Thursday, July 30, 2009

NeoMedia Business Model in 3 Easy Steps

1. Patent an existing technology

2. Shake down existing players for license fees (or, you know, sue the pants off them)

3. Compete directly with your licensees.

Lather. Rinse. Repeat.


  1. LOL! Miranda, you sound like a dumbass chick. Go back to the kitchen, and get me a beer. If you can't put your real name on this article, then STFU.

  2. Charming stuff! I'll let this comment stand, Scanbuy Sucks, but only this one. The rest, well, I'd say type them up, print them out, fold the list neatly three or four times, and place it directly where the sun don't shine.

  3. Goodness! This is like looking at the political blogs. Ease up. The three steps are no where near correct, but an interesting note. My guess is that if you read the patents, the first observation will be that the patents are not about barcoding, but about the lookup process. The lookup process is unique and why it was patentable and the supported after a review. The fact that NeoMedia is working toward a standard use of barcodes is both good, and certainly self supporting. If barecode reading reaches outside the cell phone, then there is a good chance there is a use of one of the NeoMedia patents. Obviously the reason for NeoMedia to push barcode reading. The licensing is not to read barcodes - most call phones do that now.
    Not a NeoMedia person...

  4. Thanks for your perspective, Rick, but in my opinion NeoMedia consistently attempted to bluff and bully its way into holding the patent key to the mobile ID kingdom. For years. Yes, their latest patent argument was successful, making their licensing and litigation perfectly legal.

    But I'm not talking about legalities. NeoMedia's drive for patents is not about innovation, nor about enlivening the industry. It's about patenting an existing technology to squeeze money from the true innovators via licensing fees and lawsuits. It's simply wrong, and vulgar.

  5. Clay G.8:42 PM

    I agree with Rick. The Neomedia patent concerns the indirect method, not direct. The indirect method wasn't an existing technology at the time the patent was submitted, which I believe was the late 90s (eons ago in technology years). The EFF tried to find prior art and could not, thus the patent was validated by the USPTO upon reexamination. Only in hindsight does it seem like it must have existed forever.

    Wouldn't you agree Miranda that anyone can use the direct method unencumbered? QR, data matrix, and EZ Code are non-proprietary, and much of the 2D code action you see today is direct.

  6. Miranda.. purely a guess on my part. I think that NeoMedia sued a couple companies several years ago and won - companies that could afford a legal challenge (Virgin Music, etc.) Since then, NeoMedia has changed CEOs every few months. The difficulty probably comes from the guidelines by the VC firm which owns most of their stock. So, for a few years, there has been zero action by NeoMedia - just the rumors and worries in the industry of NeoMedia suits. And blogs like this one. The threat is perpetuated. The only suit is the long term suit against ScanBuy - which I expect will be a clean victory for NeoMedia. In this case, ScanBuy knows that they are on top of the NeoMedia patent, and ho[ping that time and number of customers will help their plea. I think NeoMedia's goal is licensing those compoanies that step on their patents. This is not a challenge to most businesses. I have customers around the world using cell phones reading barcodes - and there is nothing I am doing that is close to what NeoMedeia is licensing. It is a wide open world.

  7. Anonymous4:26 AM

    What complete unadulterated nonsense.

    "Patent an existing technology." LOL. That issue was the subject of a USPTO reexam and they concluded - in February of this year - that, after requiring some modifications to the patent, there is no prior art that could invalidate it. So the assertion that Neomedia patented an existing technology is utterly without foundation.
    Or, perhaps, you know of some legally relevant prior art out there that the USPTO just missed. If so, point it out. If not, retract.

  8. Anonymous5:29 AM

    can someone please tell me how many phones in the US can
    1. Download the reader
    2. Have a reader that is preloaded
    3. Have a reader and % that use it

    Bless you for date, no one will go out on a limb and tell marketers the real deal on the ubiquity of these things. Or lack there of.

  9. Anonymous6:09 AM

    Should neomedia sue you? lol

  10. Anonymous6:22 AM

    1. Patent an existing technology sounds liable, fool. Well Neomedia sue you? 2. Shake down existing players for license fees (or, you know, sue the pants off them) lol

  11. direct method1:07 PM

    Thank you for taking a stand and writing a piece to get people thinking about the realities of this patent and their potential negative effects.

    Neomedia is a PATENT TROLL - plain and simple. I was kicked off the investorshub crackboard for saying this (in a much more polite way mind you). They obvioulsy want to keep this closed lipped.

    Scientific Study on Patent Trolls by Berkeley University - page 22, table 1 - TROLLS IN THE DATASET = NEOMEDIA.

    A Harvard Law article (pg. 23) - - defines a patent troll as a: participants who seek patents solely for the purpose of initiating infringement lawsuits and extorting licensing fees from competitors without producing any product or bringing any innovation to the market. Article also explains reasons why PTO needs an massive over-haul.

    So - What did Neomedia create? What does Neomedia sell?

    They did not create QR Codes, barcodes or any other code. They did not create URL’s and redirect processes, They did not create mobile readers. They did not create anything in the patent 048.

    What do they sell? Nothing - their reader is free and there were 20 of them on the free market before Neoreader - therefore not innovative - and their campaign manager sphere is useless and no one uses it - it also has nothing directly to do with patent 048.

    How do they make their money? Licenses/Ransom. Why is their share price $0.01? because they aren’t selling licenses nor will they. Name the license agreements - Mobiletag - ceo used to work for them. Neustar is a partnership…in crime, Scanbuy - settled out of court probably for $1, who else - i think i heard of a deal in south america - who knows for how much.

    So although their business model is licensing which makes them a TROLL - they don’t seem to being doing a very good job collecting. GomoNews or should I say the Neomedia Times - said that there are 100’s of patent infringers. Ok - so where are 100’s of licenses almost a year after the patent was reduced from 95 claims to 89 claims?

    Bottom line is that there is tremendous overhead if your business model is based around courts and litigation. NEOMEDIA simply does not have the funds to pursue anyone. Certainly not a Microsoft or a Google - who in essence are the companies they need to reel in to a. make any kind of money b. send a message to other infringers. GOOD LUCK WITH THAT!

    Companies will create work-arounds to 048. Neomedia and there investors should pray that they do. Why? Because as soon as Neomedia decides to actually go to court - you can say goodbye to 048 and NEOM all together based on “obvious” and “prior art”.

    Here’s a question - if Neomedia is the true player in the industry and owner of all the technology and patents - then why would Google partner with Quickmark? I know why - to send a VERY LOUD message to Neomedia that they are a non-issue.

    Neomedia has 20 employees, no revenue, and no business model, for the time being all they have is fear tactics and that to will prove to be useless. I think i read they are about to pay their CEO 5mil for not doing much. That is almost 25% of the market cap. 6 BILLION SHARES OUTSTANDING…what???

    People should continue to be inventive and come up with workarounds - not to mention that the Direct Method is a better way to proceed regardless.

    As you can see i’ve spent no time on this - all just my humble opinion.