What's next — someone patenting the concept of a “buy-one, get-one-free” sales promotion?
Cisco Systems has been granted a patent by the U.S. Patent and Trademark Office for a system that provides video, voice and data over a unified network infrastructure. The patent essentially describes the “triple-play” service offers that pervade both the cable and telecommunications industries today.
U.S. Patent No. 7,075,919, granted to Cisco in July 2006, covers “a method for providing integrated voice, video, and data content in an integrated service offering to one or more customer premises,” including “receiving television programming from a programming source, receiving data from a data network and receiving telephone communications from a telephone network.”
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The patent was applied for in August 2000 by Sandstream Communications & Entertainment, a broadband Internet-protocol television services provider based in Lewisville, Texas, near Dallas. That company went out of business in 2002, after which Cisco acquired its intellectual property.
So what does Cisco plan to do with this patent? Apparently, not much. The company, in a statement sent to Multichannel News, said it won't “proactively” try to prevent other companies from using technologies described in the patent or force them to license it.
“Although Cisco is not aware of any industry standard that is captured by this patent on triple play, Cisco still plans to treat the patent in accordance with its past practices for patents that cover industry standards,” the company's statement said. “Namely, we do not intend to proactively enforce the patent to prevent others from using the technology or to collect a royalty. We expect that this policy will foster adoption of triple play to the benefit of the broadband industry and its customers.” Cisco declined to comment further.
The lead author listed on the triple-play patent is Tom Wendt, formerly with Sandstream, who went on to start Optical Entertainment Network, another Texas IPTV outfit. Houston-based OEN markets what it calls the “Triple Play Plus” bundle, which provides video, Internet and voice service to residential and commercial customers over fiber-to-the-home (FTTH) technology.
The patent specifies that the “integrated-service offering” be delivered via a common communications protocol, which is further specified to be Internet Protocol. It also covers the process of converting TV programming to a common format over a single network, as well as delivering conditional access to video on demand, pay-per-view video, audio and interactive gaming content.
Adopting a laissez-faire stance may be the safest route for the networking giant, according to industry analysts, who said Cisco would have a tough time trying to swing the legal bat on its triple-play patent.
The patent is extremely broad in its wording, which could make it difficult to defend in court. Moreover, Cisco would breed ill will among cable operators and other service providers — to say nothing of other equipment providers — if it tried to wring patent royalties from companies using triple-play systems, said Tom Nolle, president of CIMI, a telecommunications-industry consulting firm.
“It seems to me Cisco would be cutting their own throat if they tried to collect on this,” Nolle said. “I'm no patent attorney, but it seems almost impossible to me that this would stand a legal challenge.”
Nolle added that Cisco might view the patent as a defensive measure, to inoculate it against intellectual property claims concerning converged voice, video and data networking.
Other observers were similarly doubtful about the wisdom of Cisco attempting to capitalize on the triple-play patent. “It's better to put out a full solution with a wonderful set of products than it is to keep people out of a market for a relatively general patent,” said Eve Griliches, a research manager at research firm IDC.
Cisco does appear committed to pursuing “triple play” opportunities in the market, rather than the courts. In August it acquired Arroyo Video Solutions, a four-year-old IPTV startup that delivers VOD and DVR capabilities to various client devices, for $92 million in cash. Arroyo customers included Comcast, Time Warner Cable, Charter Communications and Cablevision Systems.
Last week, Charter confirmed it would build out its triple-play offerings using Cisco's uBR10012 Cable Modem Termination System and ONS 15454 multiservice transport platform.
“The growth of high-speed data, voice, video-on-demand and Gigabit Ethernet multimedia services make the IP delivery network the most critical technology in Charter's delivery of rich content to our customers,” Marwan Fawaz, Charter's chief technology officer, said in a news release.