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Steve Jobs licensed Amazon’s one-click patent for $1M in one phone call
- ghshephard 8y agoIt worked out well for both of them. I recall, at the time, when Apple did the deal for $1mm, that it provided a lot of validity to Amazon that their patent was for real, and any vendor that was directly competitive with Amazon would likely think, at least a little bit longer, before directly ignoring Amazon's patent on "one-click" purchasing.
- vanderZwan 8y agoThis article does not in any way provide us with enough information to conclude whether it was a good licensing deal for either party. It just tells a romanticized Steve Jobs business story. We don't know if this license helped Apple sell so many products that it paid back the investment. For Amazon it obviously worked out on two fronts, since they also got paid 1M. Unless you mean that this has to be weighed against lost Apple product sales on Amazon? Were Apple products even for sale on Amazon at the time?
- lyzan 8y agoHe is "recalling" from other information at the time. I don't think most apple products were for sale on Amazon at that time, but that's not really what he's talking about. He's referencing that other ecommerce sites (e.g. walmart) couldn't just say "oh, one click buying is a good idea, and an obvious one, so we'll implement it too". By having Apple pay significant money for right to use the patent, it adds validation that it isn't a frivolous patent, and actually a useful, non-trivial, non-obvious solution which warrents being licenced. It gave Amazon much better ground to file patent infringement against any competitor that attempted a 1 click checkout solution without licensing the patent, both improving chance of further licensing and reducing the chance competing ecommerce platforms would implement the feature without licensing it through Amazon.
- ghshephard 8y agoExactly correct (and much better put than I did). I remember, vividly when the "one-click" patent came out, and honestly, it seemed completely ludicrous. All of the people I knew in the valley at the time openly mocked it. It was exactly the sort of thing that any intelligent designer would have come up with, given the presence of cookies (which were at least a bit innovative, but Netscape had provided a royalty-free license to the patent). "One-Click" purchasing is precisely the idiocy that we think of, when we think of Patent abuse. So, when Apple actually paid money to Amazon, what occurred to me at the time, was that Apple had in a single stroke both added some legitimacy to the Patent, and probably got a discount on the deal because they were the initial customer. It's unclear whether the one-click behavior on IOS made use of any the processes described in the 1-click patent, but, at the very least, it didn't hurt that Apple had it in their back pocket. All in all I think it was a win-win scenario for both parties.
- fjsolwmv 8y agoIt's a simple story of mafioso power collusion. Amazon wanted to use bully power, but wasn't strong enough on its own, so Amazon recruited Apple to join. Amazon gets to rob the marketplace, and Apple gets "protection" and and an advantage against the mutual competitors Amazon attacks.
- onetimemanytime 8y ago>>This article does not in any way provide us with enough information to conclude whether it was a good licensing deal for either party. It just tells a romanticized Steve Jobs business story. I suspect a lot of deals are done this way. Joe talks to Kevin and legal sets it up. Done in a heartbeat, just in case. Whether it worked out or not...who knows but Apple went full speed ahead selling and didn't end up in court battles. (yeah, they might have won but it's just $1 mil)
- jm4 8y agoUs old timers remember what was happening at the time. It turns out it was an incredible deal for both sides. The 1-click patent didn't have a great deal of credibility at the time. Many people in the tech industry were railing against Amazon and 1-click. It seemed like such a stupid patent and I think a lot of people didn't expect it to hold up. Apple launched the iTunes store with $0.99 mp3's during the same period and the whole thing hinged on 1-click shopping. You could click a button to preview and there was one right next to it that would buy the song. No confirmation screens or checkout process. Downloaded and added to your library. It was so easy and people were spending a fortune on there because there was nothing else like it. Keep in mind this is one the heels of the decline of Napster and other mainstream P2P apps. People were being ratted out by their ISPs, sued and settling for $3000 for downloading some crummy song. Here you could do it legally and inexpensively and with a great UX because of 1-click. And for the first time you could buy a single song instead of an entire album. Prior to that, we had "singles" that contained a radio song from the album and a couple b-sides for like $5-8. Apple had to launch iTunes with 1-click for it to be successful. The $1M license fee cost far less than the inevitable lawsuit would have. They made a fortune with iTunes and used it to enter new product categories. You could argue that that was one of the pivotal moments that transformed the company into what it is today. That licensing fee was highway robbery. You also have Amazon who, at the time, had an outstanding selection, the best prices, fast handling times, reliable shipping and the most friction free buying process anywhere. Many retail sites didn't even have user accounts back then. You would enter your info with each order. The ones that did have accounts still made you click through several screens to place an order. Amazon's end of the deal is they got paid $1M to not have to sue anyone (and possible lose) and have their ridiculous patent become credible overnight. The result was they maintained their superior online shopping experience by preventing others from mimicking it and leveraged it to become the beast they are today.
- fapjacks 8y agoIt seemed like such a stupid patent because it was a stupid patent. These are exactly the kinds of patents that represent what's wrong with our patent system.
- cuboidGoat 8y ago
- mtgx 8y agoIt's the strategy Microsoft employed with android OEMs too, except Microsoft actually paid them and/or gave them a deal in which the first OEMs to accept the licensing came out on top. Once that was done it was much easier for Microsoft to convince the rest of the OEMs to pay up for the licensing.
- fbn79 8y agoone-click patent is one of the most stupid patents
- deleted 8y ago[deleted]
- yAnonymous 8y agoApple are also well in the business for stupid patents, so they know better than to question it.
- dplgk 8y agoNot sure why's you're getting down voted. I guess because your comment is considered whataboutism and the patent is not defending Apple. But yes, for example, Apple's slide to unlock phone patent is equally as dumb.
- jayess 8y agoOr the pull-down screen "rubbery stretch" effect is also a stupid patent.
- close04 8y agoApple's problem isn't that the patents are stupid, it's that the inventions or ideas never belonged to them in the first place. In the vast majority of cases the idea or implementation already existed. Like the slide to unlock which was used at least since 2005 in a commercial device. [0][1] They also tried patenting a method to reduce power consumption of a chip by reducing voltage. Something that isn't just a law of nature (thus unpatentable) but was also used decades before ever since ICs were developed (thus "prior art"). One of the most controversial patents is the "rectangle with rounded corners". This was a design patent and these in general are usually not just very hard to enforce but also stupid in most cases. [0] https://www.gsmarena.com/neonode_n1m-1137.php https://www.gsmarena.com/neonode_n1m-1137.php [1] https://www.youtube.com/watch?v=Tj-KS2kfIr0&t=240s https://www.youtube.com/watch?v=Tj-KS2kfIr0&t=240s
- Spooky23 8y agoIs this sort of thing still possible in a public companies with Sabarnes Oxley?
- QuinnyPig 8y agoWhat, an executive making a snap decision to authorize a payment to buy something? Absolutely.
- bausshf 8y agoThe patent expired last year anyway, so doesn't really matter.
- dspillett 8y agoThe "this sort of thing" question matters more generally. One stupid patent expiring doesn't stop the next tranche of stupid patents coming into existence.
- cowsandmilk 8y agowhy wouldn't it be? I'm not sure what requirements of Sarbanes-Oxley would even apply here.
- MBCook 8y agoIsn’t this basically how Zuckerberg bought Instagram? He decided to, called up with a BIG offer, and got it done at lightning speed?
- duxup 8y agoYeah the story went that he met with the folks at Instagram and there was a discussion that if Instagram joined Facebook it would be worth X% of Facebook... so they used that number.
- usrusr 8y agoOne phone call? If he licenced the patent in one click, now that would have been impressive!
- jaclaz 8y ago>So he called up Amazon and said, “Hey, this is Steve Jobs,” ... And "Amazon" replied: "Hello, Steve, my name is Adrian, I will be happy to help you." Seriously, it is not like he cold called "Amazon", he already knew whom to contact exactly, had already met the relevant executive (or the CEO) personally many times, etc., etc. , and the actual deal was probably closed after several weeks of meetings, a formal legal review and what not.
- blihp 8y agoActually Jobs may very well have called Bezos in the moment. I wouldn't be surprised if it was a verbal/handshake deal up front between Steve and Jeff with any meetings/legal review involving the relevant staff to formalize and finalize coming after they had already reached an agreement in principle. That's often how deals get done at the executive level esp. if the parties know each other.
- jaclaz 8y ago>Actually Jobs may very well have called Bezos in the moment. Sure, though the article literally says that Jobs "called up Amazon", not Bezos. Besides the (hopefully) quick laugh, what I was trying to say was that the private/direct phone number of Jeff Bezos is unlikely to have been on a public directory and that the (untold) before is that the two already knew each other personally and had most probably already done business together, the telephone call is only a tiny part of how the deal matured. There are a lot of these articles that somehow push the concept that some people (geniuses/leaders/etc.) made quick decisions/deals/whatever game changing innovations on the spur of the moment and were successful at that only because of serendipity or intuition. While this may happen, I doubt that - even if the initial sparkle came "by chance" and "suddenly" - the merit of the success of this or that deal is to be attributed to that moment alone (as opposed to the before and the after). More like T. Edison: Genius is one percent inspiration, ninety-nine percent perspiration.
- DonaldPShimoda 8y ago> Sure, though the article literally says that Jobs "called up Amazon", not Bezos. Just metonymy --- when we use an inanimate thing to stand in place of a person (like "North Korea agreed to a cease-fire", which is metonymy because the abstract concept of a country doesn't "agree to" anything). > what I was trying to say was that the private/direct phone number of Jeff Bezos is unlikely to have been on a public directory Doesn't need to be public. These high-level people (CEOs, famous musicians, etc.) have easy ways to contact one another. They might have only met once and exchanged numbers "just in case", or maybe the story was a shorthand way of saying "Steve had his secretary call Bezos's secretary right then" (which is entirely possible to do spur-of-the-moment if Apple had ever had contact with Amazon at all). I think the spirit of the story --- that the call took a very short time, maybe a couple minutes --- is totally reasonable. Tim Cook told a story once that he was unsure what to do at some point with regard to shareholders or something, so he called up Warren Buffett. Apparently they had exchanged numbers once in the past when they had been at some event together or something like that. It was a spur-of-the-moment call without any phone tag, at least as Cook tells the story.
- GeekyBear 8y agoIn that same Wired story that is the source for the blurb at the heart of this one is the most Steve Jobs tale ever told. Scott Forstall tells that Steve always insisted on paying for lunch for both of them every time they ate in the company cafeteria together. Scott felt bad about making Steve wait for him at the checkout if he ordered something customized that took longer to prepare. However, Steve insisted because he was paying by swiping his employee badge which automatically debited against your next pay period. Since Steve was paid in stock, with only a one dollar a year salary there was nothing for the company accounting system to debit against, so although he was "the man" at Apple he took a perverse pleasure in simultaneously sticking it to the man.
- snowwrestler 8y agoThis is the same guy who would trade in his leased Mercedes in less than 6 months so that he could have a barcode for a license plate. Culturally, he was a hacker--looking for the gaps in institutional systems and getting a perverse pleasure in exploiting them.
- hvdhh7 8y agoBillionaire sticks it to the Man by carefully following his rules and getting brand new Mercedes every six months.
- saudioger 8y agoYeah I feel like this is more "sticking it to the average person who could never afford this" than "the man" Steve Jobs' personality had a large role in pushing his success, but it's also the type of personality of someone who just wants to be different because they think being different is superior (and yes: sometimes it is, sometimes it isn't). If he were a kid in the 90s he'd be ~~ tYpInG aLl hIs ImS lIkE tHiS ~~
- jdswain 8y agoLike this? NeXTstep NextStep NEXTstep...
- tooltalk 8y agoDid the one-click feature have that much impact on Apple's e-commerce? I thought it was their retail stores that really made difference in how the company sold and communicated with their customers.
- tooltalk 8y agoSpeaking of licensing and Jobs's quick decision-making, the following is what you don't usually hear from Jobs's inner circle: (https://jonathanischwartz.wordpress.com/2010/03/09/good-artists-copy-great-artists-steal/ https://jonathanischwartz.wordpress.com/2010/03/09/good-arti...) "I feel for Google – Steve Jobs threatened to sue me, too. In 2003, after I unveiled a prototype Linux desktop called Project Looking Glass*, Steve called my office to let me know the graphical effects were 'stepping all over Apple’s IP'. (IP = Intellectual Property = patents, trademarks and copyrights.) If we moved forward to commercialize it, 'I’ll just sue you.' My response was simple. 'Steve, I was just watching your last presentation, and Keynote looks identical to Concurrence – do you own that IP?' Concurrence was a presentation product built by Lighthouse Design, a company I’d help to found and which Sun acquired in 1996. Lighthouse built applications for NeXTSTEP, the Unix based operating system whose core would become the foundation for all Mac products after Apple acquired NeXT in 1996. Steve had used Concurrence for years, and as Apple built their own presentation tool, it was obvious where they’d found inspiration. 'And last I checked, MacOS is now built on Unix. I think Sun has a few OS patents, too.' Steve was silent. And that was the last I heard on the topic..." so this is one example in which Jobs's poor decision making didn't pan out as he had hoped.
- sundarurfriend 8y agoIs the * after Looking Glass part of the name, or did you mean to put a footnote on it and forget?
- tooltalk 8y agoMy bad; that's not my footnote. Please see the original post: * To see a Looking Glass demo, click here – it starts at the ~2:00 minute mark.
- coldtea 8y agoI remember the project Looking Glass. It was one "few days work" demo somebody threw around when they first were able to manipulate windows in 3D in a compositor with Java, but it got traction in parts of the OSS blogosphere/forums as some revolutionary new desktop experience (even though there were already several similar commercial offerings, and itself was little more than some little-thought 3D manipulations and in no way an actual full SUN project). It was touted as "SUN innovation" example, and predictably, it got nowhere. Here it is in all its glory. Even then it was a derivative, no-sense concept: https://www.youtube.com/watch?v=u1JwfgBv5bg https://www.youtube.com/watch?v=u1JwfgBv5bg I've seen the same story play out several times. E.g. there was a node.js based editor that was the talk of HN for a while. Got nowhere, was just a simple editing window + crude syntax highlighting, and it was obvious from the start that it wont go anywhere with its direction and chops, but not if you heard the gasps just because somebody powered an editor with Node: https://news.ycombinator.com/item?id=2020673 https://news.ycombinator.com/item?id=2020673 Or the Lighttable editor -- itself being abandoned for the next shiny endeavor, which again makes sense as it was just some inline REPL touches on top of a crude editor. At least that explored the design space a little, but the promises where touting it as the next thing that will revolutionize programming...
- bradhe 8y agoMakes me think...which of his decisions DIDN’T play out quite this way?