September 30, 2004 1:56 PM PDT

Sun's Schwartz guns for patent glories

Sun Microsystems President Jonathan Schwartz, who speaks often of innovation in sales methods and not just technology, is seeking a patent on the company's per-employee software pricing plan, CNET News.com has learned.

Other co-authors of the unpublished patent application, filed in July, are Chief Marketing Officer Anil Gadre and Director of Worldwide Marketing Aisling MacRunnels. In addition, Schwartz is co-author of two other patent applications relating to Sun's three-dimensional Looking Glass user interface.

The existence of two of Schwartz's patent applications was disclosed in a filing with the Securities and Exchange Commission. The third patent application will be disclosed in a future filing, Sun said.

Schwartz in 2003 introduced a new subscription pricing plan for Sun's Java Enterprise System server software collection, charging $100 per year per employee and letting the customer use as much of the software as desired. A 1,000-employee company would pay $100,000 per year.

"It's his responsibility to shareholders to try to protect business ideas," said RedMonk analyst James Governor. "You can't blame him for trying. Amazon tried to patent one-click (Internet purchasing), and it worked."

Patents are gaining prominence in computing. IBM has long led the industry in accumulating them, but Microsoft is gunning for a dramatic increase and Hewlett-Packard boasts a burgeoning portfolio. The arrival of open-source software has meant new complications; Linux seller Red Hat has criticized Sun for its software patent policies.

"I think that IBM in particular, and Microsoft increasingly, have incredible patent arsenals. Sun needs some protections, too," Governor said.

An area of contention has been business method patents such as Priceline's reverse auction on the Internet. The head of the U.S. Patent and Trademark Office acknowledged in 2002 that the office hadn't been selective enough in that area.

"For at least the last 20 years, the advances in technology have presented challenges in terms of how you protect the new technology with intellectual property," said Gary Ritchey, a patent attorney at Townsend and Townsend and Crew. "Because we have new things invented that never were part of what people conceived of when patent protection first applied, there have always been issues of whether those technologies should come under the same umbrella as patent protection."

If the patents are granted, Sun will donate any money they generate to charities, Schwartz said.

The pricing patent application, called a "Method for Licensing Software," is summarized as a "method for licensing software to an entity, including determining a per-employee cost for the software, determining a number of employees of the entity, and determining a total licensing cost using the number of employees and the per-employee cost, wherein the total licensing cost comprises a software license for all employees of the entity and all customers of the entity."

Of the two other applications, Sun said one is for changing how objects are shown in a 3D display environment, monitoring usage information of those objects and prominently locating those that are used most frequently.

The other application is for displaying 2D information on 3D windows. If a window is displaying particular information, related information can be shown on a second surface of that window; Sun demonstrates the idea by showing a window being flipped over so notes can be written on it.

3 comments

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Isn't this the same as "all you can eat"?
Isn't this the same as "all you can eat"? You charge per head and then all the family consumes as much as they can or need.

The patent system is degrading by patenting every new obvious use of existing ideas. COntinuing this way it would soon just be ignored. Can anyone keep track of these stupid patents? Does one need to chack if any routine action might already be patented (thus needs licencing?)

Perhaps I can patent "a method and apparatus to obtain a right to charge license fees on obvious ideas and business methods"?
Posted by hadaso (468 comments )
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Employee or User pricing not new and should not qualify for patent
I find interesting the idea that a software company is trying to
patent a pricing model that is a variation of an old theme. After
Spending 20 years selling software and now helping companies
license software, the model that Sun is trying to patent is not
new.
Companies that license software today need to make sure that
the patent office look at all of the exisiting models developed by
other licensees of software and the may venders of software.
Many companies today use custom models for software licenses
based on the number of employees or users. It is clear that the
Sun model is another variation and should not be subject to
patent status.
I can only hope that some smart CIO or Asset Management
specialist stands up and says enough. Gartner Group and Meta
should also work to put a stop to this nonsense. These to
organizations have put out many ideas on software pricing
models and continue to provide clients with ideas everyday.
Even my small company does the same. We provide unique
pricing models but they are all variations of exisiting ideas that
are designed to meet a specific licensees needs.
Posted by dpierce (4 comments )
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Was This Patent Applied For with a Straight Face?
IBM/Lotus has offered per user pricing for years, Sun come late to the "innovation" and has the audacity to apply for a patent? You know, maybe they are onto something. I just offered a 10% sale to people who buy software that have any letter of the alphabet in their last name. I better go file for that patent right now:-).

Christopher Byrne, IBM CAAD/CASA
The Business Controls Caddy
<a class="jive-link-external" href="http://www.controlscaddy.com/" target="_newWindow">http://www.controlscaddy.com/</a>
Posted by tcgathens (17 comments )
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