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05.08.13

Losing Sight of the Real Problem With the Patent System

Posted in Deception, Patents at 12:51 pm by Dr. Roy Schestowitz

Man with glasses

Summary: Criticism of a strategy for reforming the patent system — a strategy which gained popularity despite the fact that it is a red herring with no solution in sight

Armed with some new information, Mike Masnick insists that “Over 90% Of The Most Innovative Products From The Past Few Decades Were NOT Patented“. Copyright is not a prerequisite for creativity and patents are not essential for innovation; these legal instruments are empirically shown, repeatedly, for having the very opposite effect. So the problem is patents and copyrights, not those who use or misuse them. These two are quite outdated and ‘modernising’ them for the age of digital abundance is imperative; making software patentable like hardware is worse than foolish and trying to restrict copies of 1s and 0s is also an impossible task.

Brad Feld, a startups-loving VC, says “It’s Time To Protect Startup Communities From Patent Trolls” (which again places focus on trolls rather than software parents, as Feld used ti). To quote his opening paragraphs:

If you’re a mobile gaming startup, you’ve probably heard of, or even been sued by, a company called Lodsys. Where this narrative gets interesting is when you understand that Lodsys is suing small, effective companies for “unlawfully” using patents that that it has no intention of developing upon. This behavior is what the tech community calls patent trolling. And there are AT LEAST hundreds of so-called “patent trolls” out there — increasingly targeting startups, creating a real drag on innovation and job creation. 55 percent of the companies targeted have $10 million or less in annual revenue.

I spend my days investing in new tech companies around the United States, hoping to help them build the next great idea that will make our lives better. Startups already face many unique challenges to growth and so I’m always disheartened to see legislation that fails to protect, or even hurts, companies that are creating jobs and inventing breakthrough technologies. One recent example is the America Invents Act (or AIA) — the biggest attempt at patent reform in over 50 years. Despite the attempt at change, the system is still struggling under the weight of overly broad patents that are often bought up by non-practicing entities (or patent trolls).

But that’s not the key point; trolls are not always worse than large entities which use software parents to impede startups. Masnick’s site says that “When Startups Need More Lawyers Than Employees, The Patent System Isn’t Working” (irrespective of patent trolls). This too, however, uses the recurring theme of trolls rather than software patents:

As part of our sponsorship program with the Application Developers Alliance, we’re highlighting some of the content on DevsBuild.It, their new resource website, that we think will be most interesting to Techdirt readers.

We’ve talked a lot about the tax on innovation that patent trolls create, which is well-known inside startup circles but often misunderstood by the broader public, thanks to the pro-innovation rhetoric of high-profile trolls like Intellectual Ventures. The conversation is getting more attention lately, especially with the recent news of Senator Schumer’s patent reform bill which specifically aims to fight the patent troll problem, and this interview with an anonymous developer from a tech startup offers some perspective from someone who is directly affected by the issue.

Ashby Jones from the Murdoch-owned press misses the boat by using a false narrative in the article “Samsung-Apple Patent Fight: Is It Worth It? “

There are issues with this article. It starts with: “Smartphone makers who went on the offensive in the industry’s patent wars are learning a tough lesson: The courts aren’t buying it.”

Not quite accurate. It was Apple that sued Samsung, it’s not a two-way battle. When one side seeks deterrence/defence through reactive litigation, it’s not quite as the article puts it. Here is a post based on this report:

WSJ: The patent wars have been a major bust for all smartphone vendors

While just about everyone is sick and tired of the constant barrage of patent lawsuits among smartphone vendors, it seems that tech companies themselves keep plugging precious resources into suing one another despite having fairly little to show for it. Analysis by The Wall Street Journal has found that “courts have proven as likely to deliver plaintiffs a rebuke as a win, and the slow grinding of the justice system has sapped the impact of the occasional big victories” in patent lawsuits.

There is a pattern in reporting which is troubling; either the reporters single out the mobile market as the issue or they simply name the trolls, never challenging the simple idea that patents themselves (or their scope) may be the culprit.

Apple is suing Android/Linux because Apple is desperate, not because its patents have merit. Already we see some eulogies for Apple, such as this one about “Peak Apple”. It says:

Foxconn is reportedly planning for an Apple-free future after a massive slump in orders from Cupertino.

Apple’s favourite production company is moving away from simply building other people’s designs and trying to break into a new market with the introduction of a range of flatscreen televisions.

Recall that Foxconn sold Android down the river to Microsoft [1, 2]. This is neither an issue of patent trolls nor an issue of patent applications backlog. Taking a shot at trolls would do nothing to address the issue, not in its entirety anyway.

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