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Friday, March 02, 2007

i2 seeks patent license shake-down fees

A Spectator reader called my attention to this news yesterday. i2 Technologies is launching a patent licensing program to make available (for a fee) selected patents that do not apply to the company's supply chain management focus.

In other words, the patent program will NOT affect i2's current lawsuit against SAP, which is over one of i2's patents related to process planning, factory planning, sales negotiation and tracking, manufacturing allocations, and management of available to promise (ATP).

So what's the purpose of i2's patent licensing program? In one word, money. It appears that i2 has been applying for patents for general purpose approaches to system design, apart from its core expertise in supply chain applications. For example, the initial offering in i2's patent licensing program will be an i2 patent (US Patent No. 6,169,992) that relates to "the use of a Web browser utilizing an executable client application in order to enable interactive queries of a remotely located information repository."

i2's press release goes on to comment that the patent is relevant to Internet applications using Asynchronous JavaScript and XML technology (AJAX). AJAX is a web development technique for creating interactive web applications. AJAX makes web pages more efficient and responsive by exchanging small amounts of data with the server, so that the entire web page does not have to be reloaded each time the user makes a change."

Of course, i2's investors will cheer i2's move as a potential source of additional revenue. But, in my opinion, this program is another example of software patents going too far. AJAX technology is a hot topic in software development these days, as companies such as Google use it to make web-based applications much more user-friendly and efficient. For example, if you've clicked and dragged on a Google Map, you've seen AJAX in action.

Now, I'm not saying that Google Maps infringes on i2's patent. But I am saying that anyone using AJAX to access a remote database may now need to look at i2's patent claims. At what point do patents such as this one stifle rather than encourage innovation?

For more on the subject generally, see this Wikipedia entry on the software patent debate.

Related posts
SAP: If you can't beat 'em, sue 'em

by Frank Scavo, 3/02/2007 08:24:00 AM | permalink | e-mail this!

 Reader Comments:

Hi Frank,

Thank you for clearing up the differences between the patents involving in the i2 against SAP suit vs. the ones they are seeking to license to others...

well, i guess the debate has been going on for quite some time regarding the patentability of software methodologies. Aside from being an i2 investor, I still think that the patents are intelectual properties and need to be protected.

There's a reason why MSFT was sued in the US and EU for throwing its weight around to kill competetion, same happened in application software battleground after tech bubble bursted.

SAP and ORCL have been doing all kinds of "dirty tricks" toward smaller competitors to eliminate their existence altogather and i2 for one has suffered tremendously form the unfair practices of the two big ERP giants.

SAP engaged in a partnership with i2 in the late 1990s, short after it killed the partnership and bad-mouthed i2 about its financial problems, spreaded rumors in the marketplace to kill the competetion and went ahead helping themselves with all i2 patents and developed competetive products to compete with i2... same as Larry Ellison et al.

The lawsuit i2 filed against SAP in my opinion is totally justified and i2 has a very high chance to win the case according to people familiar with the case.

I believe enforcing the patents in court of law is the best way to encourage innovation and avoid the monopoly by unfair competition from big competitors.

Again, Thank you for your opinion.

George Tsai
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