The Internet has Done More Than Contribute to a Booming Economy. Its Impact is Also Being Felt at the U.S. Patent Office.

By Mike Foley

What can be patented? These days, the answer is wide-open.

Back in 1998, a bank method used to manage mutual funds for customers received a patent and set a major precedent for the Information Age. With the granting of that patent and its ultimate approval by an appellate court, the "abstract" nature of patents was born.

When such ideas, concepts and methods can be patented, the business world, especially companies working in computer and Internet-based industries, began scrambling to gain exclusive rights to new technology and business methods. For example, both established and startup companies operating on the World Wide Web have begun seeking patent protection on their website models and processes. Patents have been issued on Internet voice-mail technology, message delivery and even mouse-click technology.

Amazon.com, for instance, recently secured a court order prohibiting Barnes and Noble from using a one-click ordering system (like Amazon's) on its website. And British Telecom now claims to have a patent on hyperlinks, the methods that allows Internet surfers to move from one website to another. And after the company began seeking licensing fees for the technology, lawyers for several companies were hurriedly studying the issue, ushering in what may be the first major litigation resulting from the dot-com patents.

In addition, such patent pursuits are quickly changing the face of the patent application process. Since such technology cannot be presented with a detailed drawing as can most patentable products, patent reviews are taking much longer, up to 20 months in some cases. And although the U.S. Patent and Trademark Office currently employs 38 examiners exclusively for such abstract patent applications, Congress has indicated a desire to cut the PTO budget, making the future murky, at best.

Even worse, many companies and even legal experts consider such patents to be absurd, even accusing the growth in such tech patents of stifling business and innovation. Still, it seems likely that such patents are here to stay and that the current "mad rush" climate will continue. Whether defending one's Internet territory or establishing a niche in the market, companies will continue using the patent system to ensure their ongoing business success. 

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