Microsoft's Changing Views On Patents; When You're Young You Need To Innovate; When You're Old You Need To Litigate

from the protectionism-at-work dept

Fri, Mar 9th 2007 6:25pm — Mike Masnick

Thursday morning, I noticed an odd opinion piece at News.com by Brad Smith, Microsoft's general counsel, celebrating patent law, despite the fact that the company had just been dealt a $1.5 billion setback in a patent dispute. I'd been noodling over what to write about it, because the most amusing thing was that he completely ignored the fact that Microsoft had only picked up the patent obsession recently -- and in its earlier years had been against patents. If anything, it reminded me that we keep seeing stories of young innovative companies who don't use patents, but who only become patent system fans when they have large established markets they want to protect from innovative competitors. In other words, when they're young, they compete by innovating. As they mature, they block the competition using protectionist patents -- which is exactly the opposite of the type of actions the patent system is supposed to encourage.

Either way, Tim Lee has done an excellent job highlighting Bill Gate's very prescient prediction on software patents juxtaposed with Brad Smith's claims on the importance of the patent system:

Brad Smith, Microsoft general counsel, 2007: "Protection for software patents and other intellectual property is essential to maintaining the incentives that encourage and underwrite technological breakthroughs. In every industry, patents provide the legal foundation for innovation. The ensuing legal disputes may be messy, but protection is no less necessary, even so."

Bill Gates, Microsoft CEO, 1991: "If people had understood how patents would be granted when most of today's ideas were invented and had taken out patents, the industry would be at a complete standstill today... A future start-up with no patents of its own will be forced to pay whatever price the giants choose to impose."

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15 Comments

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thinlizzy151, 9 Mar 2007 @ 9:10pm

How very Microsoft...
Just what you would expect from the world's most evil tech company. Hypocrisy pays, does it not? There are no moral givens, no truths about right and wrong - it all comes down to what is good for the bottom line. And Bill's Behemoth is always right, especially when it's in the wrong. These guys make me sick.
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Buzz, 9 Mar 2007 @ 10:01pm

the sad truth...
This is exactly how I feel about Microsoft. They used to be a nice company. I was excited for subsequent Windows OS releases. As Windows 98 was coming out, we would fantasize about Windows 2000. We thought the name itself was so catchy that they'd have to make it; sure enough, they did!

Microsoft started doing things I did not like. I did not develop my opinion of them based of articles I read. I simply made my own observations and noticed how lacking they were in the innovation department. That's pretty much when Google caught my eye.

Sadly, Google may end up the same way. They're on a roll right now, but one day I might be despising them for being overbearing. I hope we never see that day. This Techdirt post reminds me of the RIAA; they had their moments when CD music was hot, but now they just profit by suing everyone. Great plan, guys... :(
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Buzz, 9 Mar 2007 @ 10:05pm

oops
I wish we could edit comments. Anyway, I must've forgot a sentence in there. I meant to say, "my friend and I would fantasize about Windows 2000"... The 'we' wasn't very specific. :P
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Uhm can you people read?, 10 Mar 2007 @ 12:12pm

What?
The earlier quote is by Bill Gates, the latter is by a MS lawyer!

I'd bet that Bill still stands behind his original comments. Even though if he had to stand behind a particular view point today, he'd HAVE to pick that of his lawyer. There's a big difference between ideals and business practice. He'd be doing MS share holders a HUGE dis-service not advocating whatever LEGAL strategy makes the company profits.

Now that said, what needs to happen is change in Patent law such that Bill's early days views are enforeced in the future, then the playing field is leveled.
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Sarojin, 10 Mar 2007 @ 1:06pm

MS was innovative?
This article doesn't seem to consider the fact that MS never "innovated" anything. Stealing from Xerox and Apple, and then just buying up any of those small, actually innovative competitors, and forcing the MS way through standards bodies was not innovative. Well, unless one counts poor results as innovative.

MS has been using their market position of dominance for years and years to either stifle, destroy, or buy any threat to their dominance. Now they just doing it via the high-powered lawyers they can afford.

MS has not changed anything, imo, other than the tactics they use.

And since there is no chance of making millions in stock options and their benefits are only average, all the really talented people are looking elsewhere for employment.

I shudder at the thought of someone actually fantasizing about Win2k, heh. Beautiful women in exotic places, winning the lottery, my in-laws never visiting again...that's fantasy material. But a freakin' Windows OS, oh dear!
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DT, 10 Mar 2007 @ 2:44pm

Jaded ppl are so sad.
MS certainly has helped push the PC generation to where it is today. To say thats not innovative is a sad lie and complete ignorance of facts and history. Its not Bill's fault Xerox didn't know what they had or how to market it. Apple didn't steal they idea they cultivated it and gave it relavence. MS did the same with reguards to the GUI interface. Yes, others had tried to do it, but MS happen to be at the right place at the right time and actually made it into a commonly useful tool.

Caveman A carved a rock into a circle and pushed it down a hill, but only saw his invention as an interesting toy.

Caveman B saw Caveman A and decided to do the exact same thing, but this time used it to help move a heavy boulder.

Which was innovative?
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Exley, 10 Mar 2007 @ 6:56pm

Caveman A sues Caveman B for "stealing" his idea :-P
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Exley, 10 Mar 2007 @ 6:57pm

Caveman A sues Caveman B for "stealing" his idea :-P
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Exley, 10 Mar 2007 @ 6:57pm

sorry hit the refresh button
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Context..., 10 Mar 2007 @ 11:10pm

Re: Jaded ppl are so sad.
To say thats not innovative is a sad lie and complete ignorance of facts and history

Innovation and Marketing are two different things. Both can be genius, but they are not the same...MS Is not innovative. never was. never will be.
But they are amazing business strategists and marketers...can't anyone take that away from them.
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Hmm, 11 Mar 2007 @ 3:04am

How about this example?
Microsoft is still filing patents as an "innovator". Look at this example:

http://www.bluej.org/mrt/?p=21
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Doug, 11 Mar 2007 @ 3:59am

Not necessarily contradictory
I guess I haven't read the articles closely, but I don't see any contradictions after a quick read. Neither do I see a contradiction in the two quotes from Bill Gates. I've seen similar quotes on both sides of the issue on TechDirt. Patents can be good or bad, depending on how they are used.

Patents are a two-edged sword. Appropriately used, they allow a company to take advantage of a new idea without fear that the idea will be immediately stolen by their competitors. Abused, they create a chilling effect that allows a patent holding company to take advantage of the hard work of another company that managed to make an idea successful. You should expect to see good arguments on both sides of the issue, perhaps even from the same person.

I'm not surprised that Bill Gates is in favor of the general idea of patents but concerned about how they are used. Microsoft is builting up its own patent portfolio at the same time that it is fighting billion-dollar patent lawsuits in court. The general idea of patenting isn't completely wrong, but specific lawsuits might be way off-base.

Quick question: how often do you see Microsoft in the news because it is suing another company over patents? You must admit that it isn't often.

The way the current system works, if you're not sure whether something is patentable, it is best to apply for a patent just in case. That's the way the game is played. It would be foolish for Microsoft to not apply for patents as often as possible. It would be equally foolish for Microsoft to go after people infringing on some of its weaker patents.

The real proof of "evil" or "not evil" is not based on whether you support patents or not. Neither is it based on whether you apply for a patent or not. The real proof is whether you sue somebody over some obvious or submarine patent.
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rday, 11 Mar 2007 @ 11:05am

Re: Not necessarily contradictory
Well, you may not see Microsoft actually suing over patents, as yet, but there have been plenty of recent occasions of Microsoft (Steve Ballmer, in particular) threatening to do so. Such a threat from such a huge Gorilla (meaning Microsoft, not Ballmer, necessarily) can stifle true innovation. The prospect of Patent Wars looms ahead, and it can't be good for ANYone.
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misanthropic humanist, 11 Mar 2007 @ 12:08pm

growth and protectionism
Anybody under 30 years old who isn't a socialist doesn't have a heart, but anyone over 30 who isn't a conservative doesn't have a brain.

Have you ever heard that before? I think it fits the situation you describe vis companies, growth and patents like a glove.
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loaders, 11 Mar 2007 @ 7:40pm

Sounds like openly innovated at first and protecting patents later is how you make the most money. Microsoft is a company it will do whatever will make the most money and nothing else.
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