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Rewarded Video — What Does Verasity’s Latest Patent Mean?

Verasity
Verasity
Published in
6 min readDec 28, 2022

Recently, we announced that Verasity had secured a patent for rewarded video in the world’s largest advertising and media market, the United States.

That patent, and its full contents, can be viewed here. However, with some 87 associated documents, we wanted to write this short article as an easily accessible resource on our patent for rewarded video, an overview of the patent process, and what it may mean for Verasity.

To get started, let’s discover exactly what our latest patent is for, and the technology it’s associated with.

What does Verasity’s latest patent cover?

Verasity’s latest patent covers a method and system for ‘Rewarded Video’.

Rewarded video is a type of video format in which a user is offered a reward, such as in-game currency or other benefits, in exchange for watching a video, which may sometimes contain an advert. This type of advertising is typically used in mobile games and other applications, and it is designed to incentivize users to watch the video by offering them something in return.

Rewarded video and rewarded ads are typically short and non-intrusive, and they sometimes allow users to continue using the app or game while the video is playing. The reward is typically delivered to the user after the video has finished playing, and the reward is often directly integrated into the app or game itself. Rewarded video is a popular format because it can help to increase user engagement and can provide an extra revenue stream for app developers and game makers.

In these games, users are often given the option to watch a short video in exchange for in-game currency or other benefits, such as extra lives or power-ups. Rewarded video is also commonly used in other types of apps, such as music streaming apps and fitness apps, to provide users with access to premium features or content in exchange for watching a video which usually contains an advert.

In the U.S. alone, spending on rewarded video has been projected to grow to $4.2B by 2024, and according to Statista the majority of this will be in return for in-game currencies. So, this rapidly expanding market is of key importance for Verasity’s advertising ecosystem. Let’s discover the steps required to achieve patent approval in the U.S.

The U.S. patent approval process — Rejections and Approvals

Patent approval is a lengthy process. In the United States, the process for obtaining a patent begins with the submission of a patent application to the U.S. Patent and Trademark Office (USPTO). The application must include a detailed description of the invention, as well as any relevant technical information and diagrams. After the application is submitted, it is reviewed by a patent examiner, who will determine whether the invention meets the criteria for a patent.

If the examiner determines that the invention is novel and non-obvious, and is useful in some way, the application will be approved and a patent will be issued. The patent will grant the inventor the exclusive right to make, use, and sell the invention for a period of 20 years from the date of the application.

Some of our community have asked why patent rejections are included in our recent patent. Occasionally, patents can be rejected before they are re-approved at a later date. A patent rejection is a decision by a patent examiner that an invention does not meet the criteria for a patent in its current form. In the case of our patent for Rewarded Video, the 101 rejection refers to 35 U.S.C. Sec. 101, which is related to what is known as “Subject Matter Eligibility.”

This can happen for a variety of reasons, but usually it means narrowing the scope of the original patent to make it ‘non-obvious’. In other words, there are certain things by their very nature that are not patentable. In this case, as Verasity’s rewarded video solution is a software-based invention, the rejection originally claimed that the patent dealt with an ‘abstract idea’. However, what is important to note is that Verasity’s patent attorneys successfully argued that the claims were directed to more than simply an abstract idea, and the examiner agreed — hence the patent receiving approval. Almost all software-related patent applications receive these initial rejections, and there is currently a bill in congress to try to address this pitfall of the patent process.

In the event of a rejection, the inventor has the option to appeal the decision and try to have it overturned. This is done by submitting a response to the USPTO, explaining why the examiner’s decision was incorrect and providing additional evidence to support the patentability of the invention. If the appeal is successful (as was the case with Verasity’s Rewarded Video patent), the rejection will be overturned and the patent application will be approved. Patent applications that are not novel or non-obvious are not approved, which means that the patent ‘System and Method for Reward Video Viewing’ applied for by Verasity was found to be sufficiently new and sufficiently non-obvious to be worthy of its own patent.

Verasity first filed claims for its rewarded video technology in November 2018, taking some four years to achieve patent approval in 2022. This will potentially have an impact on how and from which parties Verasity can seek license fees, given that Verasity’s particular method of rewarded video had been patent pending for four years.

Asserting Our Patent and Seeking License Fees

When a patent is granted, owing to the lengthy approval process, it is presumed to be legally valid in that jurisdiction. A counterparty can challenge the validity, but the burden of proof is on the counterparty to prove a patent is not valid — difficult to prove in practice. If you have a patent for an invention, you have the exclusive right to make, use, and sell the invention. This means that technically, you can demand license fees from anyone, or an entity, that wants to use your invention without your permission.

A license fee is a fee that a person or company pays to use your invention, and it can be a one-time fee or an ongoing royalty payment based on the sales of the product that uses your invention. When a patent is infringed, the patent owner has the right to seek compensation from the infringer, and this can take the form of a licensing fee.

There have been many successful examples of licensing fees being paid as a result of patent infringement. For example, in 2013, Google agreed to pay Rockstar Consortium a licensing fee of $900 million for infringing on Rockstar Consortium’s patents related to search and advertising technology. In another example, in 2019, Qualcomm agreed to pay Apple a licensing fee of $4.7 billion for infringing on Apple’s patents related to wireless technology.

Whether license fees were owed would naturally be on a case-by-case basis according to how similar a live product is to a patent, and if it was in use before your patent was pending — influenced by information associated with a patent, known as ‘prior-art’. If there are a lot of prior art references cited by the examiner in the application, this is generally viewed by patent lawyers as a good thing. The more prior art an examiner reviews during examination, the better, as it is more difficult for defendants to challenge a patent based on prior art that an examiner has already considered, and it limits the options of a counterparty to challenge a patent. Therefore, if an existing method for rewarded video is sufficiently similar to Verasity’s patent, there will be a case to request license fees.

In almost all cases, when a patent is asserted against an infringer, an infringer will attempt to challenge the patent at the USPTO via a process called ‘Inter Partes Review (IPR)’. The challenges are handled at the PTAB (Patent Trial and Appeal Board), which is part of the USPTO. Verasity is well placed to handle such challenges and will look to maximise the value we derive from our patents.

What will this mean for Verasity?

If a company has a patent for an invention, it has the exclusive right to make, use, and sell that invention.

In Verasity’s case, our rewarded video patent now allows us to sell our solution, or seek license fees, for our rewarded video method and system through license agreements, opening up a new — and perhaps the most significant yet — commercial opportunity for Verasity.

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Verasity
Verasity

Written by Verasity

6.6K Followers
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Advertising technology based on open-ledger principles. We have the first patented adtech protocol on the blockchain — VeraViews

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