August 14, 2003 11:12 AM PDT

Ad firm 24/7 pushing for patent power

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24/7 Real Media was granted a patent Thursday for a method of delivering digital advertisements, giving it new authority over the online ad-serving market.

The New York-based interactive-ad company already holds a patent, awarded July 29, for a method of serving digital ads aimed at specific audiences. The new patent extends that coverage to include a way of serving sequenced advertisements via the Internet, interactive TV or wireless devices. As their name suggests, sequenced ads are made up of separate components that appear one after the other, like a storyboard.

24/7 Real Media has been aggressively pursuing patent licenses to improve its shareholder value.

In total, 24/7 has licensed its patents to six rivals, including top online-marketing company DoubleClick, as well as ad networks ValueClick and Advertising.com. Earlier this week, it announced that it licensed one of its patents to rival Accipter, which sells online-ad delivery technology. Accipter will use 24/7's patent for a method of targeting online ads. Each licensee pays an up-front fee and a revenue-based royalty, but terms of the deals have not been disclosed.

"It is very encouraging to see growth in the number of companies that pay 24/7 Real Media patent royalties and to have achieved this growth without prolonged litigation," 24/7 Real Media's CEO David Moore said in a statement.

"We believe that as Internet advertising rebounds, our licenses will generate a visible additional revenue stream," Moore said.

On Tuesday, 24/7 reported a second-quarter loss that shrank from the same period in 2002 on revenue that was up by 15 percent. The company said it had a second-quarter loss of $2.5 million, or 6 cents a share, on revenue of $12.2 million. That compared with a loss of $4.2 million, or 8 cents a share, on revenue of $10.6 million in the comparable period.

Still, 24/7 is in a patent battle with rival Aquantive, formerly known as Avenue A. Last month, the U.S. Federal Court for the Western District of Washington granted partial summary judgment to Aquantive in a lawsuit that alleged that Aquantive infringed 24/7's patent for targeted advertising. 24/7 said it will appeal the ruling.

Specifically, 24/7 said the court's decision did not address whether Aquantive's ad-serving system, called Atlas DMT, infringes its patent when delivering sequenced ads.

24/7 has also said it is pursuing targeted-ad licensees in the paid-search industry and cable TV technology market. 24/7 said many companies in those areas are infringing its patents.

 

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