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Apple's iPod Patent Play Goes Off-Key

By Arik Hesseldahl Having turned the music industry on its ear with the combination of its iPod digital player and its iTunes Music Store, Apple Computer (APPL) appears to have been frustrated in its attempt to patent one feature of the iPod's software interface by a researcher from Microsoft (MSFT).

Last month, the U.S. Patent & Trademark Office rejected an Apple patent application filed in September, 2002, for a "method and apparatus for use of rotational user inputs." It cited among its reasons a patent application by Microsoft researcher John Platt, who had filed some three months earlier.

ROBO DEEJAY. Platt's application for "auto playlist generation with multiple seed songs" concerns ways that a computer or other device can learn from a user's behavior and repeated selection of music in order to populate a music playlist.

David Kaefer, who runs business development for Microsoft's intellectual property licensing group, says Platt's expertise concerns the field of machine learning. Among other things, Kaefer says, machine-learning techniques can be used to help a program distinguish good from unwanted e-mail by tracking which messages the user marks as spam. Over time, patterns emerge, and the computer can start removing spam before the user sees it.

The same principles of machine learning can be applied to managing large libraries of digital media files. If you tend to listen to more big band jazz than heavy metal, your computer or player would start to notice a pattern based on your listening habits. "When certain things happen in a repeatable pattern, the computer picks up on the trends," Kaefer says. "And it can be used to automate the process of building a playlist."

HISTORY OF CROSS-LICENSING. Kaefer says the value of a patent has a lot to do with how many alternative ways there are to achieve the same result. "In the same way there were lots of ways to separate the seeds from the cotton, there is more than one way to build a playlist."

And when that happens, companies usually find it's helpful to take out a license on each other's patents. He didn't say for sure whether or not that would happen in this particular case, but Apple and Microsoft have a long history of taking out cross-licenses with each other.

That's how it usually works between large companies, says Dennis Crouch, a patent lawyer with McDonnell Boehnen Hulbert & Berghoff in Chicago. They're more eager to get on with business as usual than head to court. "Both Microsoft and Apple are more interested in cross-licensing than in stepping on each other's toes in filing patent-infringement lawsuits. Both are quite often defendants in these suits, but rarely plaintiffs."

PART OF THE PROCESS. When word of the matter made the rounds of tech gossip sites, it got more than a few observers snickering at Apple's apparent setback. Actually, it was nothing of the kind. "Neither of these are market-controlling patents," Crouch says.

Despite the rejection letter from the patent office, Apple still hasn't finished with its application. A rejection is usually only one step in a lengthy back-and-forth process that keeps lawyers busy. In a statement e-mailed to BusinessWeek Online, Apple says it "will continue to pursue this patent application, as well as the many others covering iPod innovations.pple invented and publicly released the iPod interface before the Microsoft patent application cited by the examiner was filed." Hesseldahl is a reporter for BusinessWeek Online in New York

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