In 2003 Acacia Media Technologies sent letters to numerous adult Internet sites and radio webcasters demanding a license fee for the utilization of streaming technology. At that time, the California-based holding company Acacia Research claimed to hold patents on streaming, downloading and just about every form of digital audio and video distribution out there–including pushing MP3s from peer-to-peer groups, streaming newscasts from Internet radio sites and delivering movies through cable networks. They attempted to secure license fees from streaming sites, including Internet radio stations such as Radioio and Radio Free Virgin. They did manage to get some of the stations to sign license agreements. The stations were all struggling at the time, some have since stopped streaming, and the issue quieted down.
Now Acacia, using the name Aldav LLC and based in Texas, has filed suit against Clear Channel, Cumulus, Citadel, CBS Radio, Entercom, Saga, Cox Radio, Univision, Regent, Gap, Radio One, and the Aloha Station Trust, claiming that, by replacing advertising and other content in their online streams, the broadcasters are infringing on a patent on which Aldav holds a license.
In an article in Streaming Media covering the first round of IP property based claims, Publisher Dan Rayburn wrote: “Acacia appears to have made a business of buying patents and then using the threat of massive legal action to force companies into paying them licensing fees. In September 2002, the company lost a patent lawsuit against Sony, Sharp, and Toshiba for the V-Chip, another patent that Acacia owns.” Someone else told me that another term for this is “patent trolling.” Indeed, this behavior does appear kind of predatory.
In an article he wrote on his blog last week, Jerry Del Colliano fueled this fire by saying this was big trouble. He also states that Ando Media sells the ad insertion technology, which is true for some, but not all of the broadcast groups. I know that at least Cox, Cumulus, Radio One and Univision, and possibly others use other ad insertion technologies, including StreamAudio and Abacast.
I can’t pretend to have any expertise that will help to figure this out, but I did want to lend some historical and factual perspective to the story. Broadcasters realize this is important turf for them, and this may well be a typical battle for new technology in a new media world.