Shout out to Luke Bouma of Cord Cutters News who reported this on Friday.
For a while, when we were all washing our fruit with bleach and sitting at home making sourdough starter, it seemed like Peloton was going to be the darling of the 2020s. I had first become aware of the company at CES back in 2019 or so, and to be real honest, I didn’t get it. Personally the last thing I want when I’m exercising is an interaction with another person. But, millions got on their bikes and Peloton seemed like a surefire winner.
And Just Like That…
I think the first sign of trouble on the horizon was the brouhaha when a totally fictional character died on HBO Max’s And Just Like That after exercising on a Peloton. First of all, I feel compelled to point out that fictional characters can’t be harmed by exercise equipment since the are, I reiterate, fictional. Add to that the character was known to overindulge in alcohol and tobacco, and was in their 60s. But somehow people blamed Peloton.
As more and more of us ventured out of our homes, Pelotons unsurprisingly became coat racks and dust magnets. Now, it seems the company faces another hurdle: patent infringement.
Can’t Sling Without You
In this case, Reuters reports that Peloton and iFit (an interactive app from Nordic Track) both infringed on streaming patents held by DISH. DISH filed a complaint in 2021 claiming that these devices used technology originally created for Sling devices. Sling was a very early leader in adaptive bitrate streaming, allowing for its customers to cast content from anywhere over cellular connections. The company was bought by DISH and integrated into its Hopper DVRs.
In a ruling on Friday, a US judge ruled that DISH’s patents did apply to the way Peloton and iFit were streaming content to customer devices. As a result, Peloton and iFit will be banned from importing new equipment into the US until they either pay DISH or find a way around the patent. As always, the federal government has 30 days to set aside the ban. This would be done if they determined the ban would be too harmful to consumers. Personally I don’t think that applies here.
This kind of case changes history
You might think that patent cases don’t really amount to much. But, there have been two that really shaped the landscape. One even involved DISH.
Way back in the 2000s, everyone wanted a DVR. Remember that at the time most people watched TV completely live since VCRs were hard to program. Suddenly you could pause and rewind live TV and this changed the game.
DIRECTV and DISH jumped on this tech before pretty much any other pay-TV company. DIRECTV bought a company called ReplayTV in order to secure its DVR technology. DISH used their own tech. TIVO, which was a media darling at the time, sued DISH because they believed DISH’s tech was too close to theirs. The result was that TIVO won, but the fight cost them a lot of money. In the end, TIVO became an also-ran in the DVR fight. Rovi bought them for cheap back in 2016.
There’s an even bigger fight that really changed the world, though.
Apple makes history
You might think that Apple invented the personal music player with its iPod in 2001. In fact, others had already been doing digital music for several years. Among them was a company called Creative, which led the digital music revolution back in the 1980s. Here’s the issue. Apple rolled out a menu on its iPod that looked like this:
And you see, Creative already had digital music players whose menus looked like this, and they patented the menu system:
In 2006, a judge ruled that Apple’s menu design did in fact infringe on Creative’s patents and ordered Apple to pay $100 million to Creative. That wasn’t a lot of money for Apple but it rankled Apple’s Steve Jobs enough to accelerate development on a new portable device that wouldn’t use Creative’s menus. That device, of course, became the iPhone. While iPhone was certainly not the first smartphone, it certainly changed the world of cellular communication.
The point here is that patents matter. They aren’t just pieces of paper that companies use to make money off other companies.
Where we go from here
First of all, if you’re a current Peloton or iFit user, nothing will change. Your device will work as a hat rack just as it does now. This ban only affects new imports.
As I said, the federal government could set aside this import ban in the interests of serving the most people. I don’t think they will. I think these companies will go the traditional route, paying DISH until they can engineer solutions that don’t infringe on DISH’s patents. Still, it should be interesting to see the effect this has on Peloton especially, a company that just doesn’t need more bad news at this point.
