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March 1, 1999

CENTRAAL & NETWORDS PATENT SPAT ROLLS ON

By CBR Staff Writer

By Nick Patience

It appears that there is still life left in the spat between the two main rivals offering natural language alternatives to the current URL system in browsers. In mid-January Centraal Corp, purveyor of the RealNames system prevailed in a patent infringement case brought against by its rival Networds LLC, after the court ruled that the two systems worked in fundamentally different ways, which Centraal had always maintained was the case (01/13/99). Both technologies offer a system whereby users can register meaningful names, either for personal or commercial use that are then mapped on to specific URLs for easier access. Networds had the right of appeal and has exercised it, but Centraal’s founder and CEO Keith Teare says that’s a frivolous claim because the judge issued a ruling that he says leaves no room for doubt. Centraal has sent Networds a letter saying that it considers the appeal to be frivolous and is going to seeking damages for its legal costs. Networds COO Shep Bostin says Centraal can send all the letters it wants, but the letter has no legal standing whatsoever and the company’s attorneys were surprised by the judge’s decision. Networds’ appeal cites specific matters of law where the judge was in error, he says. Teare is promising seriously big stuff coming down the line soon from Centraal. We are expecting at least one deal with a major portal this quarter, following its announcement of a investment from the likes of Network Solutions Inc and Compaq Computer Corp in December and a deal with Inktomi Inc in January. The two systems are aimed at different markets, with RealNames concentrating on brand names and Networds on personal names. But Centraal is, as expected moving in on Netword’s turf and is what Teare calls a quiet beta of its My RealNames system that enables individuals to register a name that is meaningful to them free of charge, provided they are a member of one of 17 web communities, including Tripod, ICQ, GeoCities, iVillage and eBay, among others. Teare emphasizes that brand names and trademarks cannot be registered as personal RealNames. The regular RealNames cost $100 per year. Networds are free when registered through communities such as ICQ and GeoCities, otherwise they cost $5 per month per name. Networds’ Bostin says more than one thousand Networds have already been registered by GeoCities users out of the 2,000-odd Networds in total. Both companies are now involved with work at the IETF to get some sort of standard worked out, which we documented last week (02/26/99)

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