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Bad Reporting in Progress II - Or How MS *Still* Didn't Invent the iPod

Last Friday I gave Wizbang readers a heads up on how bad reporting was happening in real time. It was about the case of Microsoft supposedly patenting the iPod technology after Apple shipped it.

As I said at the time, the Microsoft application (and yes dear readers, it is still just an application) will obviously be rejected because (among other reasons) you can't patent something that someone else already ships.

I said Friday, we could watch the story grow from the original report on a rumor site to techweb to the The Independent who even made up bogus numbers to make the story more dramatic. Now we can follow the story another step with another reporter embellishing the story along the way...

Report: Microsoft to profit from iPod

LONDON, Aug. 13 (UPI) -- Microsoft's Bill Gates could make a killing off of rival Apple Computer's iPod, The Independent Online reported.

Apple might have to pay Microsoft royalties for every iPod it sells, the Independent said, because Microsoft beat Steve Jobs' company to the patent office and secured a crucial patent on technology used in the iPod. [Editors note- They Microsoft DID NOT "secure" a patent, it's still an application.] ...

The paper said iPods account for three of every four portable music players bought in the United States, and represent almost one-third of Apple's sales. One analyst told the Independent Apple will sell 25 million iPods this year -- bringing the total sold in the four years it has been on the market to 35 million. ...

The bottom line: Apple could have to pay Microsoft a license fee of up to $10 for each iPod.

Notice anything missing from that last line where the reporter offered us "The bottom line" on it? How about the words "according to." As in "Apple will have to pay $10 per iPod according to someone other than the reporter." This reporter gets it from The Independent and embellishes it some more as he retells it. This is no better than backyard gossip at this point.

The "Bottom Line" here is that reporters are just making stuff up! Who are the industry experts who came up with this $10 figure? Watch this figure take its place in mythology:

Apple Patent Loss May Earn Microsoft $10 Per iPod Scottish Daily Record

Apple has so far sold more than 21 million of the pocket-sized players. In the past year alone, the company sold 18 million. Reports indicate iPods account for three of every four portable music players bought in the United States, and represent almost one-third of Apple's sales.

Computer giant Apple (Nasdaq: AAPL) may be forced to pay royalties to arch-enemy Microsoft (Nasdaq: MSFT) for every iPod it sells.

A patenting blunder means Bill Gates' firm could rake in as much as US$10 from every one of his rival's music player that is sold.

According to????

Apple Cock-Up May Earn Microsoft $10 Per iPod
Mike Slocombe

Apple may be forced to shell out royalties to Microsoft for every single iPod it sells after it emerged that Microsoft was first to file a crucial patent on technology used in its iPod. ...

The dispute could lead to Apple having to pay a licence fee for the technology of up to $10 a machine

According to???

After extensive searching I can find no industry analyst who takes this seriously... In fact there have been a few reporters who actually interviewed people rather than make stuff up and they present a completely different picture:

Will Microsoft Get a Bite of Apple's iPod?

Reports of Apple's (Nasdaq: AAPL) inability to patent the interface software...[snipped]

However, legal experts and industry analysts highlighted the lengthy process and potential hurdles to a Microsoft claim on the MP3 music organizer and player, and indicated that an AppleInsider and subsequent reports make a bigger story of what is standard patent procedure.

"All that has happened is Apple's patent has received final rejection, and that is a non-event," patent attorney and Townsend and Townsend and Crew partner Roger Cook told MacNewsWorld. "This is really making a mountain out of a molehill." [Ya don't say -ed] ...

There has also been much made of the fact that part of the rejection was because of an earlier patent application that links back to Microsoft. Reports stated that the software giant might be entitled to as much as US$10 per iPod device, but Cook again said the facts were being added up incorrectly.

Cook called the prior patent application "again, a non-event," and stressed the difference between Microsoft's patent application and any kind of patent claim, which has not happened.

"It doesn't even rise to the level of [patent] interference, yet," he said.

At least someone bothered to ~you know~ do some reporting and interview someone rather than just make stuff up.

After reseaching this post for a while, I was almost scared to click the link when I found this headline, "The Real Deal On Microsoft's Playlist Patent" but it turns out that Forbes did an excellent job. They actually read the Microsoft application(!) and found that it might not even overlap.

The Real Deal On Microsoft's Playlist Patent
...The reports suggest that some component of the iPod interface may be infringing on Microsoft's patent, and that Apple may be forced to pay royalties to Microsoft on millions of iPod units sold.

In truth, the patents in question might not even be directly related.

"Some people say patents are overlapping, and I'm not sure that's accurate," says Kaefer. "The characterization of the patent is not spot on."

Indeed, news articles suggested that Microsoft's patent surrounds the iconic iPod clickwheel. But its patent has to do more with the organization and delivery of digital media items.

This is a must read if you really want to know what this is all about.

And lastly dear reader, if you are not convinced yet that the media is completely full of bull, I give you the most obvious way to fact check this story. If the reports are true, Apple may have to give Microsoft a quarter of a billion dollars cash and untold billions in the future. Then somebody explain this:

Go ahead, click on it to see it full size... While the technology publications are reporting this as dooms day for Apple, it was the business publications getting the story right. This story was first published on Wednesday and really broke over the weekend. From Wed to Monday, Apple stock was up 10% and Microsoft was down.

Clearly Wall Street knows the whole thing is bogus. Of course if you read Wizbang, you knew it too.

Update Infoworld is figuring it out too.


Comments (22)

THANK YOU for this posting.... (Below threshold)

THANK YOU for this posting. I have been trying to tell people in various comments sections that this story is false by talking about the patent process in general and "prior art". I'm glad someone took the time to actually dig into the facts and history.

Two words: Prior Art.... (Below threshold)
Toby928:

Two words: Prior Art.

http://www.tms.org/pubs/journals/JOM/matters/matters-9106.html

To wit: The prior art is defined by Title 35, United States Code, Section 102, which states: "A person shall be entitled to a patent unless...." This language is followed by a series of definitions, the most important of which are summarized in the following.

First, a person is not entitled to a patent if the invention was "known or used by others in this country, or was patented or described in a printed publication in this or a foreign country" before the date of invention by the applicant for the patent.

Tob

File this under “why I dist... (Below threshold)
jmaster:

File this under “why I distrust the media, Chapter 3”.

I see how they can completely screw up things like this, which I really understand (I’m an electrical engineer with 10+ patents myself).

So there’s no way I’ll trust them to report on something I don’t understand.

The "Prior art" words don't... (Below threshold)
George:

The "Prior art" words don't apply to Microsoft; they apply
to Apple. Apple's patent was rejected because, apparently,
Microsoft had already submitted a patent application with
the same, or similar, claims.

Contrary to the claim in this blog, it is indeed possible
to patent something that somebody else is already
shipping. The important factors are the invention
date and the date the invention was disclosed publicly.
Once an invention is disclosed publicly (as is the
case with shipping iPods), you still have a year to
patent the invention.

The fact that Apple's patent was rejected is not
trivial. In essense, it suggests that Apple may
be using a technology that may very likely become
a Microsoft patent. It could be serious; it could be
nothing. If Apple can show that they were using
the technology prior to the Microsoft application
without any knowledge of the Microsoft technology,
they could be exempt from licensing fees -- but
Microsoft would still own the patent which it could
license to others.

If Apple can't show that, there could be some licensing
fees involved or maybe not. It could possibly result
in some sort of cross-licensing agreement where Apple
will allow MS to use some of its patents in return for
using the MS patent(s).

Just a follow-up, if you re... (Below threshold)
George:

Just a follow-up, if you read the legalese posted by Toby928,
it says the invention is prior art if it is disclosed publicly
"before the date of invention."

The fact that iPods are shipping with the technology
does not in any way suggest that MS did not invent
the technology at a prior date. Do not confuse
patent application date with the date of invention.
I see nothing here that would hinder Microsoft from
obtaining the patent.

Georoge how do you reconsil... (Below threshold)
Paul:

Georoge how do you reconsile the fact it was hardly "novel" if it is a shipping product?

>The "Prior art" words don'... (Below threshold)
Paul:

>The "Prior art" words don't apply to Microsoft; they apply to Apple.

BTW- That's 100% wrong. But I'll leave the fun for some of the other commenters.

Paul:It was "novel" ... (Below threshold)
George:

Paul:
It was "novel" when it was invented; not after it shipped.
You are applying the novel requirement to the
wrong timeframe.

George: You seem to be unde... (Below threshold)
Cousin Dave:

George: You seem to be under the impression that the only possible reason for Apple's patent application to be rejected is that Microsoft's work was accepted as preceding Apple's. I see two problems with that assumption:

(1) In order to make a claim of previous invention (since they had neither disclosed nor shipped any product using the technology prior to the IPod's introduction), Microsoft would have to produce some pretty solid documentation of their prior work on the subject. Typically, this means lab notebooks -- with each page signed, dated, and witnesses, and with some kind of notary seal. The notebooks have to show the exact date of invention, the progress of development of the invention, and the technical details of how the invention works, Just an assertion of "we invented it first" backed with a few memos or e-mails is not going to fly. Now, I'm not saying that Microsoft doesn't have this evidence, but if they do, they have yet to show it.

(2) More than likely, the reason Apple's patent was rejected is that the matter covered by the application is not patentable, because it isn't novel. Either it's already known to the trade, or it is something that would be obvious to anyone in the trade. The Patent Office has been hammered, and rightfully so, concerning the garbage software patents that it has granted over the last fifteen or so years. (See http://www.m-cam.com/patentlyobvious/20010406_britishtelecom.pdf for an incredible example -- British Telecom trying to enforce a patent on the concept of linked lists, a technique which has been known to the programming profession since the early 1960s. Not only that, but they are also trying to extend the scope of the patent to include hyperlinks.) If it is true that Apple's patent covers something that is obvious, then I applaud the Patent Office for rejecting it. This implies that if Microsoft's patent is similar as to the material covered, it will be rejected too.

"The fact that iPods are sh... (Below threshold)
Toby928:

"The fact that iPods are shipping with the technology
does not in any way suggest that MS did not invent
the technology at a prior date."

Very good point George. It could be true that MS invented IPOD technology before Apple and simply didn't market a product. What does that mean for their 'window of opportunity' to submit a patent. Should they have disclosed their idea by publication at some earlier date?

Tob

I am not now nor have I ever been a member of the bar.

you can't patent somethi... (Below threshold)
mcg:

you can't patent something that someone else already ships.

Nonsense! For the purposes of a patent application, ship dates are irrelevant. The dates of invention and application (which produces a public disclosure) are what matter.

Oops, someone else already ... (Below threshold)
mcg:

Oops, someone else already pointed this out. And the ship date does indeed matter, but only because that is a point of public disclosure. Anyway, my point is that the fact that someone else ships something is not an automatic disqualification for a patent.

OK, I hate looking like I d... (Below threshold)
mcg:

OK, I hate looking like I disagree with the whole of an article when I'm just picking a nit. Let me be clear: great work Paul.

"You seem to be under the i... (Below threshold)
George:

"You seem to be under the impression that the only possible reason for Apple's patent application to be rejected is that Microsoft's work was accepted as preceding Apple's."

I am under no such impression.

The reason is that Microsoft's patent application preceded
Apple's patent application. You can't patent something that
someone else has already patented. Right now, that is
Apple's problem.

And, although they are probably irrelevant, I will address
your two points:
(1) Microsoft apparently does have evidence of work on the
subject dating back to 2001 (see the TechWeb article).
(2) The technology is apparently patentable; MS got
a patent on it.

This is an example of why getting your patent application
to the patent office is so important. You want to nail it
down before somebody else starts making the same or
similar claims. But you don't want to patent your
invention too soon as it reveals your technology and
starts the clock on a finite window in which the patent
is enforcable. It is a dilemma.

This and Paul's previous po... (Below threshold)
JimK:

This and Paul's previous post on the subject should be required reading at journalism schools the world over. Don't think for a second this phenomenon is limited to the techweb.

A publicist once advised me that one of the best things I could do anytime I am even peripherally involved in any story that gets ANY press attention is get my side out FAST and in public...and make sure there's a hook. Because the splashier, sexier, FASTEST story leads, and if it's mine...I win the battle of public opinion.

Fascinating to watch...horrifying to contemplate this kind of thing happening with important stories like...oh, I dunno...the war, maybe? Supreme Court nominees? The president?

Paul, I give you a lot of grief around here, especially over Apple stories, but this is EXCELLENT work. You could not have covered this better...tracking the changes and alterations so clearly illustrates your initial point that no one can argue against it. It's simply obvious that the story, like so many others, is growing like a game of telephone.

Oh, another thing: I just w... (Below threshold)
JimK:

Oh, another thing: I just went and re-read the original rumor story. Platt's patent is *also* in application from what I read. Neither Platt nor MS has a patent yet. Or am I reading it wrong?

George, I'm sorry but you c... (Below threshold)
Paul:

George, I'm sorry but you completly discredited yourself.

>(1) Microsoft apparently does have evidence of work on the
subject dating back to 2001 (see the TechWeb article).
>(2) The technology is apparently patentable; MS got
a patent on it.

#1 The Techweb artice was riddled with errors. Why can it be trusted?

#2 You apparently don't understand the difference between an appilication for a patent and having been awarded a patent. For about the 15th time, MICROSOFT DID NOT RECEIVE A PATENT. They have APPLIED for a patent and it's been rejected so far. (They are appealling)

Your blinding insisting they did get a patent will not change reality. Please, before you dig yourself any deeper, please take the time to read the post, I linked the application not once but twice.

Further you have said that Prior Art does not apply to Microsoft. I don't know how to argue that point. You either have no understanding of what prior art is or your suffer from delusions.

Please read my first post where I link a prior art explainer.

I welcome your input, but so far it is nonsensical

Yeah, I just noticed the se... (Below threshold)
JimK:

Yeah, I just noticed the sentence that answered my last question was...right here in Paul's original post.

So I was reading it right AND I need to read more closely.

Paul:Yes, I did mi... (Below threshold)
George:

Paul:

Yes, I did misstate that MS got the patent. I actually caught
that after I wrote it and considered correcting it but didn't
consider it germane. Just reword "got a patent on it" to
"got a patent application accepted for it" and it holds true.

Microsoft applied for a patent on this type of user
interface and the application was accepted. Apple applied
for the patent later but it was rejected on the basis that
MS had already filed for it.

Why would the patent office accept an application
for a patent that has already been applied for?
Simply put, Apple was too late. I sense you're having
trouble accepting this.

I guess the other item in debate is what is considered
prior art. When a new technology goes into production
and begins shipping, legally speaking, it is not instantly
prior art. By U.S. patent law, the inventor still has one
year to apply for a patent on a technology after it has
been disclosed publicly (by the way, did you notice
that Apple submitted its full patent application 11
months after the iPod was introduced?). If MS was
working on this technology, they had the same
window to apply; they did it and they did it before
Apple.

I doubt there is much Apple can do at this time
to stop MS from getting the patent short of
discovering that MS did something illegal to
obtain it.

A lot of inventors lost out because of poor timing.
Who invented the telephone? Alexander Graham
Bell or Elisha Gray? Two hours made the difference. See:
http://www.legalzoom.com/articles/article_content/article13756.html

>Yes, I did misstate tha... (Below threshold)
Paul:

>Yes, I did misstate that MS got the patent. I actually caught
that after I wrote it and considered correcting it but didn't
consider it germane.

You didn't consider that germane? I'm sorry George I just had to pick myself up off the floor, I fell down laughing.

Should I even read this rest??? (sigh, I'm a glutton for punishment) lemme go read the rest...

>Just reword "got a patent on it" to
"got a patent application accepted for it" and it holds true.

Oh Geeze... Say good night George. Anyone who pays the fee gets the application accepted. You know nothing of what you speak.

Do me a favor, go spend some time with google or at uspto.gov and come back when you have any clue what you are talking about.

I'm not even going to waste my time reading the rest.

You're a troll -- and not even a good one.

Awww Damn, I finished readi... (Below threshold)
Paul:

Awww Damn, I finished reading him and now my brain hurts....

A lot of inventors lost out because of poor timing.
Who invented the telephone? Alexander Graham
Bell or Elisha Gray? Two hours made the difference. See:
http://www.legalzoom.com/articles/article_content/article13756.html

George, George, George... What you don't know about patents could fill buckets. Why not follow a real link.

The Telephone and Patent Issues

"But Gray allowed his idea to slumber, whereas Bell continued to perfect the apparatus designed by Gray. An official at the patent office later admitted to selling Gray's idea to Bell's lawyers for money. Gray never knew this. However, when Bell achieved an unmistakable success, Gray brought a suit against him, which resulted in a compromise, one public company acquiring both patents."

Good night George

The Microsoft patent applic... (Below threshold)
Edward:

The Microsoft patent application is for "Auto playlist generation with multiple seed songs". Does the iPod have this feature? Did it have this feature in shipping products before May 2002?

The existance of the iPod as a product on its own before Microsoft filed the patent does not count as prior art if the iPod does not contain an implementation of the technique that is being claimed.

As far as I know neither iTunes nor the iPod contain this technique. The closest thing I've seen was in the new Napster store, where a "Radio" playlist of streaming tracks from the store is generated from looking at the tracks already in your collection.

As far as Microsoft are concerned thier application had nothing to do with the iPod at all. It is only the later claim by Apple that links this software technique with the iPod.




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