Overture was granted a patent for pay per click search back in July 2001. Yes, Overture invented pay per click search, not Google.
Here’s the patent:
United States Patent 6,269,361
Davis, et al.
Awarded July 31, 2001
System and method for influencing a position on a search result list generated by a computer network search engine
A system and method for enabling information providers using a computer network such as the Internet to influence a position for a search listing within a search result list generated by an Internet search engine. The system and method of the present invention provides a database having accounts for the network information providers. Each account contains contact and billing information for a network information provider. In addition, each account contains at least one search listing having at least three components: a description, a search term comprising one or more keywords, and a bid amount. The network information provider may add, delete, or modify a search listing after logging into his or her account via an authentication process. The network information provider influences a position for a search listing in the provider’s account by first selecting a search term relevant to the content of the web site or other information source to be listed. The network information provider enters the search term and the description into a search listing. The network information provider influences the position for a search listing through a continuous online competitive bidding process. The bidding process occurs when the network information provider enters a new bid amount, which is preferably a money amount, for a search listing. The system and method of the present invention then compares this bid amount with all other bid amounts for the same search term, and generates a rank value for all search listings having that search term. The rank value generated by the bidding process determines where the network information providers listing will appear on the search results list page that is generated in response to a query of the search term by a searcher located at a client computer on the computer network. A higher bid by a network information provider will result in a higher rank value and a more advantageous placement.
Google makes practically all of its money from running paid search ads. This suit is big.
Interesting Google quote about the lawsuit:
“Basically we’ve analyzed the patent and determined that we do not infringe on any valid claim that it contains,” said Cindy McCaffrey, a Google spokeswoman.
Overture sues Google over search patent
By Stefanie Olsen and Gwendolyn Mariano
Staff Writers, CNET News.com
April 5, 2002, 3:10 PM PT