How Gates's Priceline Spat Could Be Really Big

  • Share
  • Read Later
Priceline.com thinks it can name its price with Bill Gates. The e-shopping site says a name-your-own-price hotel finder on Microsoft’s Expedia travel service violates a broad patent it holds on the technology, and it’s suing the boys in Redmond for monetary damages and an order shutting down the Expedia service. The suit may befoul Microsoft’s attempts to take the subsidiary public as a spinoff, but TIME Digital writer Lev Grossman sees this suit as part of much bigger problem. "This kind of price-comparison technology is the next big thing for the Web and e-commerce," he says, "and the early patents that have been issued –- like the one Amazon.com won yesterday — may be too broad to be practical. Everybody wants to have a version of this on their site, and there are going to be an awful lot of lawsuits like this."

Priceline cofounder Jay Walker obviously hopes he’s got the clout to get Gates to pay the duty, in the same way that Intel exacts fees from Motorola and other rivals for its patent on chip technology. Priceline said they offered Gates a similar out — and was rebuffed in classic Gates fashion. "On being informed that Priceline.com considered its patent rights to be a competitive advantage, Mr. Gates became very agitated and told Mr. Walker that he would not allow patents to stand in the way of his business objectives," the complaint reads. "He announced that many companies were currently in the process of suing Microsoft for patent infringement and effectively suggested that Priceline could get in line with all the others." Thanks to the patent office, lines like that are likely to be forming all over the industry –- and the next batch of dot-com whiz kids could make zillionaires out of their lawyers, too.