ScanBuy, a formidable adversary w/one small exception
Midlife, it may not at all be the way it appears...
I agree, ScanBuy's shopping client roster appears to be growing in leaps and bounds. They are hooked up with well-seasoned shop search engines such as PriceGrabber, e-Bay, Amazon, and now Yahoo!. Additionally, other ScanBuy applications lets users download ring tones, MP3 files and videos when they are shopping for music, as well as customer reviews of products.
However, we also know that ScanBuy is conducting 'only' manual entry cost comparisons via shopping barcodes at present here in the US. Why then is ScanZoom (ScanBuy's barcode scanning app.) not in full deployment? I suspect that answer has all to do with the cost of a 30-month old formal 'Cease & Decist' order involving a treble damages patent infringement suit notification, issued in Jan., 2004, by NeoMedia's BP&G law firm.
But first, lets take a look at how ScanBuy has evolved and what they have to loose in such an all important law suit. ScanBuy does have a wireless history with a wireless firm know as Western Wireless. My archives are a bit sketchy and most links that I had date back to 2000, which are now outdated. So I'll leave this one up to Success to provide more details if she can.
With that said, the addition of Jonathan Bulkeley, former CEO of Barnes and Noble brings a change to the old way of doing business at ScanBuy. Mr. Bulkeley appears to have taken a more friendly posture with NeoMedia since his tenure commenced last Spring, as opposed to Mr. Olivier Attia's head strong and bullish mannerisms. We know that ScanBuy met with NeoMedia in Ft. Myers immediately after the spring CTIA, which was an eminent first move for Mr. Bulkeley. He is most probably trying to get a grip on the stalled-out launch process involving ScanZoom and he realizes his first order of business is to deal directly with NeoMedia.
Also, lets not forget that ScanBuy eliminated its first law firm and retained a second one. This action immediately signals trouble to the plantiff's counsel. There were even some posts here referencing this law firm and NeoMedia as having conducted business together. Strange bed fellows? I think not! Again, I will defer to Success if she would be so kind as to offer her talents to pull these up.
Secondly, there's Nataly Kogan, VP - Hudson Venture Capital, who brings a hefty $10-Mil. to the table at ScanBuy, with Round-1 funding designated at $5.1-Mil. Will ScanBuy want to risk continued loss of investment capital from Hudson VC if they are found guilty of a patent infringement suit? Again, I think not.
Next, you have OEM backers of ScanBuy such as Nokia & Sony Ericsson who are incorporating ScanZoom technology into their respective handsets. In addition, ScanBuy has been cited as working with the likes of several OEM's. involving Motorola, Panasonic, Samsung, Sendo and Siemens, all of who's phones support Scanbuy's OS technology. Not only has NeoMedia developed its OS to run on numerous platforms, Scanbuy also has developed applications that run on the Symbian OS, Windows Pocket PC, Verizon's Brew and Java. However, will any of these big name OEM's wish to subject themselves to recall if again, ScanBuy is found to be guilty in a full blown patent infringement trial? There is much more at stake here than meets the eye.
ScanBuy is also working with CodiLink, a mobile marketing firm that counts companies like Audi and H&M as clients. CodiLink has licensed ScanBuy’s technology and is building mobile marketing campaigns around it. Mr. Attia has specifically stated that "Within the next 9 to 18 months, Scanbuy's applications will be in 50 million mobile phones." Mind you, these are very powerful words. Right now his company's bar code scanning technology works with about 20 different models.
ScanBuy also has a deal with telecom operator Telefonica, the 4th largest mobile operator in the world to provide small and mid-sized businesses with inventory management applications on their phones. Will all the effort that CodiLink and Telefonica has put into ScanBuy go to waste if ScanBuy is found guilty of patent infringement?
Which brings up the next topic: Neomedia's patents and their respective 'global' jurisdictional footprint. We know that NeoMedia has 27 approved patents with another 51 pending, bringing their total to 88. The EPO further recognizes 10 country's as extending the patents for NeoMedia’s core technology of automatically linking bar codes and other unique identifiers to content on the Internet in all countries involving North America, Austria, Belgium, France, Germany, Liechtenstein, Luxembourg, the Netherlands, Sweden, Switzerland and the UK, with Asia and China soon to follow. NeoMedia made the first move with its patents commencing back in 1995 and has established itself as the leader in connecting the physical world to the electronic world.
IMHO, the reason why ScanBuy has not fully deployed ScanZoom here in NA and area's involving the EPO designee's cited above is because of the 'prowess' of Neomedia's patents. ScanBuy has towed the legal line and will not cross over it. Subsequently, ScanBuy will conduct 'only' manual entry cost comparisons shopping UPC codes while ScanZoom sits idle. Is there a closed door agreement between NeoMedia and ScanBuy allowing ScanBuys scan-shop app. to be functioning here in the US? We don't know. However, ScanZoom is in full deployment in Portugal at a 'major' fast food eatery while we await our next MarkMan hearing, here in the US, on Oct. 30th.
The bottom line is that the mobile marketing arena is a new space which has yet to be carved up. Its like a pie waiting tobe served and NeoMedia has claims on its ingredients by way of its patent portfolio. NeoMedia would be served best if the ScanBuy case went full court and NeoMedia was declared the victor. They would then be the undisputed heavy weight in the mobile content world. ScanBuy intuitively knows this. ScanBuy also knows how much they have to loose by loosing a hotly contested court battle...which is why I believe Neomedia and ScanBuy will eventually be conducting business together, but with NeoMedia squarely in the patented drivers seat. All NeoMedia has every really wanted was the toll to cross over their Bridge, and a handsome toll they will be paid. Remember, "let the others do the heavy lifting."
All the Best, JP
