Circuit City's DIVX Patents Fetch $750,000


Needham, Mass. - Circuit City's ill-fated

Digital Video Express

(DIVX) pay-per-play DVD format from the 1990s is back in the news more than a decade after its demise.

The Circuit City Stores Inc. Liquidating Trust entered into an agreement to sell its remaining patent portfolio, consisting primarily of Digital Video Express patents, to Imaging Transfer Co. for a cash price of $750,000, subject to better offers.

Competing bids are due by Aug. 12, and an auction will be held on Aug. 16, said Streambank, the company hired by the trust to sell the portfolio. The portfolio consists of 22 U.S. patents and patent applications as well as multiple related foreign patents.

 The DIVX technology "remains relevant to the areas of compression, distribution, security, usage tracking of movie content, anti-piracy, digital media and watermarking," Streambank, based here, said.

 The Circuit City-backed technology was


when it hit the market in the late 1990s soon after the launch of the DVD format. Many in the industry feared it would confuse consumers and drive them away from the purchase of any DVD player, and many retailers were unwilling to support a technology whose sales would bolster a rival's bottom line. In 1999, Circuit City pulled the plug on the format.

 Developed as an alternative to driving to video-rental stores to return discs, DIVX-enabled discs could be purchased at a price allowing for an initial 48-hour viewing period on DIVX-enabled DVD players. Consumers could purchase additional 48-hour viewing periods or pay for unlimited viewing. DIVX-enabled DVD players could also play regular DVD discs.


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