Patent May Threaten E-Privacy

A Seattle company says that pending patents will require anyone using Web privacy technology P3P to pay the company royalties. That could have wider repercussions. By Chris Oakes.

The future of a key Web standard that would give consumers control over their online privacy hangs in the balance after news emerged that an entrepreneur will likely be awarded a set of patents on the technology.

The technology, the Platform for Privacy Preferences (P3P) is critical to the Internet industry's current effort to show the US government that it can look after the interests of consumers. The specification was to be used in the next versions of America Online, Netscape Communicator, Microsoft Internet Explorer, and many other software products and Web sites.

"If somebody owns [P3P], they can prevent other people from using it," said Deirdre Mulligan, staff counsel for the Center for Democracy and Technology.

"We put all this work into something that works, then who knows if it's going to get out there."

At the core of the issue is one man, Drummond Reed, CEO of Intermind. Reed said that the US Patent and Trademark Office is expected to issue his company a patent on the idea of P3P.

Intermind was, until July, a member of the standards group that is collectively developing P3P. He resigned when word spread among the members that he would likely be awarded patents on technologies affecting a broad category of "automated information exchange using software objects."

That sounds very much like P3P. The standard is meant to provide a way for consumers and the Web sites they visit to automatically negotiate what can and can't be done with any personal data collected by a site. The technology would reside within both Web browsers and Web sites.

On a document on the Intermind Web site, Reed said that his company would request a minimum royalty of US$50,000 per year to a maximum of $2.5 million from companies implementing P3P, plus 1 percent of all revenues directly associated with the technology.