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High-Tech Patent Granted to Major League Baseball

May 16, 2009

The patent for a new technology that prohibits particular fans from having the ability to view local games online has been won by Major League Baseball, and it could potentially pave the way for the U.S. sports league to earn residuals by awarding licenses to media companies, Reuters accounted.

The online geolocation technology system patent was granted to baseball’s advanced media business just last month.  The sports league said the system utilized two or more forms of electronic methods, like wireless and satellite, to isolate the geographic point of a subscriber. 

In 2004, the sports league filed for the patent for the first time in effort to keep viewers from watching its games streamed live online.

To preserve the hundreds of millions of dollars its clubs make in rights fees from regional sports networks like New York Yankees’ YES or Boston Red Sox’s NESN, the MLB sought to block reception of games in a subscriber’s local market. 

In a telephone interview, Bob Bowman, chief executive of baseball’s advanced media arm said “This was a clear example where necessity really was the mother of invention.”

Analysts say that with this patent, baseball could now confront any company utilizing multiple geolocation technologies to ascertain the location of a subscriber and request a licensing fee.  Otherwise, those companies would have to try and work around the patent or challenge it in court. 

The MLB patent requires that at least two geolocation technologies be used in addition with a subscriber model.  Such a definitive scope will likely limit the league’s reach, Gartner analyst, Ray Valdes, said.  Valdes specializes in the Internet and Web services. 

Additionally, media companies are not greatly anxious about making money through an online subscription model and the patent will probably make the largest waves in the sports world, he said.

“I don’t see a big footprint in the mobile industry for this patent,” Valdes said. “It might limit options in the future, but right now there’s not a lot of that activity going on and frankly I haven’t seen the industry heading in the direction.”

“Some of this could get played out in the courts,” he added. “Sometimes, the true essence of a patent is only determined by litigation.”
Previous legal suits for patent infringement by other companies has made baseball careful to guard itself, Bowman said, but officials still urge the league to consider protection for its intellectual property. 

“It’s something the management and board should review,” he said.

The patent application enumerated how its technology could apply to promotions, sweepstakes, contests, fantasy games, sale of goods or services, and targeted advertising. But Valdez pointed out that this kind of verbal rhetoric was common as companies try to expand the scope of a patent. 

Although Bowman did not list specifically, he mentioned that baseball had 10 additional patents pending with the U.S. Patent and Trademark office.  Valdez indicated, however, that more patents based on the original one would certainly reinforce baseball’s attempts. 

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