Acacia Update: No News Is Good News?

StreamingMedia.com has been covering the story of Acacia Research Corporation’s Technologies Group and its efforts to license and litigate its Digital Media Transmission (DMT) patents for the past two years. During most of that time, the company has been at the center of a whirlwind of controversy and criticism regarding the validity of these patents as well as the ethics of their underlying business model.

For those who haven’t followed this story, Acacia has claimed that their DMT patents encompass essentially all things on-demand streaming, although not live streaming. You can read more about the background of this story in StreamingMedia.com’s Acacia Patent Info section.

But 2006 has been a quiet year for DMT, at least compared to year before. A quick scan through Acacia’s press releases shows that while 2004 and 2005 saw hundreds of DMT licenses being sold, only a small handful have been announced so far in 2006. And even those that have been announced are deals with companies like Eastman Chemical Company and Union Pacific Corporation—not exactly names you’d think of when it comes to streaming media.

A common thread among these companies, though, is that they’re all large enterprises, which fits in with what has been a common tactic employed by Acacia: threatening companies with potentially expensive lawsuits and then offering them licensing deals that will likely cost them less than going to trial. The belief among many in the streaming industry is that these larger companies would rather just pay the licensing fees and get this issue resolved than take it to court and have to wade through a lengthy trial.

Speaking of lengthy trials, the ongoing case between Acacia and a host of companies ranging from adult video websites to cable operators has yet to make any real progress since last we reported on it in a January article. According to Jonathan Singer, principal of Fish & Richardson P.C. and lead counsel for New Destiny Internet Group, one of the adult entertainment companies, the case is still in the middle of the Markman proceedings, where the court examines the claims made by all parties. Another hearing is scheduled for sometime in September, and Singer expects the court to issue a final Markman ruling by the end of the year. After that, the case will either proceed forward in district court, or the Markman ruling may be appealed to a federal court. Needless to say, there doesn’t appear to be a legal resolution to Acacia’s efforts to license its DMT patents any time soon.

In the meantime, Acacia hasn’t been sitting still. They’ve been acquiring a whole host of other patent sets and licensing those to companies from across the spectrum. Many of these new patents deal with technologies totally unrelated to streaming, but there are a few that may be relevant to StreamingMedia.com’s readers, although none so much as the DMT patents.

These include a patent for video tracking technology, which relates to technology that allows webcams and other digital cameras to automatically track and center the image of videoconference participants, and patents for mobile communications devices and networks, which relate to devices that are capable of accessing and/or controlling other devices on a network to receive, transmit, relay, and/or process voice and data across the network.

Acacia also certainly hasn’t been sitting still when it comes to making money. In their second quarter financial earnings report, they announced that their second quarter earnings have increased from $2.682 million in ’05 to $14.371 million in ’06. Additionally, since StreamingMedia.com first wrote about Acacia in the summer of ’04, Acacia Technologies’ stock price has risen from around $3 to a high of nearly $15 earlier this summer. They’re currently at $10.98 as of noon EDT on September 5, 2006.