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Is Zynga Trying To Patent Virtual Currency? 89

Posted by timothy from the start-with-virtual-cowry-shells dept.
sarysa writes "Techcrunch spotted a recent patent application by Zynga, attempting to patent virtual currency purchased with real money for use in a gambling context. It is unlikely that the application will pass due to a plethora of prior art where free MMOs that have gambling minigames would qualify, but Techcrunch also spotted that the application mentions Farmville as an example of embodiment. This indicates that Zynga may be attempting to patent non-refundable virtual currency as a whole. Should be interestering to see how this develops."
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Is Zynga Trying To Patent Virtual Currency? More

Is Zynga Trying To Patent Virtual Currency?

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  • patents = virtual currency (Score:5, Informative)

    by ciaran_o_riordan ( 662132 ) on Saturday October 23, 2010 @10:49AM (#33996406) Homepage

    It's like the IPv6 problem.

    Many people can see that this is something that will be a key element of future society. It's just a matter of patenting as many related ideas now and waiting for them to come into use.

    * http://en.swpat.org/wiki/Webpage_and_web_service_patents [swpat.org]
    * http://en.swpat.org/wiki/Invalid_patents_remain_unchallenged [swpat.org]
    * http://en.swpat.org/wiki/Patent_trolls [swpat.org]
    * http://en.swpat.org/wiki/Divine_e-commerce_patents [swpat.org]

    • This will be the end of societies that allow themselves to become mired like this.
      Take India for example. Generic drug industry = I DRINK YOUR MILKSHAKE!

  • The problem with software/computer related patents is two-fold. The first: Is it truly unique, or is it only unique because it involves a computer? The second is the plethora of prior art available for most so-called unique implementations.

    Those two problems have a root cause:
    The USPTO does not have (any or) enough patent/trademark clerks to really search out all instances of prior-art and because of the large back log are encouraged to just rubber stamp everything they come across if /they/ (who could be b

    • Make the USPTO liable for invalidated patents? (Score:5, Interesting)

      by Alwin Henseler ( 640539 ) on Saturday October 23, 2010 @11:43AM (#33996732)

      The USPTO does not have (any or) enough patent/trademark clerks to really search out all instances of prior-art and because of the large back log are encouraged to just rubber stamp everything they come across if /they/ (who could be below-average in knowledge about a particular field) don't know of any prior art off-hand.

      How about making the USPTO pay the legal bill whenever a patent is invalidated through the court system?

      That way, there'd be no immediate punishment for granting bullshit patents. Patents that aren't challenged, wouldn't affect the USPTO's bottom line. But (if successful) would make it free for the challenging party to invalidate a patent. It would be a great incentive to watch general quality of issued patents, and perhaps hire enough people / raise fees to cover the actual required effort. If an important patent means a bigger legal bill when invalidated, that would help to pay more attention to patent applications with (potentially) wide impact.

      I'm not a fan of patents in the 1st place, but weeding out the many nonsense-patents that are on record, would be a good start. Especially those nonsense-patents that patent trolls uses as beating stick, and that cost society a lot more (down the line) than hiring a few qualified patent clerks.

      • I don't know. The US Government already gets an automatic, royalty-free grant on patents and copyrights IIRC. Wouldn't this idea be counter-intuitive in that regard?

      • The problem is if you hold the USPTO liable, the net result is that the profits dwindle within a government organization. And yes - the USPTO is the one government department that is net profitable (besides the IRS of course.)

        If you let that happen, sure the USPTO will "pay" for it, but it will pay for it by sending less money to other branches of the government... which WILL get that money from somewhere - let's face it.

        If that's the case you'll end up with either more government debt or higher taxes

      • Wouldn't this sort of punishment at it's root punish tax payers for the USPTO granting bogus patents? I don't know about you, but I don't want to pay for the legal fees of company X who challenged Y's patents and won.

        • I'd much rather hold the examiner *personally* liable.

          If not completely, then enough to sting. ...

          Who the hell am I kidding? The USPTO is bought and paid for just like every other branch of government.

    • I've been able to buy non-refundable virtual currency for years [google.com].

      The only difference here is "on the internet" (the magic phrase that guarantees that a patent will be granted).

      • Re:The Problem (Score:5, Interesting)

        by EvilIdler ( 21087 ) on Saturday October 23, 2010 @12:23PM (#33997028)

        I think banks were even earlier. They started making metal/paper tokens with different values on them, and eventually evolved into an elaborate system handled by the governments around the world. The money on my Visa debit account feels pretty virtual too.

  • The Major BBS circa 1990 and poker. (Score:5, Interesting)

    by Joe U ( 443617 ) on Saturday October 23, 2010 @11:06AM (#33996514) Homepage Journal

    The Major BBS by Galacticomm had a multiplayer poker game where you converted credits you bought for general use (usually used for metered online time) into poker chips, with the ability to win more credits.

    Now I'm not a patent lawyer, but this paten sounds exactly, and I mean exactly like how we used to play.

    • Re: (Score:3, Insightful)

      by Charliemopps ( 1157495 )
      I believe natives trading seashells and shiny stones as money predates your example by a couple of million years. Trading something that has no value for something that does, simply because we as a society have decided that thing is a virtual representation of wealth is the foundation of modern society. Money, by its very nature, is virtual.

    • Re: (Score:2)

      by cHiphead ( 17854 )

      Ding Ding Ding. Also, Drug Wars web based game circa 2000-2002

      • Re: (Score:2)

        by rtb61 ( 674572 )

        You want old prior art. A lot of you young fellas might never have seen them but thirty odd years ago electronic card poker machines were all the rage. Put multiples of twenty cents in and it would convert it into a non-refundable credit allowing you to play until your credits ran out. Although is was legal is some locations for them to payout, it was illegal in many locations hence you just played to play not to win http://en.wikipedia.org/wiki/Video_poker [wikipedia.org]

        • Pachinko machines circa 1920 ?

          Real currency is exchanged for virtual currency (balls) that can be played in the machines. The machine pays out winnings of more balls. Officially / legally, these balls cannot be exchanged back into real currency, although it does happen courtesy of the local Yakuza mafia who will have an exchange center close to (but not in) the same location as the machines.

          Kind of parallels the whole Gold Farming / Selling websites that abound in MMOs chat screens. The Internet mirrors rea

    • The Major BBS by Galacticomm had a multiplayer poker game where you converted credits you bought for general use (usually used for metered online time) into poker chips, with the ability to win more credits.

      Now I'm not a patent lawyer, but this paten sounds exactly, and I mean exactly like how we used to play.

      Did you have the ability to redeem your winnings, say for more metered time online? Then it's not prior art. Read the claims. They specify that the credits cannot be redeemed.

      • So the "invention" is removing the ability to redeem your winnings? Not really patentable subject matter is it.

        • So the "invention" is removing the ability to redeem your winnings? Not really patentable subject matter is it.

          Without delving deeper into it, I couldn't say. What I'm trying to get at is that there are two different requirements for patentability:
          First, the invention has to be new. No one else has done it before. This is where people can legitimately shout "prior art" if the prior art includes each and every element of the claims.
          Second, the invention has to be nonobvious. So even if it's new - no one has ever tried a pickle and potato chip sandwich before - it may be an obvious combination of potato chip sammich

          • First it has to be an invention. Then you can worry about whether or not it is new or non-obvious. I'm not really convinced that this is an invention.

            A patent may be granted for "any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof". Does chopping the last stage off an existing process qualify? I doubt it.

            • First it has to be an invention. Then you can worry about whether or not it is new or non-obvious. I'm not really convinced that this is an invention.

              A patent may be granted for "any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof". Does chopping the last stage off an existing process qualify? I doubt it.

              There are three requirements in 35 USC 101. You're incorrectly trying to ignore two of them, with your statement "first it has to be an invention, then you can worry about whether or not it is new or non-obvious."

              The three requirements are that the claimed invention comprise patentable subject matter - process, machine, manufacture, composition of matter, or an improvement thereof; be new and nonobvious, which I discussed above; and be useful, which is a different discussion entirely.

              When you say "first i

              • This post is "new". Nobody has ever made a post quite like this one before. Is it an "invention"? I doubt it. Could I get a patent on it? Almost certainly not. Copyright, yes, but not a patent.

                • This post is "new". Nobody has ever made a post quite like this one before. Is it a "copy"? Absolutely. Could I get a patent on it? Almost certainly yes, as it's just sufficiently different (99% existing text, 1% new text) to claim "invention".

                  It's STILL a blatant ripoff of the parent, but hell, this kind of "invention" is what has kept the pharma companies in gold plated toilet seats since the patents of the REALLY useful drugs ran out years ago.

                  Bang a new molecule onto an existing complex chain, claim it

                  • Thing is, to make a "derived work" in the patent realm, you need a license for the patent you're deriving from.

                • This post is "new". Nobody has ever made a post quite like this one before. Is it an "invention"? I doubt it. Could I get a patent on it? Almost certainly not. Copyright, yes, but not a patent.

                  Yes, and is your post a "process, apparatus, composition of matter, or article of manufacture, or improvement thereof"?

                  No. Go back and read the statute. Don't just make up arguments because they sound good in your head.

        • Yeah, it's like removing the sideview mirror from my car, and then suing the car manufacturer because I have a patent with claim "235. car with sideview mirror removed".

      • Re: (Score:2)

        by julesh ( 229690 )

        Did you have the ability to redeem your winnings, say for more metered time online? Then it's not prior art. Read the claims. They specify that the credits cannot be redeemed.

        They only specify that they can't be redeemed "for legal currency". As doing so would be illegal in most states of the US, I would imagine few BBS operators would have been willing to do this. Winning more metered time would count as a "virtual currency [that] is not redeemable for legal currency" and therefore matches the claims, an

        • Re: (Score:2)

          by Joe U ( 443617 )

          They only specify that they can't be redeemed "for legal currency". As doing so would be illegal in most states of the US, I would imagine few BBS operators would have been willing to do this. Winning more metered time would count as a "virtual currency [that] is not redeemable for legal currency" and therefore matches the claims, and is prior art.

          Since online time was sold as credits, which you consumed at about 1 per second, and could purchase virtual items with, (poker chips, game time, etc) I would say it was absolutely a virtual currency.

          • Re: (Score:2)

            by julesh ( 229690 )

            Yes, but to invalidate the claim that this is prior art, you have to be able to sell it back to get *legal* currency, e.g. US dollars. Could you?

  • Sites such as http://www.jingobid.com/ [jingobid.com] swoopo.com and mad bid have been doing this for ages in the form of non-refundable 'bids' which are the current used for participating in the auctions. Fat chance getting that kind of a patent through. The unified currency makes it easier to accept multiple currencies at a fair rate.

  • prior art (Score:2, Interesting)

    by marcello_dl ( 667940 )

    Back when precious metals were the currency, fiat currency is virtual currency.
    If we want to stick to the IT field, with fractional reserve banking and dematerialization, normal currency is even more virtual than virtual one. The world is under the spell of numbers in a computer.

    Patents on one side, pirate parties pushing for the complete removal of copyright on the other side... Both options would make people poorer, the second one seems the less troublesome but something in the middle would be the best: y

    • Re: (Score:1, Interesting)

      by Anonymous Coward

      pirate parties pushing for the complete removal of copyright on the other side...

      Please: don't fall for the FUD (I know, I know: media tend to portray that this way, but media aren't neutral parties to this fray).

      Picking one random example [pirateparty.org.uk]. An abstract:


      We will legalise use of copyright works where no money changes hands, which will give the public new rights [...]


      Counterfeiting, and profiting directly from other people's work without paying them, will remain illegal.

      Fear not. No complete removal of copyright in sight.

  • and what does that mean exactly ? what will happen is, eventually them or some other greedy pigs are going to patent something like this somewhere, and attempt to enforce it through international treaties. for, this is what patent system is : giving ownership of logic concepts to individuals. no different than letting a lord own a river and toll anyone who passes over it.
  • Hopefully this doesn't (directly) affect anyone reading this. As in, I hope you're not wasting your money.

    • Re: (Score:2)

      by julesh ( 229690 )

      Not quite sure how running an offshore online casino counts as "wasting your money". I hear it can be quite lucrative.

  • Fools (Score:4, Insightful)

    by Greyfox ( 87712 ) on Saturday October 23, 2010 @11:23AM (#33996602) Homepage Journal
    ALL currencies are virtual. They have only the value that a group of people assign them.
    • I was thinking along some what similar lines myself.

    • Re:Fools (Score:4, Insightful)

      by julesh ( 229690 ) on Saturday October 23, 2010 @02:31PM (#33997846)

      ALL currencies are virtual

      The application defines "virtual" as meaning "usable within the context of a computer-implemented game".

      • Re: (Score:2)

        by Greyfox ( 87712 )
        Since "The Matrix," reality qualifies...

      • Re: (Score:1, Interesting)

        by Anonymous Coward

        I can use real money in a "computer-implemented" poker game online. Or in a "computer-implemented" slot machine. So real money neatly fits their definition.

  • It must be nice to work at the patent office. If you're doing a good job, your boss will be happy with you. If you're doing a bad job, you will feel happy about yourself. Win-win situation.

  • Facebook v. Zynga (Score:4, Interesting)

    by schmidt349 ( 690948 ) on Saturday October 23, 2010 @11:28AM (#33996634)

    It seems to me that Zynga is trying to end-run Facebook's attempt to take control of virtual currency transactions in Facebook apps. If they can get a patent on virtual currency, they can try to extort a big fat patent license fee from Facebook or otherwise escape the new Facebook Credits.

    It will be interesting to see if Facebook contests this patent application.

    • Don't forget gaming platforms. Wouldn't Xbox Live points fall under this? Or MMO microtransation currency, like NCCoin?

  • I've been using virtual money ever since I was able to pay for this directly from my back account without the need to convert it to real money first. Of course instead of using a new name and symbol thingy my bank simply used the same name and symbol as the real money, and applied a 1:1 conversion ratio.

    • A 1:1 conversion ratio ? Your bank will let you do international bank-to-bank transfers with NO charges for you or the receiving party ?

      Please, tell me the name of your bank, I'll open an account tomorrow.

  • Well you know what they say...A fool and his money are soon parted. I have never understood it myself, but evidently I didn't give fools enough credit...there are far more of them then there are people who actually think before spending. Its kind of shocking how many will play that stuff though, I signed up for facebook specifically at the request of my mother since according to her "all my relatives are on there". So far there is far less communication than there is updates on when aunt lisa got a new p

  • I ran the first SL casino 4 years before that. (Score:3, Interesting)

    by eggstasy ( 458692 ) on Saturday October 23, 2010 @11:47AM (#33996766) Journal

    Zynga was founded in 2007, Facebook was founded in 2004, I ran a virtual currency casino in 2003, and even before that, there were already some standalone slot machines built by Linden Lab itself. WTF? :)

    • Magic the Gathering Online went live in 2002. You buy "tickets" which you can use to trade, enter tournaments, etc. And you can win stuff playing those tournaments. I'd say that falls under the gambling with virtual currency category.

  • This patent should fail on two counts, not only is there prior art but this patent is obvious, not only to an expert in the field, but to a complete novice in the field.

  • Our "real money" is as virtual as the virtual currency.

  • "virtual currency purchased with real money for use in a gambling context" Isn't this the definition of an online casino chip? Maybe prior art?

  • Stupid Question (Score:3, Interesting)

    by Pop69 ( 700500 ) <billy&benarty,co,uk> on Saturday October 23, 2010 @03:57PM (#33998510) Homepage
    Has anybody actually read the patent application or is everyone too busy trolling their point of view on patents in general ?

    I read it and as far as I can see the "innovation" is that you can't convert the virtual currency back into real currency. It's a bit thin and too generalised to be granted a patent on as far as I can figure out.

    Unless I'm missing something it really is that simple and obvious.

    • Fine, I want a patent granted to me immediately on the Space Shuttle, but with the USA flag removed.

      That's the ridiculousness of the "innovation" that Zynga are claiming here.

  • I hope the prior-artiness of this is obvious even to the Patent Office, but in case not...
    All the claims I read include the qualifier "where the virtual currency is not redeemable for real currency", probably to exclude LindenBucks as prior art. Worst case, you could get around this the same way purveyors of offline virtual currency (coupons, etc.) do to comply/avoid various laws [yahoo.com]. On each virtual token: "Cash value 1/zillionth cent"

  • TFP document is fairly straight forward. From the background section:

    [0007]In the case of gambling-type games, the ability to simply "cash out" by selling to the game operator would, in many jurisdictions, constitute regulated (and possibly illegal) gambling. Furthermore, permitting one player to effectively "cash out" by selling to another player may also run afoul of gambling laws or regulations. Consequently, in some cases, players want to play gambling-style games, but without the regulated gamblin
  • The fact that people have patented even more outrageously stupid shit. At this point, I wouldn't be surprised if they got the patent. Remember that USPTO is no longer taxpayer funded and hasn't been since '93, so their livelihood comes from people filing patents.

  • Don't video poker and other casion games have this and had this for at least 30+ years. When you put cash in one how many times does a number show up under Credits?

  • here are some things that I think flip the bill of previous art though some of these things don't fit with the "on the internet". Subway, Arcade (chuck e cheese anyone?), golf ball machine (at driving ranges) tokens. I don't care if it's online or not though, it's still the same thing... it's a token. The idea of a token has been around forever. But knowing how our patent system works, this will get pushed through somehow. I listed the tokens above because I have witnessed many a token or ticket that on it
  • If they get their patent would that not may our "real" currency virtually worthless? Oh wait it already is but then that would also mean they couldn't print any more money could it? Sorry bad pun.
  • All money is virtual. Coins and notes are storage media, not the thing stored. If you rip a ten dollar bill you don't get dollar coins falling out. At one time a Pound Sterling was redeemable at Her Majesty's treasury for one pound of sterling silver, sterling being a grade of silver. But with the rise of fiat currency, money is a pure abstraction, and the value of it depends entirely on whether you can get others to believe in its worth... a kind of consensual hallucination.

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