injunction against Barnes & Noble's use of one-click ordering, you are striking a blow against continued innovation in the medium that has proven so successful for you." According to O'Reilly, Bezos responded, but the publisher refrained from posting the response out of privacy concerns.
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