# US 2014/0195369 A1 · System and method for a hybrid clock and proxy auction

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- Number: US 2014/0195369 A1
- Document ID: US20140195369A1
- Status: Published application
- Kind: A1
- Application number: 14/195,579
- Filed: 2014-03-03
- Published: 2014-07-10
- Earliest claimed: 2003-11-06
- Inventors: Lawrence M. Ausubel; Peter C. Cramton; Paul R. MILGROM
- Web page: https://patentgrep.com/patent/US20140195369A1

## CPC

- G06Q 30/08: Auctions
- G06Q: INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR

## Abstract

This invention defines a computer system for conducting an auction of a plurality of items including outputting prices for items, receiving bids, outputting updated prices and receiving further bids and then determining an allocation of at least one of the items.

## Claims

### Claim 1

A system, including a first computer and a communication interface, said communication interface enabling communication between said first computer and one or more remote computers, said system for determining an allocation of a plurality of items to a plurality of bidders in an auction wherein bids are received and an allocation of the items to the bidders is determined at the first computer, said system comprising:
a) means for conveying prices for the items;
b) means for receiving at least one bid from at least one bidder at the first computer, said bid comprising an indicator of quantity for at least one of the items at the conveyed price;
c) means for conveying updated prices for the items;
d) means for receiving at least one further bid from at least one bidder at the first computer, said bid comprising an indicator of quantity for at least one of the items at the conveyed updated price; and
e) means for determining an allocation of the items at the first computer based on selecting a combination of received bids that optimizes revenues subject to a constraint that the selected combination of received bids is feasible.

### Claim 2 (depends on 1)

The system of claim 1 which further includes means for updating prices based on the history of received bids and the available quantities.

### Claim 3 (depends on 2)

The system of claim 2 wherein the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 4 (depends on 1)

The system of claim 1 which further includes means for applying an activity rule that limits current bids based on prior bids.

### Claim 5 (depends on 1)

The system of claim 1 wherein the means for receiving at least one further bid includes means to constrain bids by a revealed-preference activity rule.

### Claim 6 (depends on 1)

The system of claim 1 wherein the means for receiving at least one further bid includes means to constrain bids by a relaxed revealed-preference activity rule.

### Claim 7 (depends on 3)

The system of claim 3 which further includes means for applying an activity rule that limits current bids based on prior bids.

### Claim 8 (depends on 3)

The system of claim 3 wherein the means for receiving at least one further bid includes means to constrain bids by a revealed-preference activity rule.

### Claim 9 (depends on 3)

The system of claim 3 wherein the means for receiving at least one further bid includes means to constrain bids by a relaxed revealed-preference activity rule.

### Claim 10 (depends on 1)

The system of claim 1 which further includes means for receiving intra-round bids.

### Claim 11 (depends on 10)

The system of claim 10 which further includes means for applying an activity rule that limits current bids based on prior bids.

### Claim 12 (depends on 11)

The system of claim 11 which further includes means for updating prices based on the history of received bids and the available quantities.

### Claim 13 (depends on 12)

The system of claim 12 wherein the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 14 (depends on 1)

The system of claim 1 wherein the plurality of items are telecommunications licenses or spectrum rights.

### Claim 15 (depends on 1)

The system of claim 1 wherein the plurality of items are electric power or other commodity items.

### Claim 16

A method implemented in a system comprising a first computer and a communication interface, said communication interface enabling communication between the first computer and one or more remote computers, said method for determining an allocation of a plurality of items to a plurality of bidders in an auction wherein bids are received and an allocation of the items to the bidders is determined at the first computer, said method comprising:
a) conveying prices for the items;
b) receiving at the first computer at least one bid from at least one bidder, said bid comprising an indicator of quantity for at least one of the items at the conveyed price;
c) conveying updated prices for the items;
d) receiving at the first computer, using the communication interface, at least one further bid from at least one bidder, said bid comprising an indicator of quantity for at least one of the items at the conveyed updated price; and
e) determining an allocation of the items at the first computer based on selecting a combination of received bids that optimizes revenues subject to a constraint that the selected combination of received bids is feasible.

### Claim 17 (depends on 16)

The method of claim 16 which further includes updating prices based on the history of received bids and the available quantities.

### Claim 18 (depends on 17)

The method of claim 17 wherein the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 19 (depends on 16)

The method of claim 16 which further includes applying an activity rule that limits current bids based on prior bids.

### Claim 20 (depends on 16)

The method of claim 16 wherein the receiving at least one further bid includes constraining bids by a revealed-preference activity rule.

### Claim 21 (depends on 16)

The method of claim 16 wherein the receiving at least one further bid includes constraining bids by a relaxed revealed-preference activity rule.

### Claim 22 (depends on 18)

The method of claim 18 which further includes applying an activity rule that limits current bids based on prior bids.

### Claim 23 (depends on 18)

The method of claim 18 wherein the receiving at least one further bid includes constraining bids by a revealed-preference activity rule.

### Claim 24 (depends on 18)

The method of claim 18 wherein the receiving at least one further bid includes constraining bids by a relaxed revealed-preference activity rule.

### Claim 25 (depends on 16)

The method of claim 16 which further includes receiving intra-round bids.

### Claim 26 (depends on 25)

The method of claim 25 which further includes applying an activity rule that limits current bids based on prior bids.

### Claim 27 (depends on 26)

The method of claim 26 which further includes updating prices based on the history of received bids and the available quantities.

### Claim 28 (depends on 27)

The method of claim 27 wherein the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 29 (depends on 16)

The method of claim 16 wherein the plurality of items are telecommunications licenses or spectrum rights.

### Claim 30 (depends on 16)

The method of claim 16 wherein the plurality of items are electric power or other commodity items.

### Claim 31

A computer readable medium storing a plurality of instructions which, when executed in a system comprising a first computer and a communication interface, said communication interface enabling communication between the first computer and one or more remote computers, implements a method for determining an allocation of a plurality of items to a plurality of bidders in an auction wherein bids are received and an allocation of the items to the bidders is determined at the first computer, said method comprising:
a) conveying prices for the items;
b) receiving at the first computer at least one bid from at least one bidder, said bid comprising an indicator of quantity for at least one of the items at the conveyed price;
c) conveying updated prices for the items;
d) receiving at the first computer, using the communication interface, at least one further bid from at least one bidder, said bid comprising an indicator of quantity for at least one of the items at the conveyed updated price; and
e) determining an allocation of the items at the first computer based on selecting a combination of received bids that optimizes revenues subject to a constraint that the selected combination of received bids is feasible.

### Claim 32 (depends on 31)

The medium of claim 31 wherein said method further includes updating prices based on the history of received bids and the available quantities.

### Claim 33 (depends on 32)

The medium of claim 32 wherein, in said method, the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 34 (depends on 31)

The medium of claim 31 wherein said method further includes applying an activity rule that limits current bids based on prior bids.

### Claim 35 (depends on 31)

The medium of claim 31 wherein, in said method, the receiving at least one further bid includes constraining bids by a revealed-preference activity rule.

### Claim 36 (depends on 31)

The medium of claim 31 wherein, in said method, the receiving at least one further bid includes constraining bids by a relaxed revealed-preference activity rule.

### Claim 37 (depends on 33)

The medium of claim 33 wherein said method further includes applying an activity rule that limits current bids based on prior bids.

### Claim 38 (depends on 33)

The medium of claim 33 wherein, in said method, the receiving at least one further bid includes constraining bids by a revealed-preference activity rule.

### Claim 39 (depends on 33)

The medium of claim 33 wherein, in said method, the receiving at least one further bid includes constraining bids by a relaxed revealed-preference activity rule.

### Claim 40 (depends on 31)

The medium of claim 31 wherein said method further includes receiving intra-round bids.

### Claim 41 (depends on 40)

The medium of claim 40 wherein said method further includes applying an activity rule that limits current bids based on prior bids.

### Claim 42 (depends on 41)

The medium of claim 41 wherein said method further includes updating prices based on the history of received bids and the available quantities.

### Claim 43 (depends on 42)

The medium of claim 42 wherein, in said method, the updating of prices is based on the extent to which the quantities bid, summed over all bidders, exceed the quantities available in the auction.

### Claim 44 (depends on 31)

The medium of claim 31 wherein, in said method, the plurality of items are telecommunications licenses or spectrum rights.

### Claim 45 (depends on 31)

The medium of claim 31 wherein, in said method, the plurality of items are electric power or other commodity items.