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11.29.06

Microsoft Looking for Patent Reform?

Posted in Action, Courtroom, Intellectual Monopoly, Law, Microsoft, Patents at 11:40 am by Shane Coyle

In a case which is in no way directly related to software, actually it is about automobile gas pedals, Microsoft and other tech giants are weighing in in a patent dispute case that is likely to set a tremendous precedent.

On one hand, technology companies are sick of getting sued, often by patent squatters that don’t really make much of anything but go around patenting the schemas for products that other companies are (often independently) working on and then clean up in patent lawsuits. Tech companies would like to see some sort of flexibility built into the patent system so that it’s not so easy to patent just anything and then sue later on when somebody who’s actually creating something happens to come up with that same thing or something similar to it. Sounds pretty straightforward, right? Well, on the other — also very powerful — hand, drug and chemical companies want to protect their products from generic competition and counterfeiters, and patents offer the strongest form of protection. So there’s a battle shaping up here that could profoundly affect some of the world’s most powerful corporations. In other words, it’s worth paying attention to this.

It should be noted that all throughout the Novell-Microsoft deal, both companies have repeatedly asserted that no in-depth review of patent portfolios took place, because each knows that there are “legitimate questions about patent quality” that would need to be addressed. Instead, each company opted to purchase a pig in a poke, so to speak, knowing it is easier to negotiate a preemptive peace rather than risk war and learn you haven’t any munitions.

There, of course, is a small problem with this industry methodology: small, upstart companies have an impossible barrier to entry. As the tech giants continue to obtain and leverage dubious software patents, using cross-licensing deals to create a cartel that will ensure that these same companies continue to live on and derive revenue long after they have ceased to innovate.

David Kaefer of Microsoft indicated himself that the prospects of conducting a patent review for any given piece of software is “prohibitive”, requiring you to review “thousands of patents”. If Microsoft hasn’t the legal resources to conduct such a review, how could a startup company in their garage be expected to?

Asked whether Microsoft would consider revealing what parts of Linux allegedly violated the company’s intellectual property so that open-source developers could throw out the offending code, Kaefer demurred, saying it would not be “very productive.”
“Patents are hard to understand. You have to have a certain level of expertise to understand the scope. And there are legitimate questions about patent quality,” he said. “The reality is that you’d have to look at thousands of patents and thousands of products. To focus on every single one would be prohibitive.”

In an article entitled Microsoft and Novell: Bambi Meets Godzilla?, Joyce Becknell observed:

It is a sad statement on the state of the industry that more and more companies are making money from patents and intellectual property not by making products with them but by threatening other vendors who may be infringing those patents.

Perhaps, after losing yet another Patent infringement case themselves, threatening the distribution of their cash-cow Office in Korea, Microsoft is starting to see the state of the industry as well.

Perhaps.

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A Single Comment

  1. boxopen said,

    November 29, 2006 at 11:59 am

    Gravatar

    Let me tell something in a “short” way…

    IP was/is the trick to inflate the accounting
    and to delay “inside” know (and semi-public) problems.

    That’s why the software patents are accepted in the US
    (where the public numbers are already “well know” worldwide)
    and they are not accepted in Europe where the “numbers” are more trusted.
    (because 25-pairs of “eyes” invalidates the kind of corporate America dirt tricks)

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