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Old 02-08-2002, 09:16 AM   #1
cyrex
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Default 24/7 Media Slaps ValueClick with Suit

New York-based ad network and technology firm 24/7 Real Media (NASDAQ:TFSM) on Wednesday filed a patent infringement suit against rival ValueClick, (NASDAQ:VCLK) reprising the series of quarrels among the online ad servers and networks.

The suit alleges that Westlake Village, Calif.-based ValueClick's ad delivery system infringes on the patent that 24/7 Real Media holds for its system. ValueClick subsidiary Mediaplex -- acquired last year -- is also named in the suit.

The suit stems from 24/7 Real Media's -- then known as 24/7 Media -- February 1995 filing for patent protection for an "on-line interactive system for providing content and information to a targeted set of viewers." Exactly five years later, the firm received U.S. Patent No. 6,026,368.

"The patent that we're now asserting is ... in our view, the 'granddaddy' patent in the targeted ad serving area," said Bob Gunther, Jr., 24/7 Real Media's attorney and a partner at the New York office of Latham & Watkins. "Companies like ValueClick and Mediaplex that are doing sophisticated targeting and ad serving need a license under this patent."

24/7 Real Media had been hoping to secure a licensing arrangement with ValueClick, although negotiations to that end ultimately fell through, Gunther said.

"Our view is that under fair terms, we're willing to grant licenses, but the fact of the matter is we had a back and forth with them, and it didn't go anywhere," he said. "As a result of that, we were left with no choice but to enforce it by filing a lawsuit."

ValueClick representatives were unavailable for comment at press time.

The suit against ValueClick, in which the sector's largest player, DoubleClick, (NASDAQCLK) has a 15 percent stake, effectively picks up where a series of earlier lawsuits among the ad serving sector's biggest players left off.

In November 1999, DoubleClick sued smaller rival L90 (NASDAQ:LNTY) for allegedly infringing on its patent, No. 5,948,061, which it had received a month earlier. DoubleClick originally filed for patent protection of its "method for delivery, targeting and measuring advertising over networks" in October 1996.

A month after filing charges against L90, DoubleClick also brought Australian ad server Sabela Media to court on the same grounds.

One month later, 24/7 Media joined the fray, acquiring the Aussie ad company and, in March, filing its own patent suit against DoubleClick. Shortly thereafter, L90 and Sabela also sued DoubleClick, asking that a federal judge render the larger firm's patent "invalid and unenforceable."

All the lawsuits were settled under confidential terms in November 2000. As part of the settlement, the companies' suits cannot be re-filed with the same claims.

-----------------------------------------

Link: http://www.internetnews.com/IAR/arti...970881,00.html

This new development opens one more chapter in online ad industry, will see who will win my questions is: will this also somehow affect adtegrity and fastclick in near future?
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Old 02-08-2002, 09:54 AM   #2
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Default Re: 24/7 Media Slaps ValueClick with Suit

Quote:
Originally posted by cyrex
This new development opens one more chapter in online ad industry, will see who will win my questions is: will this also somehow affect adtegrity and fastclick in near future?
I'm not familiar enough with FastClick's targeting technology to speculate on whether or not it could also be affected, but since they do target in a variety of ways, they very well could be involved in negotiations presently.

Adtegrity, on the other hand, will remain entirely unaffected, since they're a sales - and not tech - firm. As far as I am aware, they currently employ Thruport's AdJuggler product to deliver ads, and have already proven that they can switch ad serving platforms (they used to use Spinbox) with minimal interruption to their business operations if needs be.

BTW, for thosse interested, details of the patent may be found here:
http://patft.uspto.gov/netacgi/nph-P...1&f=G&l=50&s1='6,026,368'.WKU.&OS=PN/6,026,368&RS=PN/6,026,368
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Old 02-08-2002, 10:03 AM   #3
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Default Re: Re: 24/7 Media Slaps ValueClick with Suit

So does that mean adtegirty dosent target the ads, or did you mean since they use AdJuggler they not going to get sued. Because if you meant the latest one even if its not their technology but they are just using it, they can still get sued. I would love to hear scotts (from adtegrity) opinions about this whole issue.



Quote:
Originally posted by Czar

I'm not familiar enough with FastClick's targeting technology to speculate on whether or not it could also be affected, but since they do target in a variety of ways, they very well could be involved in negotiations presently.

Adtegrity, on the other hand, will remain entirely unaffected, since they're a sales - and not tech - firm. As far as I am aware, they currently employ Thruport's AdJuggler product to deliver ads, and have already proven that they can switch ad serving platforms (they used to use Spinbox) with minimal interruption to their business operations if needs be.

BTW, for thosse interested, details of the patent may be found here:
http://patft.uspto.gov/netacgi/nph-P...1&f=G&l=50&s1='6,026,368'.WKU.&OS=PN/6,026,368&RS=PN/6,026,368
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Old 02-08-2002, 10:07 AM   #4
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One thing to note though, is that revecom and 2checkout are third party processors, and thus you are not really suppoused to have your clients' credit card number.
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Old 02-08-2002, 10:56 AM   #5
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I certainly don't have any details on the nature of the infringement claim here, but it seems unlikely that it will affect any of the companies we're involved with.

The link Czar provided covers what appears to be profile based targetting. We don't do anything with targetting at that sophisticated a level. It's unclear whether something as basic as Geo-targetting would be covered, but several of the claims in the patent seem overly broad to me, which would make them unenforcable.

We do use Thruport's AdJuggler. As a customer, rather than the technology owner, we would certainly have no exposure even if a court were to support the infringement claims. However, I have complete confidence that the Thruport team would vigorously and successfully defend themselves if necessary.

Bottom line, I think 24/7 is desperately flailing about for another revenue stream. This lawsuit is nothing more than an attempt to hold their competitors hostage with a patent infringement suit in order to force them to pay royalties.

I don't think it will work.

-Scott
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Old 02-08-2002, 01:50 PM   #6
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Hey czar, can you repost that link? I can't get the one you've listed to work.

This is certainly scary for me, as I wrote all our ad serving software and won't have a company like ad juggler to forward to. I don't target by profile at all, nor do i save any information on users, so I'm hoping thats what this is about.

I guess I will have to look into the details of this. I certainly don't want to be sued.

Last edited by clay; 02-08-2002 at 01:52 PM.
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Old 02-08-2002, 01:58 PM   #7
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Oops. Sorry 'bout that. Looks like the looong link was a little much for vB to handle.

Clay, you may find the patent by visiting this page:
http://patft.uspto.gov/netahtml/srchnum.htm
and pasting the number "6,026,368" into the search field.

Best of luck.
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Old 02-08-2002, 03:58 PM   #8
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These companies all keep suing each other for violating the other's [insert problem of the day here]. It doesn't seem like anything's coming from it, though, just more suits.
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Old 02-08-2002, 04:10 PM   #9
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It seems to me like a boardroom "oh no, we need money" "I know, let's sue ValueClick"..... thing to me. This does nothing but harm the online ad industry.
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Old 02-08-2002, 04:33 PM   #10
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thanks czar. Pretty confusing looking at the patent. ugh, so much lawyer talk. Finally, i got to the tables, which are somewhat understandable.

I may be wrong, but it looks to me that they are trying to lay claim to most any form of targeting other than by categories. The patent is so general that i think most any ad network would be in violation of it.

Here's a look at table7 from the patent.

TABLE 7
______________________________________
rule.sub.-- id unique identifier
target entity type
Subscriber, Location, or Time Period
target object type
base entity record, profile record,
or folder
target object id
unique identifier from the target
object table
priority integer between 0 and 100
target segment type
base entity record, profile record,
or folder
target segment id
unique identifier from the target
segment table
campaign id id of the campaign from the contracts
data base for which this rule was
developed
max. frequency
max. repeat
valid start date
valid end date


Looks like anyone with an ad network that has a campaign starting date, maximum exposures per user is in violation of this one. Furthermore, even using a weight system seems to be in violation.

To me, it looks like they are trying to patent ad serving as a whole, unless your picking out ads at random. Even billing on the results seems to be patented. IE, you track 1000 exposures and figure up CPM automatically. I don't see why they give people such general patents. Some of the things given in this patent had been used for years before the patent was given by probably anyone that has ever installed in home ad serving software.

I also seen a part where geo-targeting is mentioned. Is that nothing more than customer selection? I would think so. Choosing who you send ads to, is a right of a business i would think. It's like patenting the idea that you can only sell this item to people with blue shirts. And therefore, anyone who sells something to someone with a blue shirt is in violation.

In any event. I think if valueclick has been through negotiations with them, and they didn't pay there must be somekind of hole in it, or they don't believe the case would hold up in court.

I'm not going to worry about it. I think 24/7 is just at the end of the rope, looking for a free step back in. I don't see how this will ever hold up in court.

I'll put this one in the same category as the "freebie" scandal.
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Old 02-08-2002, 05:14 PM   #11
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I try to understand this.
Basiclly they are just targeting based on more rules,
So into the equesion you trow in the IP both for uniq and Geo, time of visit, Number of visits and more, and by this trying to deside what banner to serve.
That is soooo general that I am sure every body are doing the same or somthing similar.

I will not put it with the FreeBie one but I think that the patent need to be taken away from them as it's too general.

(I am not a lowyer or any thing close to this)


But if any one is willing to invest in a really new way doing the targeting process I have somthing I am holding in my pocket for some time now.
Problem is that I am afraid the system will need a IBM ASCI White to run.

Well, if you have $120Mil to invest (110 for the computer the rest to develop the system) feel free to call me.
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Old 02-08-2002, 06:23 PM   #12
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Quote:
Originally posted by sbrew

Bottom line, I think 24/7 is desperately flailing about for another revenue stream. This lawsuit is nothing more than an attempt to hold their competitors hostage with a patent infringement suit in order to force them to pay royalties.

I disagree with you Scott. I think that rather this is an indication that 24/7 media can better compete in the courts than it can in the marketplace.

Personally I think that all internet advertising companies are flailing and desperatley looking for another revenue stream. Protracted legal battles will just ensure that this sector will die so much sooner. Its really only a matter of time until both 24/7 and valueclick both fold.
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Old 02-08-2002, 06:33 PM   #13
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Quote:
Originally posted by Scuba
But if any one is willing to invest in a really new way doing the targeting process I have somthing I am holding in my pocket for some time now.
Problem is that I am afraid the system will need a IBM ASCI White to run.

Well, if you have $120Mil to invest (110 for the computer the rest to develop the system) feel free to call me.
Go ahead and apply for the patent now. By the time the patent is issued, you'll probably be able to run the system on a desktop PC!
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Old 02-08-2002, 07:00 PM   #14
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Well, they haven't really won anything just filed a suit... For all we know they might just slow Valueclick down a bit...
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Old 02-08-2002, 07:40 PM   #15
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Quote:
Originally posted by Anion



I disagree with you Scott. I think that rather this is an indication that 24/7 media can better compete in the courts than it can in the marketplace.

Personally I think that all internet advertising companies are flailing and desperatley looking for another revenue stream. Protracted legal battles will just ensure that this sector will die so much sooner. Its really only a matter of time until both 24/7 and valueclick both fold.
I'd have to disagree with you on the 2nd paragraph. And just because 24/7 is having a hard time on the marketplace, doesn't mean everyone is. I make profit each month. Not alot of profit(or as much as I'd like), but i do make profit. According to your thinking, wal-mart will be filling for bankruptcy next month, because k-mart did last week. Thats not at all how business works.
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