Day: November 20, 2005

The Return of the DataPlay Disc

One of the longest running jokes in storage technology — the DataPlay disc — is apparently back thanks to Ridata, but still leaves the basic question in the air: who would actually be stupid enough to buy this?

In the late 1990s, DataPlay was going to be the Next Big Thing in data storage with a small disc that could hold 500mb of data. People were going to use it for everything from data archiving to playing music — DataPlay even signed agreements with a number of record companies to issue their music in DataPlay format.

It never quite happened for two reasons. First, by the time DataPlay actually shipped a working product — in 2002 — a 500mb disc was no longer as impressive as it had seemed in 1998. At at time when a CD-R could be had for about $1/apiece or less, who was going to pay $10-$20 for a 500mb optical disc?

Second, DataPlay stole the Sony playbook and loaded down the DataPlay with a digital rights management scheme that only an ATRAC afficianado could love. In fact, DataPlay and its partners bragged that the format would replace the CD, whose drawback — in their minds — was that it was so easy to copy. As Talal Shamoon, senior vice president of Intertrust which provided DataPlay with its DRM put it,

This whole music piracy problem isn’t going to go away until the CD dies.

And DataPlay was going to be the CD-killer. Instead the company folded in 2002, shortly after it finally released a working product. Reportedly its DRM schemes ended up killing DataPlay rather than the CD. The effort to incorporate DRM into the player reportedly delayed the introduction of the players by up to 1 year, by which time the company was out of money and found investors were no longer willing to extend it more.

Now there are companies trying to revive the DataPlay format. In its November 2005 issue, Mobile magazine reviewed the Ridata Topy Mini Writer saying,

It takes 20 minutes to burn a CD’s worth of music to a DataPlay disc and the same amount of time to read that data back — roughly one-tenth the speed of the average optical drive. if that isn’t bad enough. DataPlay discs are write-once only, and they cost 10 times as much as a CD-R.

And you thought Zip discs were a lousy format. The amusing thing is seeing some of the companies behind the newest incarnation of the DataPlay picking a poor time to target another media format. Here’s DPHI CEO Bill Almon in April 2005 on one possibility,

Hard-drive based systems like iPod work well for music, but they don’t work well for video yet. And whatever develops, there’s still a need for inexpensive media.

LOL. Even with new owners, DataPlay’s timing just couldn’t be worse.

Source:

Second life for tech companies. Bob Mook, Denver Business Journal, April 4, 2005.

DataPlay Discs Stage a Comeback. Martyn Williams, IDG News Service, October 08, 2004.

Lego Loses Canadian Trademark Lawsuit — Thank Goodness

The other day I mentioned Lego’s longstanding financial problems and why I think it has had such problems earning profits. One thing I left out was Lego’s focus on silly lawsuits. All other things being equal, a company that decides to deal with its competitors in the legal arena rather than the marketplace is a company that has completely lost its direction.

Lego’s trademark lawsuit against rival Mega Bloks was especially egregious. Lego’s patents on its plastic bricks began running out in the 1970s — in Canada it lost its patent protection in 1988.

Rather than try to out-compete Mega Bloks and other competitors, however, Lego has tried to exclude them from the marketplace with ridiculous trademark lawsuits. Since its patent has run out, Lego has claimed that it has a trademark on the look and feel of its plastic bricks, and that any companies that make plastic bricks compatible with Legos are violating that trademark.

The Canadian Supreme Court unanimously rejected this bizarre line of reasoning, correctly noting that,

Trademark law should not be used to perpetuate monopoly rights enjoyed under now-expired patents.

. . .

The fact is . . . that the monopoly on the bricks is over, and Mega Bloks and Lego bricks may be interchangeable in the bins of the playrooms of the nation — dragons, castles and knights may be designed with them, without any distinction.

Unlike the privately-held Lego, which is bleeding money, the publicly traded Mega Bloks recently posted a $20.4 million profit in the 3rd quarter of 2005. On the other hand, the general view among plastic brick aficionados is that Lego bricks are much higher quality and Mega Bloks are, in general, cheap Lego knock offs.

Also some of the stories referenced here incorrectly state that Mega Bloks bricks are not compatible with Legos. Mega Bloks, like Lego, manufactures a number of different sized bricks, and its “Micro” bricks are, in fact, compatible with standard Legos.

Sources:

Mega Bloks wins SCOC ruling on Lego trademark. CBC News, November 17, 2005.

Lego can’t block toy maker Mega Bloks, says Supreme Court of Canada. Allan Swift, Canadian Press, November 17, 2005.