Unicast asserts new patent covers rich media ads

http://biz.yahoo.com/rc/031230/media_advertising_unicast_1.html

Reuters
Unicast asserts new patent covers rich media ads
Tuesday December 30, 3:34 pm ET 
By Michele Gershberg 



NEW YORK, Dec 30 (Reuters) - Privately-held Unicast, known for ads that
appear as a user moves between Web site pages, is challenging rivals in the
Internet advertising and publishing business armed with a new patent for
delivering ads online. 


	
Unicast says it developed its original ad delivery methods back in 1996,
during the infancy of the online ad business. 

This past spring, Unicast said it won a new U.S. patent for delivering a
wider range of online marketing -- from more sophisticated rich media ads
that can combine animated graphics and music to billboard-like banner ads. 


Rich media is now a hot property as big name advertisers put millions more
dollars into marketing on the Web. Unicast's claims could affect both online
publishers such as Microsoft (NasdaqNM:MSFT
<http://finance.yahoo.com/q?s=msft>  - News
<http://finance.yahoo.com/q/h?s=msft> ) and Yahoo (NasdaqNM:YHOO
<http://finance.yahoo.com/q?s=yhoo>  - News
<http://finance.yahoo.com/q/h?s=yhoo> ), who place ads on their Internet
sites, and immediate advertising rivals including DoubleClick (NasdaqNM:DCLK
<http://finance.yahoo.com/q?s=dclk>  - News
<http://finance.yahoo.com/q/h?s=dclk> ) and Eyeblaster, according to
analysts. 


"This happens to be a method used to serve all rich media content, any
Flash-based advertising," said Unicast Chief Executive Richard Hopple,
referring to Macromedia's (NasdaqNM:MACR <http://finance.yahoo.com/q?s=macr>
- News <http://finance.yahoo.com/q/h?s=macr> ) popular Flash plug-in
software for rich animated graphics. 


"The browser has to ask what ad do you want me to play for this person,
where do I go to get that ad and ... what I do with it," Hopple told Reuters
in an interview. 


Earlier this quarter, Unicast secured its first license deal with Internet
ad company aQuantive (NasdaqNM:AQNT <http://finance.yahoo.com/q?s=aqnt>  -
News <http://finance.yahoo.com/q/h?s=aqnt> ), boosting its case for wresting
fees from top online publishers. 


The Unicast patent spells out a delivery process which uses an electronic
tag in a Web page. That tag signals to an external computer server where to
find an advertisement and how to display it. 


Jim Nail, senior analyst at Forrester Research, said the patent could give
Unicast an edge over immediate rivals with ad formats similar to the
"superstitial" product who might be more vulnerable to infringement claims
on their delivery methods. 


"I'm kind of surprised they would get a patent that's as broad as that.
Calling for something on a central server is the way the Web works," Nail
said. 


RICH MEDIA ADS SET FOR STEADY GROWTH 


Internet ad spending is expected to grow between 10 percent and 20 percent
in 2004 as advertisers seek new ways to reach consumers. Jupiter Research
projects rich media-type advertising will grow from $3.1 billion in 2003 to
$3.6 billion in 2004 and $7 billion by 2008. 


Hopple said that when Unicast started out, other companies were designing
ads as part of a Web page, a process no longer practical as Internet sites
frequently change ads and target users based on what they are looking for on
the Web. 


Two years ago, Unicast patented the technology to deliver its flagship
"superstitial" ads from an external server. The newer patent beefs up that
protection of rich media ads, banners and pop-ups, he said. 


Internet ad-delivery and tracking company DoubleClick said it had patented
its own method for targeting online advertisements at customers more than
four years ago, but had yet to review the Unicast patent. Representatives
from Microsoft and Yahoo were not immediately available for comment. 


An aQuantive spokesman said the company agreed to a perpetual license of
Unicast's ad serving patents on behalf of its Atlas DMT unit, but would not
disclose terms. 


"With this license, Atlas DMT removes a potential risk, not only from our
business, but even more significantly, from our clients, which include 114
interactive agencies and direct advertisers," spokesman Steve Stratz wrote
in a response. 


Internet analysts questioned whether Unicast could rake in significant
revenue, but said similar online patents have helped companies defend their
claims to leadership. 


These include pioneer online access service Compuserve's claim to creating
the first widely-used graphic format -- known as "GIF" -- and retailer
Amazon.com's (NasdaqNM:AMZN <http://finance.yahoo.com/q?s=amzn>  - News
<http://finance.yahoo.com/q/h?s=amzn> ) controversial "one click" shopping
patent. 


"It represents a great opportunity for (Unicast) but it's definitely a bit
of a murky area and one that seems to dampen innovation," said Gary Stein,
senior analyst at Jupiter Research.