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08.06.10

Intellectual Ventures Revisited as Facebook is Hoarding Patents; Apple Patents Other People’s Ideas/Implementations

Posted in Apple, Microsoft, Patents at 9:01 am by Dr. Roy Schestowitz

“We’ve always been shameless about stealing great ideas.”

Steve Jobs, Apple

Happing hogs

Summary: Facebook is hogging again and Apple shows that it’s not only a patent threat but also a cheeky hoarder of other people’s ideas

IN A POST that we wrote earlier on about Facebook (a Microsoft partner) we mentioned Microsoft's patent troll (Nathan Myrhvold) because Facebook’s founder (Zuckerberg) was meeting with this troll, according to reports. It is possible that Zuckerberg was looking to buy some software patents, which he eventually got off of Friendster for more than Friendster is even worth, according to TechDirt:

Facebook Picked Up Friendster’s Patents For More Than It Cost To Buy Friendster

[...]

What’s impressive here is that the entire company Friendster had been sold just a few months earlier for… $39.5 million. So the buyer has effectively recouped the purchase price in less than a year. Impressive. As for why Facebook just wasted so much money (even if not all of it is “real”) on a bunch of patents? As Liz Gannes postulates, it’s probably just to keep the patents from getting in the way of an upcoming IPO. For a company currently valued at such insane levels, $40 million to clear an obstacle to an IPO is nothing major — especially when a portion of the deal is via in-kind services. Hopefully Facebook knows better than to start using the patents offensively, but somehow, I get the feeling this is not the last we’ll hear about these patents.

It probably remains to be seen how these patents will be used (maybe just as a deterrent) and we have reasons to be concerned [1, 2]. Did Facebook ever buy patents from Nathan Myrhvold’s racketeering firm (Intellectual Ventures)? According to another new post from TechDirt, Intellectual Ventures continues to sell patents, even to large companies like Verizon (which is now working with Google to destroy net neutrality, for shame!).

Intellectual Ventures is the infamous company founded by former Microsoft CTO Nathan Myrhvold to hoard patents on a massive scale and to basically get companies to pay up “protection money” to (1) keep those patents from being used against them and (2) let them use those patents against others. While for years Myrhvold insisted that Intellectual Ventures was avoiding lawsuits, we have seen IV patents showing up in lawsuits lately. The first one was last year, involving a patent IV had sold, but it wasn’t clear if it still had an interest in any awards or settlements received. It has become clear that the company has set up over 1,000 shell companies, however, so that makes it more difficult to know sometimes.

However, there have been two cases of IV patents officially involved in lawsuits lately, and both are on the “defensive” side. The first was back in March, where IV sold some patents to Verizon that it could use in its fight against TiVo. TiVo had sued Verizon, but since Verizon had paid IV some huge amount of money (hundreds of millions of dollars), it had the right to pick from IV’s patent portfolio to sue back. That same thing appears to be happening again, though, this time with a smaller company who wasn’t already an IV member. Speech to text company Vlingo was sued by speech recognition software giant Nuance for patent infringement, and now Vlingo has paid Intellectual Ventures to “join” and to get patents back, which it can use to fight back against Nuance.

Remember who’s behind Intellectual Ventures in terms of funding. It’s Microsoft, Bill Gates, and Apple. And in other news about Apple, its latest outrageous software patents are being discussed in Slashdot, which points to several sources. Jan Wildeboer says: “[A]pple patents “inspired” by existing 3rd party work? Or plain stealing? You decide.” Here is the referenced article which says:

The patent has been filed in December 2009. And clearly, the number of details with all the icons, their ordering and the actual app name “Where To?” in the title bar (which, as a sidenote, doesn’t make a lot of sense as a module in a potential iTravel app) can’t be randomly invented the same way by someone else.

[...]

In summary, this episode once more reinforces my personal aversion against software patents. In my opinion they discriminate against smaller developers who can’t afford building a huge legal department to defend against such patent cases and to research existing patent mine fields.

Wildeboer added: “Is Apple trying to patent apps to create an innovation tax on android apps?”

Consider more information on the same subject:

Not a Joke: An Apple App Patent (Pic) That Looks Like an Actual App Selling on the App Store

[...]

Dan Wineman explains that ”the diagram is just part of an example of one way the technology in question might operate. I think it’s more likely that the people involved in drawing up this patent simply didn’t think about the message it would send to developers. I’m sure it’s not Apple’s practice (or intention) to plunder the App Store submissions bin for new things to patent.”

Reader Gary Watson says: “After reading the claims, it’s clear that the spinning wheel image stolen from the 3rd party app was not part of the claimed invention at all and was just an illustration. You see this a lot in patents, where a an exemplar device such as a Dell laptop is used in a drawing but is not part of the claims.”

Earlier this week we wrote about a TechCrunch report which gave Apple’s hypePhone as an example of a product with over 1,000 patents on it (and Apple uses hypePhone patents offensively against Linux). This report led TechDirt to asking “How Much Of The World Is A Patent Free Zone”. From the opening:

Vivek Wadhwa has an interesting post at TechCrunch, pointing out that much of the world beyond the US, Europe and BRIC (Brazil, Russia, India, China) are effectively a patent free zone. Even if many of these places do have patent laws, very few companies find it worth the trouble to file for patents in those places — and, technically, that means that anyone producing products in those areas can legally copy from the patents filed elsewhere.

Had there been no patents in this area (especially mobile phones), products would improve, according to analyses*. But big companies like Apple would then not be as wealthy. That’s just who patents typically serve — the already-wealthy. Patents are an expensive protectionist tool, not a progressive tool, contrary to myths. Here is a video of a phone which runs Linux but Microsoft is taxing using software patents that it refuses to disclose (it’s a Samsung Galaxy S).


____
* Many phones are deliberately limiting function due to patents.

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