Apple corners e-commerce, or just revamps iTunes gift cards?

Back in May of 2006, Apple drew up a patent application about a method to improve the way that free song credits were being handled at the iTunes store. Nearly six years later, the USPTO granted Patent 8,112,360 -- which, loosely interpreted, could potentially allow Apple to claim a large portion of the e-commerce market.

The references cited in the document are concerned with redeeming gift cards and free song codes, but Apple was apparently unhappy with the fact that "free song credits are only usable to purchase songs." Additionally:

"When songs are offered for purchase at more than one price and at different prices and/or currency in different countries, there are complications in ensuring that the free song credits are properly used. Thus, there is a need for improved approaches to managing utilization of free credits at an online media store."

Going by the summary example, one might expect to see a method of reconciling real currency with the value of an iTunes gift card (or "bottle cap, or the like"). However, the various examples embodied in the detailed description quickly surpass the mere redemption of promotional song codes.

In fact, they seem open enough to describe nearly any purchase of digital media -- and, as is customary for patent applications, the door is opened even further because "the invention extends beyond these limited embodiments."

In fact, one could very well get the idea that Apple is attempting to patent any sort of purchase at any "digital media store" -- or potentially any digital marketplace, including transactions involving Facebook credits and digital goods within a Zynga game.

This is the crux of the matter, whether Apple filed this patent in good faith for a non-obvious method, or if this is a case of overpatenting -- in other words, a company with considerable resources filing copious patents of questionable validity.

A company might do this in order to strengthen its position in the marketplace, either passively (by strategically establishing a range of defensive patent holdings) or aggressively (by filing suit against weaker competitors with the goal of extracting a settlement or license).

Now, there are a number of limiting factors. The patent states repeatedly in the claims that this is a matter of CREDITS; as most online merchants and services use currency-based transactions (credit and debit cards, banking and PayPal accounts, etc), this doesn't seem to be much of an infringement threat.

Additionally, there is the inclusion of language about certain checks that the described method must make -- country of origin, for one, which ties in nicely with the initial goal of the patent application.

There is also a curious emphasis on "determining whether the purchaser has at least one item credit available at the online media store," which seems to imply that a simple exchange of currency for credit is outside the scope of the patent (as is showing up just to grab a free song).

Prior art assertions, even for a narrow interpretation, need only look to any pre-2006 examples of digital media made available via credit/ code/ 'password' reimbursement promotions -- or even at 'virtual marketplaces' (such as World of Warcraft or Second Life) for a broader interpretation of "digital media assets".