One other thing to keep in mind in this debate is that it's expensive to defend yourself from a patent lawsuit. For example, this blog (http://rpxcorp.com/blog/?p=129), whose accuracy I have no idea of, claims that the average total cost of a patent lawsuit where the potential damages are under $25MM is $3.1MM to defend yourself, and $6.2MM if the potential damages are over that number.
So there are several parts to this equation. 1) Creating any bit of software involves thousands of "inventions," any one of which could be patentable. 2) Patents are granted for things which fail the obviousness test, where the chance of someone else independently "inventing" the same thing is essentially 100%. 3) The damages for violating even one patent tend to be astronomical and totally out of line with the contribution of that "invention" to the software in question. Out of 2 million lines of code, if one total BS patent covers 20 lines of that code, why are the damages likely to be basically equivalent to most of the revenue for that product? 4) The cost of defending against a patent lawsuit is enormous.
In other words: if you're a small software business, then there's pretty much a 100% chance someone else can sue you for patent infringement if they want to, losing the case will kill your company, and trying to defend yourself will severely drain your resources and could kill your company anyway.
There's no part of that that helps or encourages innovation.
I've had two runins with the patent system, and both have severely weakened my trust in it.
Back in the day a student at my dorm in college decided tit would be a cool idea to make a webserver for our laundry machines so that we could tell if there was one free without going down to the basement. It attracted some interest, and was even Slashdotted a couple of times over the years. Between Slashdottings one and two a company applied for a patent on the idea of connecting laundry machines to web servers. Much later, after our dorms laundry server had been in operation for about a decade, they sent us a cease and desist letter. We informed them that they'd lose their patent if they took us to court and didn't suffer, but they are still charging people millions of dollars for the system their invalid patent gives them a monopoly on.
After I got my Master's I started work at a consultancy that did custom sensors. They had previously outsourced their engineering, but the company that had been given the engineering work had tried to patent the ideas of the consultancy out from under them. Luckily the consultancy had filed for patents first, but the company was granted one of the patents anyways.
Who can say but starting a fight with any entity is dicey proposition. They might have no cash or be adept of leaving in the dead of night. They might turn out to have more lawyers than you and your costs would be huge.
Rather than abolish software patents, I'd like to see better precedents be set. A software patent should be held to the same fundamental tests (non-obvious, novel, unique) but the bar should be much higher for software because the domain is so fast changing. Many software patents seem very obviously superseded by prior art to anyone in the domain.
I would also love a fourth fundamental test to be added - cost of development. The fundamental purpose of patents is to encourage innovation by allowing investments in developing new technology to be recouped. Devising and implementing a one click shopping system is not a substantial investment.
Unfortunately measuring the "cost" of development gets very complicated and subjective very quickly - accounting for money spent on failed attempts, human capital invested, opportunity cost, etc. Amazon could claim their whole development team was trying to think of innovations and one click shopping was the culmination of all of their efforts.
This. If licensing your patent costs more than having each participant in the industry independently recreate the invention, your patent served only as a tax on the industry rather than a contribution.
Ack. Just the size and variety of industries whose operations are defined by patent law (medical research, for example - both drugs and equipment) makes this kind of proposition a lot more complicated than we can comprehend, I think.
I agree, but what's the chance that we'll ever get a non-broken implementation? If someone really tries to fix it, that would be great, but what are the odds it'll really be fixed instead of just being broken in different ways? From my perspective, ExpectedChanceOfBrokenness * ExpectedCostOfBrokenness > ExpectedCostOfKillingThem . . . so the probabilistically optimal course is to just kill patents for software (and business methods), even if it's not the absolutely optimal course.
It is if you can first solve the problem of getting people with domain knowledge to work as patent clerks, or if there is a "peer review" process or something.
The alternative to patents is not "all information wants to be free", it's paranoid secrecy. If people are to invest in R&D, they need protection from copycats. I mean, check this out: http://www.nytimes.com/2010/08/07/business/07muffin.html
The alternative to patents is not "all information wants to be free", it's paranoid secrecy. If people are to invest in R&D, they need protection from copycats. I mean, check this out: http://www.nytimes.com/2010/08/07/business/07muffin.html
The other alternative is that people get along with openness just fine. Beside, people don't have an inherent right to a technological secret, at least in the normal cases.
You are making the same economic mistake that a lot of anti-IP types do, which is that you assume that the cost of duplicating a thing has any relation to the cost of producing it in the first place. It does if you're talking about, I dunno, spoons.
The point of patents is, if you discover a method of doing something, you patent it, and if anyone wants to use your process, they pay you to license it. So we provide a mechanism - but not the guarantee, since no-one might be interested - for a return on an investment into R&D.
Do you really, honestly believe that a drug company would research a new drug, spend a decade shepherding it through clinical trials and FDA approval (we are talking an investment of hundreds of millions of dollars) and then a generic manufacturer sells it for a little over the price of the raw materials, having gotten all the hard work done for them for free?
Because even if they wanted to they couldn't; they'd be bankrupt.
> The point of patents is, if you discover a method of doing something, you patent it, and if anyone wants to use your process, they pay you to license it. So we provide a mechanism - but not the guarantee, since no-one might be interested - for a return on an investment into R&D.
That is not the point of the patent system, that is the means by which the actual goal is obtained. The goal of the patent system is make the information public so all of mankind can benefit from it and the knowledge doesn't die with the inventor. Buying off the inventor with a limited monopoly on the idea is merely a means to an end.
The goal of the patent system is make the information public so all of mankind can benefit from it and the knowledge doesn't die with the inventor
If you have a mechanism other than patents that makes it economically possible for private organizations to engage in capital-intensive R&D and make the information public, let's hear it.
Where exactly did I imply that? I was merely pointing out the motivations of the patent system. The system is not necessary for companies to be economically viable as they've been doing that with trade secrets long before patents were around. The patent system was meant to unlock those trade secrets for the benefit of the public, it was never about the inventor's best interests.
You are making the same economic mistake that a lot of anti-IP types do, which is that you assume that the cost of duplicating a thing has any relation to the cost of producing it in the first place. It does if you're talking about, I dunno, spoons.
I have made no such claim. In any case, producing in the first place will cost an order of magnitude more than copying. However, this seem to be of little hindrance in the observations that I been able to make over the years.
Paranoid secrecy probably costs more to maintain than the benefit they receive from it. Their secret isn't much of a competitive advantage. Their brand is. Keep trademark, kill patents.
> "Some bakery experts were skeptical about Bimbo’s claims of top-secret processes, saying the mythology surrounding Thomas’ muffins was more about smart product branding than proprietary baking. The basic techniques for making an English muffin were widely known, they said: English muffin dough is very watery and when it is cooked at high heat the water evaporates quickly and leaves large air pockets."
I think it might be more accurate to say the legal system is broken, because that's what makes patents so dangerous. You can't afford to participate in the legal system unless you have lots of money, and patents are just one way incumbent companies can force their competitors into litigation.
This is true about many ideals. See socialist, laissez-faire capitalist, and communist supporters for arguing points.
Hell, see any utopian idealistic system. The excuse is the implementation always fails. How many times does implementation have to fail before we start to question whether it is simply possible to implement it correctly and whether it's worth the cost and frustration in the first place?
The world of SW is largely already a world w/o software patents. Very few companies are effected by SW patents. And even startup companies generally spend very little money on patents.
And in my experience, I've never met anyone at a startup company who didn't implement a technology due to a patent. But I have certainly worked with large companies, MS, IBM, HP, who have not implemented a technology due to patents.
It seems like a world w/o patents would simply strengthen MS and IBM. And probably have no net effect on startups, except in the unlikely event they do something innovative, but is somewhat easily replicated once seen.
Software patents affect small companies when they get sued by big companies or patent trolls. It happens all the time, and when it does there's basically no defense unless you have a huge patent portfolio and can countersue . . . which, if you're a small company or the other side is a patent troll, you can't do.
Maybe it happens, but I've never seen it happen in my career. I'm sure it does, but its pretty rare. And I've never seen any startup make a technology decision based on existing patents.
I have been involved in patent litigation for many large companies, in a defensive role. And while some do blatantly violate patents, they generally go out of their way to work around the patent.
And there are some oft-requested features that don't exist in very popular products that don't exist solely due to patents.
And even patent trolls attack large companies more.
I just don't think that if you're a startup company you have much rational reason to care about patents. And if you do fear them, I suspect you'll likely fail due to that fact I doubt you're very rational.
For what it's worth, it's happened to my company (a smaller company sued by a larger competitor), and the litigation has dragged on for almost three years now without going to trial.
I've heard of other similar incidents as well. They're far more likely if you're going into an existing market against well-funded (and shameless) incumbents than it is if you're in a nice market.
You're correct that the rational response is to not worry about it, simply because there's nothing you can do about it as a software startup. If someone wants to sue you, they will, no matter how far you go out of your way to avoid violating patents. So you just kind of hope you don't get unlucky and get sued before the company becomes big enough to file their own patents for defensive purposes.
Just because something happens infrequently doesn't mean it's not a real problem.
What was your company? I'd love to know this history. I've just never seen it happen that a large company files suit against a small startup. The closest thing is something like MS vs SalesForce, but SalesForce is hardly a small company.
Again, I'm not saying it doesn't happen at all. But so do random bits flipping due to cosmic rays, but I don't think we should change how we write code due to it. Something are sufficiently rare that they're not worth spending much time on.
I don't think we should change how we write code, either: I think we should change the patent system so this stuff doesn't happen. I get tired of hearing the "it's just big companies suing other big companies" argument about why patents aren't a problem. Software patents generally don't stifle innovation because people don't do something because they're worried about patents: they stifle innovation by diverting huge financial and mental resources to patent lawsuits (and patent filing) that could otherwise go to product development or something else useful, and occasionally by crippling companies that aren't large enough to defend themselves. It's just kind of tax on the industry as a whole where the net effect is to siphon money and energy away from important things and towards lawyers. You'd have approximately the same effect if you replaced the patent system with roving bands of feral lawyers that went around randomly destroying property and burning down offices. You wouldn't say, "Hmm, I don't think I'll write software because some lawyer might burn my house down," but dealing with all that destruction would drain resources from other areas, and sometimes it would be too much for a company to overcome.
I can't really get into any specifics of the litigation because it's still ongoing.
May be because big companies have the deep pocket so they are the target of patent lawsuit? For small companies, software patent has the chilling effect in prevent them in doing certain things.
If you're going make a decision based on existing patents, the only possible decision is "don't go into the software business." Hard to say how often it happens.
Except that it rarely, if ever, happens. It's a waste of money to sue companies who aren't a threat or can't pay you. Look at who gets sued: Google, Apple, HTC, Microsoft. Look at who doesn't: Y Combinator and TechStars companies.
Just wait a few years. As you say, it's a waste of money to sue someone who's not a threat. Once one of those companies becomes a threat to someone with deep pockets (and some of them will), there's a fairly high likelihood that someone will sue them.
>It seems like a world w/o patents would simply strengthen MS and IBM.
How so? One company off the top of my head is TomTom that would benefit to Microsoft's detriment (VFat patent litigation; TomTom lost, MS won.)
IBM's hegemony is largely predicated on its mainframe-related patents. If anyone could write a clone they'd have their lunch eaten by FOSS same as Sun and the other big Unix vendors.
This is actually more accurate than you'd think. While everyone used IBM PCs as their personal computers for many years, IBM was harmed massively when their PC BIOS was reverse engineered and then copied by Compaq (and subsequently many other computer manufacturers.) In fact, arguably, because that happened, we had a cheap IBM PC boom where software would work on multiple hardware platforms made by multiple different companies. This led to Microsoft's rise. Arguably, if they only sold on IBM-sold PCs, they would have made a lot of money, but nothing as meteoric as they did.
Yes, not having a patent on something actually created the behemoth which is Microsoft.
Here's an anecdote. I am affected by software patent. One of the well known optimization techniques in the product area that I'm working on has been patented and bought by a big corporation. The situation is kind of murky since there are similar techniques published by academics. That big corporation has sued anyway and won large settlement from other companies.
For my product, I have to forgo implementing the technique. It defines a feature not the product but it's a competitive advantage.
The fact that companies have created software, patented it, and sued large companies that use their technology gives me pause. Without software patents the software industry will become like the consumer products industry where inventors are ripped off by large corporations.
I think the VC's who are pushing this have an agenda.
If this was what was happening in the majority of cases, I would agree. But it isn't - big companies frequently buy patents just to go after and shut-down/settle with smaller companies who are posing a threat. Like Apple against HTC. Like Microsoft against Salesforce.com.
If there was a shorter life span, or stronger enforcement over patent squatting, fewer people would be standing against it. But saying the VCs pushing this have an agenda, without citing a single source, and thinking that patents do anything now other than pay lawyers and slow innovation, is narrow-minded.
Let me be clear. You think Microsoft has sued more companies than smaller companies have sued Microsoft? Wow, that's some serious revisionist history. Just in the past two years MS has been sued by at least seven companies -- and I don't recall any of them being trolls.
MS doesn't need to sue, they just do intimidation and forces small companies to pay them licenses, taxing all their competitors. I'll let you google the glory details. Also, when MS sue a company for a patent on the FAT file system, that's because they refused to pay them royalties/licenses unlike the 100 more companies they secretly threatened before them.
Software is easily copied and manipulated enough that small businesses which are flexible and innovative will remain competitive against larger businesses which may steal some of their ideas.
The only real concern to me is that smaller businesses don't have the sales and marketing team as the larger companies.
Right now, large businesses can flatten smaller businesses (See MS vFAT decision) if they even remotely become competitive through patent lawsuits. It is very rare to happen in the reverse.
I'm on board for abolishing software patents, but it would help if the author understood what the (ostensible) purpose of the patent system was:
This effectively undermines the entire purpose of the patent system: the patent office is charging applicants serious money for giving it the privilege of giving away their commercial secrets.
Giving away commercial secrets is why the patent system exists! The fact that software patents usually are too obscure to give away their secrets is part of what makes software patenting so dysfunctional in the first place.
I have never really understood (or perhaps know where I stand) on the issue of software patents, this article did not help.
"What is most alarming is that patent office automatically publishes applications online after the 18 months ... This effectively undermines the entire purpose of the patent system: the patent office is charging the applicant serious money for giving it the privilege of giving away their commercial secrets."
You know that going in (that you might not get a patent but that it will be published), it's a risk, but the whole idea is that great ideas will be released into the public domain with enough information to be implemented.
"They had the concept right, but they surely never conceived of Amazon.com patenting clicks in an online shopping cart and methods for having an online discussion"
This is an issue but in my opinion an issue with the patent office granting patents which through granting do not further innovation in the slightest (rather than it being software). A counter to this example would be perhaps, MapReduce [1].
I think that after a short amount of time (perhaps 10 years after being registered) all patents should be released.
This period would allow the innovator time to bring their product to market and begin profiting from their ideas. It would prevent patents being seen as a way to unfairly limit competition. Innovation would be encouraged. It might also reduce the desirability of patent-trading.
That's the best compromise I could come up with. I'm not interested in hearing from people who have a 100% ideological position. I'm interested in finding a solution, which implies a compromise from both sides. "Patents are evil" is not a solution.
I don't get why there are so many down-mods to perfectly civil comments, as evidenced by their zero-karma scores. I just upvoted all of them, for which I will no doubt be downvoted by the same worthy who down-voted the others.
There are lots of perfectly civil comments that add nothing to whatever discussion they are part of: stupid jokes, restating the obvious, complaining about downvoting, and so on. People often downvote such comments in order that others will be able to more easily find the comments worth reading.
None of the comments I upvoted were in any of those categories -- at least not IMHO, and therein lies the problem, it usually comes down to a matter of opinion.
As long as PG doesn't separately state upvotes and downvotes, a better answer might be to reply to comments you don't love with "RTO" (restates the obvious) or "ANTD" (adds nothing to discussion).
i am for abolishing the patent system - it is archaic - the reason no one can duplicate googles success is not the patents they hold but the infrastructure they built -furthermore- competition actually helps to -increase- the market - in new yorks fifth avenue there are hundreds of luxury brands - doing business next to each other - and thriving - if your competition copied you - you copy their improvements to improve your product - copyright is an impediment that serves no body ----except the government bureaucracy---- who enforces the copyright --laws--
I think having shorter times for copyright and patent to expire would be effective. With the speed and turnaround of the current markets, patent law ends up stifling innovation and in general harming the economy as a whole.
This is a prime reason countries which are lax in enforcing copyright law as rising economically in the world.
So there are several parts to this equation. 1) Creating any bit of software involves thousands of "inventions," any one of which could be patentable. 2) Patents are granted for things which fail the obviousness test, where the chance of someone else independently "inventing" the same thing is essentially 100%. 3) The damages for violating even one patent tend to be astronomical and totally out of line with the contribution of that "invention" to the software in question. Out of 2 million lines of code, if one total BS patent covers 20 lines of that code, why are the damages likely to be basically equivalent to most of the revenue for that product? 4) The cost of defending against a patent lawsuit is enormous.
In other words: if you're a small software business, then there's pretty much a 100% chance someone else can sue you for patent infringement if they want to, losing the case will kill your company, and trying to defend yourself will severely drain your resources and could kill your company anyway.
There's no part of that that helps or encourages innovation.