E-Business and Intellectual Property

Essay by lucinic March 2008

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Patents need to be protected in order for a company to have an advantage in a very competitive market. The Internet revolution has seen a massive increase in the long distance purchases made by consumers, as geographical barriers is no longer as important as they were. Protection is needed for those businesses who conduct business in ways other than in person.

A type of industrial property protection can basically be called patents. This type of protection is used to stimulate the innovation and design of new technology. It basically protects the investments made to develop new technology. Patent protection is usually given in terms, mainly about 20 years. In the article "E-Boom or E-Bust? Business Method Patent and The Future of Dotcommerce," the authors argue that State Street Bank v. Signature Financial Group caused a rush upon the U.S. Patent and Trademark Office (PTO). The evidence clearly supports such an argument.

Before this State Street Bank business methods were unpatentable due to a judicial exclusion of methods of doing business. However, the court in State Street Bank, laid this exception to patent law to rest in 1998 stating that "data structures encoded in computer memory constitute patentable subject matter" (Marsden & Huffman, 2000, p. 18). This had to cause a rush on the PTO. A whole new area of commerce had become available to patent protection; a rush would be the only term sufficient to define the number of patent applications that would descend on the PTO.

The authors next argue that the Internet explosion also was affected by the court's finding in State Street Bank. The Internet revolves around commerce. Most sites have a way of generating money, whether producing revenue is from one-stop-shopping or advertising. Many of these sites have used or will use business methods that are...