Move Networks has received a patent on adaptive streaming from the United States Patent and Trademark Office. The recognition may have come too late for the company, which pioneered video streaming using ordinary web protocols and raised the standard for online video. Created by one of the founders of Novell, its investors included Microsoft, who went on to roll their own competing format. Move Networks is now hoping to find a buyer.

“Move’s adaptive streaming was the breakthrough invention which proved that primetime television programming and professional long form video can be reliably delivered over the internet at the high resolution quality that is intended — despite the unreliable network conditions typically present on the internet,” said Drew Major, the founder of Move Networks. He was previously one of the founders of Novell and the lead architect of the NetWare operating system.

Since Move Networks launched its adaptive streaming solution in 2006, he said “practically every major online video provider — including Akamai, Apple, Adobe, Limelight, Microsoft, Netflix, Widevine and several others — has deployed an adaptive bit rate architecture inspired by our invention.”

The awarded patent covers the encoding and use of multiple bit rate “streamlets” with the same time index, such that a client device can intelligently request successive streamlets, stored on standard web servers. It is one of a number of patents previously filed by Move Networks.

Although adaptive bit rate streaming was used before, the main innovation of Move Networks lay in the use of multiple files or streamlets which could be requested using standard HTTP web requests and served from ordinary web servers, rather than special streaming servers, and could consequently be cached.

The technique has certainly been adopted by companies including Adobe, Apple and Microsoft. Adobe offers HTTP Dynamic Streaming, Apple has HTTP Adaptive Streaming, and Microsoft promotes Smooth Streaming. As yet there is no universal standard approach.

Move Networks was used by major broadcasters including ABC and FOX, but required users to download and install a special plugin to play video. This was a major limitation in comparison to more widely adopted plugins from Adobe and Microsoft.

In the face of fierce competition, Move Networks struggled and at the end of June 2010 announced that it was seeking a buyer. Former DirectTV chief operating officer, Roxanne Austin, stepped down as president and chief executive, replaced by Marcus Liassides, who joined the company when it acquired Inuk Networks, where he was founder and chief executive.

Move has not indicated whether it will attempt to licence or enforce its patent. Its founder simply said he was pleased that its technical achievements have been recognised. “We look forward to continuing our efforts to further the boundaries with similar ongoing technology innovation.”

The patent could be attractive to bolster the portfolio of an acquiring company, possibly one that uses similar approaches. Microsoft was an investor and went on to deploy its own version of adaptive HTTP streaming. It could also be a possible acquisition for Google, which acquired video codec company On2 in a deal worth $125 million earlier this year.

Move Networks was backed by investors including Hummer Winblad and Steamboat Ventures, followed by Benchmark Capital, Comcast, Cisco, Televisa and Microsoft, who between them poured over $90 million into Move Networks in three rounds.

The story of Move Networks is a classic case study that technology alone is not sufficient to build a business and being first, or even best, is not necessarily enough to beat the competition.