Acacia Signs 100th License

Gretchen Gallen
NEWPORT BEACH, Calif. – Acacia Technologies Group reached its 100th licensing agreement for its streaming audio and video media patents Thursday, the company announced. Although only a portion of those agreements are from the adult entertainment industry and many represent deals struck with industries such as hotel in-room entertainment and online movie and music companies.

Acacia's DMT technology relates to the transmission of audio-on-demand, video-on-demand, and audio/video streaming over the Internet, cable television, satellite and wireless systems.

According to Acacia's Senior Vice President of Business Development Robert Berman, the licensing agreements currently signed by members of the online adult world represent nearly 4,000 websites, and the actual licenses that Acacia has on file from adult companies account for upwards of 90 agreements, although Berman did not have an exact number on hand.

Berman told XBiz that on the heels of the Nov. 30 deadline, intended to spur adult companies into action, his company received a flurry of phone calls and emails, some of which Acacia has not yet had a chance to answer.

The November deadline was a last minute olive branch from Acacia to adult webmasters, promising those companies that signed up prior to the deadline significant discounts on back royalties, licensing fees, and a pardon from pending patent infringement litigation.

Those companies that ignored the deadline, according to Berman, will now be charged a new and considerably steeper set of fees and fines, which are now posted on the Acacia website.

To make matters even more challenging for webmasters, Acacia has now tacked on an added fee, referred to as a 'contract administrative fee,' which will start at $500 in January and will climb in $250 increments every month, totaling nearly $2,000 by July 2004.

Berman added that the new fee is obviously an extra inducement to get webmasters to sign up for licenses with Acacia sooner than later, and that he expects the response to be as significant as the November deadline.

However many members of the online adult world who have questioned the validity of Acacia's patent claims privately and legally are suspicious of Acacia's latest licensing bravado compared to the recent slip in its stock and the fact that the legal process between Acacia and a group of adult entertainment counter-litigants has not yet leaned in favor of either party, and particularly not Acacia's.

A Feb. 6 hearing is set for Acacia's legal team and the 13 adult entertainment companies counter-suing the patent holder in which the judge will take the first steps in determining the meaning of the patents and whether they are based on ideas or actual processes. At the last hearing in November, both parties decided on ten terms related to the patents that the judge would begin to examine.

Over the past six months, Acacia's stock has plunged from $8.00 to $5.25 by market close on Thursday.

"If it was me and I sent out 10,000 letters and only got 100 sign-ups, I would seriously consider another line of work," Spike Goldberg of Homegrown Video told XBiz upon hearing Acacia's announcement. "It's an embarrassment."

Greg Clayman, president of Video Secrets and one of the parties involved in the counter-suit against Acacia, said: "I would have been ashamed to announce such a small number of contracts, but I suppose that after making all those threats Acacia had to come out with something to make it look like they're making progress. This of course has no bearing on our case. The train is still coming down the track and it is just a matter of time."