Light Reading

Concurrent Plays the Patent Card

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
5/30/2007
50%
50%

Concurrent Computer Corp. (Nasdaq: CCUR) has retained an intellectual property specialist to help the video-on-demand (VOD) server and software firm make money from three patents that Concurrent believes are critical to targeted advertising applications. But the question remains whether Concurrent will use a carrot or a stick to execute this "value extraction program."

That hired gun, Atlanta-based IPinvestments Group, will base the effort on a batch of intellectual property, including three U.S. patents: 5,931,901; 6,038,591; and 6,161,142.

Filed in 1997, the '901 patent is considered the parent, with the other two marked as continuations of the original. The '901 and '591 patents describe a method for "Programmed music on demand from the Internet," but also detail a system and method for targeted advertising messages. The '142 follow-on patent is similar and scope, but comes under the more refined heading of "Method and system for using a communication network to supply targeted streaming advertising in interactive media."

Concurrent obtained the patents in late 2005 via a $15 million acquisition of Everstream , a company that specializes in systems that analyze performance data and reporting for VOD and other digital services. (See Concurrent Acquires Everstream.)

As for the strategy itself, some question Concurrent's motives. "This is a billboard that says, 'We need money,' " says one industry observer.

Earlier this month, Concurrent closed a $14 million private placement comprising the sale of 11.2 million common shares for $1.25 a piece, plus warrants for an additional 2.8 million shares. At the time, Brian Coyne, a senior analyst for Friedman Billings Ramsey & Co. Inc. , noted that the move "removes the liquidity overhang" on the vendor and could reinvigorate Concurrent's opportunities with cable MSOs and telcos. He also anticipated that Concurrent could begin to monetize a portion of the Everstream patent portfolio. (See Concurrent's War Drawer .)

Concurrent executive vice president Kirk Somers insists the patent monetization strategy has nothing to do with the financial standing of the company. He asserts that Concurrent has been mulling this strategy for several quarters, going as far as hiring outside council to research the file history of the patents and determine whether Concurrent should move forward "with a more aggressive stance with this portfolio."

"The question was how to monetize this portfolio in the best way possible," Somers says.

At this point, Concurrent has identified two possible paths: auctioning the patents and receiving a license for the intellectual property; or enforcing the patents through litigation.

Somers says the company has not ruled out either strategy but will explore the auction option first.

So far, Concurrent has identified between 50 and 60 "targets" for an auction strategy. All targets, Somers notes, are companies that Concurrent believes infringe, or have products that could infringe, on the patent portfolio.

In addition to cable operators, those targets include Yahoo Inc. (Nasdaq: YHOO), Google (Nasdaq: GOOG), SeaChange International Inc. (Nasdaq: SEAC), C-COR Corp. (Nasdaq: CCBL), Microsoft Corp. (Nasdaq: MSFT), and aQuantive Inc. (Nasdaq: AQNT), an Internet and VOD advertising specialist that is in the process of being acquired by Microsoft for $6 billion. (See Microsoft to Buy aQuantive.)

Concurrent sent a letter to all of these targets, giving them 60 days to perform due diligence and decide whether they want to participate in an auction. If there's no interest, it's likely that Concurrent will pursue patent enforcement.

"It's possible," Somers said, when asked if that could put MSOs into harm's way as patent enforcement targets. But, he acknowledged, Concurrent would like to avoid that situation if at all possible: "You don't want to bite the hand that feeds you."

Concurrent plans to make a final decision by September, with revenue from the strategy arriving before the end of this calendar year. Somers declined to estimate how much revenue Concurrent might generate from its patent-related moves.

If Concurrent decides to enforce the patents, it could slow down a category that cable operators and telcos alike believe will reduce consumer ad-skipping and create a new source of revenue. Although early implementations will target ads to groups based on demographic data, eventually operators and advertisers hope to target specific spots to individual homes or viewers.

— Jeff Baumgartner, Site Editor, Cable Digital News

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Educational Resources
sponsor supplied content
Educational Resources Archive
Flash Poll
From The Founder
The New IP is actually bigger even than business. Like another hugely important tech that Light Reading is digging into right now, the New IP has the potential to change the world by fundamentally advancing what it is possible for people to achieve with communications.
Que Sera Sarah
Growth of the 5G Ecosystem

3|6|15   |   1:15   |   (1) comment


Use cases and industry collaborations dominated 5G discussions during Mobile World Congress 2015. For what the road to 5G means for operators and their partners, head to the Building America's 5G Ecosystem event in New York on April 14.
LRTV Custom TV
Sonus NaaS IQ Real-Time Demo

3|6|15   |   4:03   |   (0) comments


Compass Networks Chairman and CEO Matt Bross and Ray Dolin, CEO of Sonus Networks, demonstrate their Sonus IQ SDN solution using a live video conference connection.
LRTV Custom TV
LRTV Talks Carrier WiFi & WiFi Calling With Aptilo Networks

3|6|15   |   4:53   |   (0) comments


We stopped by Aptilo Networks, a market leader in WiFi service management and offloading, to discuss the new possibilities with next-generation WiFi calling and why WiFi should be a natural part of any operator strategy.
LRTV Interviews
NGMN Chairman Outlines His 5G Vision

3|6|15   |   5:10   |   (1) comment


Bruno Jacobfeuerborn, chairman of the NGMN Alliance and Deutsche Telekom CTO, shares his thoughts on the challenges, opportunities and costs of 5G.
LRTV Interviews
In the Cloud With Telecom Italia

3|5|15   |   7:10   |   (0) comments


Light Reading CEO Steve Saunders sits down with Telecom Italia's Simone Battiferri at Mobile World Congress to discuss virtualization, agility and the economic advantages of the cloud.
LRTV Huawei Video Resource Center
New Ways of Working

3|5|15   |   4:24   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Hong Kong Telecom's Michael Yue explains how the transformation in its business has changed its customer relationships.
LRTV Huawei Video Resource Center
Bridging the Digital Gap

3|5|15   |   4:03   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Boingo's Dr. Derek Peterson explains how ICT can help telcos bring the physical and virtual worlds closer together.
LRTV Huawei Video Resource Center
Making the Internet of Things Affordable

3|5|15   |   2:42   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Telefonica's Dr. Mike Short explains how the Internet of Things demands a new low-cost approach to connectivity from telcos.
LRTV Huawei Video Resource Center
Evolution, Not Revolution

3|5|15   |   2:00   |   (0) comments


At the ICT Leaders Roundtable, hosted jointly by Light Reading and Huawei at the Hotel Renaissance in Barcelona just prior to Mobile World Congress, Heavy Reading's Patrick Donegan explains why telcos can't be too hasty in their efforts to transform themselves.
LRTV Custom TV
Management & Orchestration Enablement Strategies Required for NFV Commercial Success

3|5|15   |   6:22   |   (0) comments


NFV commercial success rests on successful service orchestration strategies which can span heterogeneous physical, virtual, legacy and next-gen networks. Network data and security integrity are additional key aspects. Nakina provides a suite of orchestratable network integrity applications built on an open, scalable MANO enablement platform.
LRTV Huawei Video Resource Center
The Power of Five Convergences in OceanStor OS

3|4|15   |   6:24   |   (0) comments


OceanStor OS is Huawei's brand-new storage operating system. While inheriting the consistent high stability, reliability and performance from the company's previous storage products, OceanStor OS abounds in new converged storage features. Specifically, the new storage operating system achieves "five convergences" to lift storage convergence to a higher level.
LRTV Huawei Video Resource Center
4K Brings Extreme Video Experience

3|4|15   |   8:10   |   (0) comments


4K video is a hot topic in the video industry. It will certainly bring an extreme video experience to end users. At the same time, however, it will also pose a big challenge to operators. Check out this Huawei 4K experts' discussion about how operators can achieve success in 4K video service.
Upcoming Live Events
March 17, 2015, The Cable Center, Denver, CO
April 14, 2015, The Westin Times Square, New York City, NY
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
All Upcoming Live Events
Infographics
Net neutrality, broadband services and the current outlook on data consumption, as presented by the New Jersey Institute of Technology.
Hot Topics
Internet Pioneers Decry Title II Rules
Carol Wilson, Editor-at-large, 3/2/2015
Wheeler: We'll Enforce Title II 'Case-By-Case'
Sarah Thomas, Editorial Operations Director, 3/3/2015
New CenturyLink CTO in Major Overhaul
Carol Wilson, Editor-at-large, 3/4/2015
Alibaba 'Planting a Flag' in US Cloud Market
Mitch Wagner, West Coast Bureau Chief, Light Reading, 3/4/2015
Few in Number, Big in Data
Sarah Thomas, Editorial Operations Director, 3/2/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Chattanooga’s EPB publicly owned utility comms company has become a poster child for how to enable a local economy using next-gen networking technology. Steve Saunders, Founder of Light Reading, sits down with Harold DePriest, president and CEO of EPB, to learn how EPB is bringing big time tech to small town America.
Light Reading CEO Steve Saunders talks transformation and virtualization – including Light Reading's independent testing of the vendor's virtualization solutions – with Cisco CEO John Chambers at Mobile World Congress in Barcelona.
Check out Light Reading's interview with Jay Samit, the newly appointed CEO of publicly traded SeaChange International Inc. With a resume that includes Sony, EMI, and Universal, Samit brings a reputation as an entrepreneur and a disruptor to his new role at the video solutions company. Hear what he had to say about the opportunities in video, as well as the outlook for cable, telco, OTT and mobile service providers.
G'day! And welcome to an entirely new feature on Light Reading -- our weekly "CEO-to-CEO" interview.