August 30, 2000 2:00 PM PDT

2HRS2GO: No winners in Micron vs. Rambus

Whatever happened to the "property" part of intellectual property?

The legal fight between Rambus (Nasdaq: RMBS) and Micron Technology (NYSE: MU) highlights the precariousness of Rambus' position. If Rambus loses this one, it's not long for this world.

Shares of both companies have fallen more than 6 percent since Micron announced its lawsuit. Wall Street has the right idea: there are no winners here. If Rambus wins, it can hold the memory chip industry hostage; if Micron wins, you have to wonder if patents mean anything anymore.

Micron claims Rambus had an obligation to share its SDRAM technology with the Joint Electronic Device Engineering Council. "Rambus subverted the open standards process so that it could gain monopoly control of the Synchronous DRAM technology and Synchronous DRAM markets," Micron asserts in its court filing.

Tech firms love private, industry-created committees as a means of setting standards, partly because techies view Washington, D.C. oversight to a tonton macoute-style Big Brother.

Apparently Rambus didn't inform JEDEC about its SDRAM patent application. But JEDEC is a private industry group, not a government regulatory body, and I always figured "private" also means you have the right to opt out. Nonetheless, Micron claims Rambus' failure to share constitutes an antitrust violation.

Without hearing the legal arguments, I have a hard time accepting Micron's claim. Why should the Federal government mediate what seems to be a private dispute between two members of the chip industry?

After all, a patent is a patent, designed specifically for defending proprietary discoveries. We're not talking about a generic "business process" patent or something as simplistic as a "one-click" button for shopping, but rather actual, non-obvious technology that someone had to invent.

This isn't about the quality of Rambus' patents. It's not concerned with the neverending ZDNet debate over the price and performance of RDRAM. Those are separate issues.

It's about owning what you invent. Micron wants a Federal court to give away Rambus' SDRAM technology. I don't care what kind of standards body governs the chip industry, if Rambus created something -- and I assume it did, since Micron isn't challenging Rambus' discovery, only the ability to charge for it -- then Rambus ought to have the right to that property.

Would these patents give Rambus a monopoly on DRAM technology? Maybe, but a monopoly isn't illegal. Neither is enforcing a patent that was granted to you by the U.S. government.

Lawyers can argue both sides. But as legal armies descend upon another case tinged with antitrust implications, you can see why die-hard capitalists believe so strongly in the free market. It's more efficient.

Online health: too generic

Health-care websites this week made the kind of news we've come to expect from Internet companies nowadays, featuring layoffs, executive changes and a change of venue. PlanetRx.com (Nasdaq: PLRX) and Drkoop.com (Nasdaq: KOOP) are cutting jobs, with the former also moving east to Memphis, Tenn., home of the King of Rock, Elvis, and the King of the Piledriver, Jerry Lawler.

You can blame the plight of these companies on many factors, including overheated expectations from Wall Street. But there's a larger concern: how are these online health firms distinguishable?

I asked that question when Drkoop.com went public more than a year ago, and I still haven't heard a good answer.

That remains the real problem with most of the Internet health cares, whether we're talking content feeders or drug sellers. A pill-buyer has no reason to feel loyalty to PlanetRx.com, Drugstore.com (Nasdaq: DSCM) or VitaminShoppe.com (Nasdaq: VSHP)? For the average consumer, there's little to choose between Drkoop.com and Medscape (Nasdaq: MDLI), speaking of companies that recently lost a CFO.

The idea of online health services also discounts one of the biggest factors in medicine: people. Most folks who want medical advice prefer a doctor face-to-face. And ask any pharmacist -- they have their regular customers who come in every month or two months like clockwork.

Personal relationships mean more in the health care field than almost any other industry. Until the Internet can provide that human touch, health info portals are hardly more than glorified Health news sites, and online pharmacies nothing more than another version of drugs-by-mail.

There is a place for online consumer health, as an adjunct to a larger business. Healtheon/WebMD (Nasdaq: HLTH), for instance, runs a Web portal, but the company's long-term money-maker lies in Webifying certain processes in the health industry, like insurance verification. It's really a back-end solution vendor purporting to offer benefits over the legacy systems that currently dominate medical IT.

Healtheon/WebMD is not a guaranteed long-term success, mind you. But at least it offers a tangible difference in its field. Standalone consumer health websites can't say the same thing. 22GO>

 

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot

Discussions

Shared

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.