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Rethinking the Impact of Patents on Innovation

Innovation



Summary: How patents -- and software patents in particular -- continue to weigh down companies that innovate

Several years ago we wrote about Finjan [1, 2, 3, 4, 5, 6, 7], noting the Microsoft connection and the effect on software patents policy in Europe. It is now being reported that Finjan is on the offence again. "Complaint alleges infringement of Finjan patents relating to endpoint, Web, and network security technologies," says the summary. This is of course about software patents and it harms producing companies. Finjan has been a fine example of how patents on software in particular are hurting innovation, not promoting innovation. It may be the case that in some other areas it is different, but experience suggests that where software patents go so do patent trolls.



"It may be the case that in some other areas it is different, but experience suggests that where software patents go so do patent trolls."According to this new post from TechDirt, "[o]ne of the most frustrating things for us has been how many reports use patents as a proxy for innovation, even as many studies have shown no correlation between patents and actual innovation."

Contrariwise, an economist "looks at the growth rate in Total Factor Productivity -- which is a measure of output that comes from "non-traditional" inputs -- i.e., output created directly from land or capital. This is a reasonable way of measuring the impact of technological improvement."

Based on other interpretations of this, we should start looking at such measures as the real factor affecting innovation and patents, therefore, as a potential impediment to innovation. Technical people innovate naturally, usually with opportunities in mind, not with patents in mind.

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