VC Explains How Damaging Software Patents Can Be
from the thank-you dept
Despite claims that no VCs would ever invest in companies without patents, we've been seeing more and more VCs moving over to the side of recognizing that patents are more often hindering their portfolio companies rather than helping them -- and these are some of the most respected VCs around these days. Brad Burnham, who has already called for an independent invention defense for patents has responded to Nathan Myhrvold's ongoing campaign to legitimize patent shakedowns. Burnham has written up a detailed post on how and why software patents are so damaging. It comes back to the same point that we've been making for years: truly inventive people don't need a patent as incentive to invent: they just need a need in the marketplace and they go and create. And, when there's a need, plenty of people are probably coming up with similar solutions -- but why do we limit the market to just one?Burnham talks about the experiences with his portfolio companies. First, in explaining why the software industry took off, he points out that Myhrvold is wrong in suggesting that it was intellectual property protection that resulted in software becoming an industry:
The real reason the independent software industry emerged is that operating systems and APIs made it possible for independent software vendors to develop applications independently. They no longer had to ask permission of the hardware vendors. This same characteristic of permissionless innovation led to the explosion of independently created services on the internet. The rampant abuse of the patent system has created the opposite condition for the creators of software and web services today.From there, he puts to rest the myth put forth by our favorite patent supporters in the comments that every tech company should just do a simple patent search and they'll be "safe" by pointing out how unrealistic that is. An entrepreneur, who Burnham knows, gave this example:
Not only is it becoming impossible to invent new services on the web without the permission of a patent holder who claims to own the intellectual property embodied in your invention, it is impossible to know who you need to ask permission of.
I hired several firms to search for patents that our service might infringe. Each of them came back with completely different patents and each time I sent them back to do it again, they came back with still more different patents. When I searched myself in the patent database, each time I entered the same search query, it would return different results. None of these patents seemed to cover what we did, so I eventually gave up.But the real issue here is the total myth that tech companies infringing on patents are "stealing" ideas from others. Time and time again, the actual details of lawsuits have shown that it's almost never the case that a company accused of infringing ever actually knew about the original patent. Instead, it's almost always an independent invention. And yet, Myhrvold persists with the myth that techies are going out and "stealing" the ideas of others. Burnham points out how rare this seems to be:
I have been investing in software and web services since 1993 and have worked in venture backed startups since 1985. I have never met the people Nathan is describing here. I have never been a party to a discussion about ignoring someone's intellectual property rights for the sake of market share or to free up expansion capital. If anyone can point me to the clear cut abuses that Nathan is describing, I'd be grateful. My experience has been the opposite. As I described in this post, the companies I work with invest a huge amount of time and energy creating a service from scratch only to find after they have launched and become successful that a patent holder they have never heard of, operating (if they operate at all) in an entirely different market claims that our company has stolen their property.Indeed. This is the key sticking point. Patent system supporters love to create this false imagery of the independent inventor who had his "idea stolen" by some big company. And, there's no doubt that there are very rarely stories of some company copying an idea from someone else -- but it's pretty rare -- and usually it just happens in the course of traditional competition. When McDonald's launches chicken nuggets, should that mean that Burger King cannot do the same? That's the nature of competition and it's what leads to greater and greater innovation. What Myhrvold is pushing does not lead to greater innovation at all, but to the hoarding of information and to the limitation on the necessary process of experimentation and competition that result in real, and necessary, innovation.
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Filed Under: brad burnham, innovation, patents, software patents
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Damn nugget pirates
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3-2-1
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Re: 3-2-1
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Re: 3-2-1
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That doesn't matter. his company will be the controller, so he can have a monopoly on his patent, so then his company will make money and litigate anyone else who dares defy his company's monopoly.
It isn't about this idealistic goal of constantly improving technology and humanity's knowledge; it's all about the money. Money is the sole motivator.
[/devil's-advocate]
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Remind me again what the sole purpose of patents is?
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On Idea patents...
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Re: On Idea patents...
Great post otherwise -- very much in agreement with you.
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Re: Re: On Idea patents...
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Held For Moderation?
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To date the patent holder (who wasn’t the inventor of record, just the current “owner” of the “intellectual property”) hasn’t released a product or service implementing the patent.
This wasn’t some sort of life–saving device. No one is going to miss another advertising platform. I’ve moved on, though the investor contacts me once a year to ask if I am still working on that product. The patent holder has lost whatever income he could have received had he licensed the patent.
I’m not entirely anti–patent, but patent–holders should be required to provide a reference implementation, and required to license the patent, especially if they’re not actually implementing the process it describes. The current system is such a nightmare that 1) I can't risk searching the patent database to actually learn anything even if I wanted to legitimately license the patent because 2) patent holders are far more interested in litigation than licensing and 3) it’s far too easy to get patents on obvious software processes because the USPTO doesn’t have the skills to do a Google search.
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Funny Software patents have been a shake since the 80's and when the .com boom of late 90's came about.. all sorts of irrational things started happening, Software patents are an artifact of the erroneous "idea economy".
in 98... we got screwed..
http://www.bitlaw.com/source/cases/patent/State_Street_Bank.html
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Patents, Universities and Idiocracy
I once worked for a Norwegian company that tried to patent the idea of 'correlation' and further claim it as 'prediction'. It was impossible to explain to the idiots involved that correlation is not the same as prediction and that correlation should have been patented by the old Greek. The patent agency we worked with at that time (Frank B. Dehn), also saw no problem in claiming that we invented correlation. It was just amazing. For those interested in 'proof' of this stuff: http://werner.yellowcouch.org/Papers/patent/index.html Claim 16 goes even further and claims that we invented 'rank' based correlation, which oddly enough already has a name: Spearman rank order. This became after a while such a bad employer-employee relation that I left (good riddance).
Another observation I can make over the past few years is that even universities try to patent 'inventions', which is exceedingly odd, because they take money from the citizen to do research. Why does 'the citizen' need to pay a 2nd time when something valuable comes out ?
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Re: Patents, Universities and Idiocracy
here are just a few examples of EU issued patents
________________________________________________________
1. Webshop: Selling things over a network using a server, client and payment processor, or using a client and a server - EP803105, EP738446, EP1016014
2. Order by cell phone: Selling over a mobile phone network - EP1090494
3. Shopping cart: Electronic shopping cart - EP807891
4. [CDs] [Films] [Books]: Tabbed palettes and restrict search - EP689133, EP1131752
5. Picture link: Preview window - EP537100
6. Get key via SMS: Sending key to decrypt bought data via mobile phone network - EP1374189
7. View film: Video streaming (segmented video on-demand) - EP633694
8. Copy protection: Encrypt file so it can only be played on authorised devices - EP1072143
9. Credit card: Pay with credit card on the Internet - EP779587
10. Adapt pages: Generate different web page depending on detected device - EP1320972
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Re: Re: Patents, Universities and Idiocracy
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Re: Patents, Universities and Idiocracy
In summary: The following in particular shall not be regarded as inventions ... c) ... programs for computers.
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Re: Re: Patents, Universities and Idiocracy
http://www.mondaq.com/article.asp?articleid=93174
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Re: Re: Patents, Universities and Idiocracy
Wonderful - lets buy this one - whatever it costs it would be worth it then refuse to licence it to anyone and kill DRM!!
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Re: Patents, Universities and Idiocracy
As I understand patent law outside of the U.S., patents are awarded on a first-to-file basis, not first-to-invent. So even if ancient Greeks had already invented it, if they didn't patent it then the patent was up for grabs by the first to file for it. I imagine the patent agency as well as your company understood this very well and were just going for a perfectly legal land grab.
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So, if you're working on an invention in Europe and word leaks of it before you get a patent filed, then it's no longer patentable?
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Re: Re: Re: Re: Patents, Universities and Idiocracy
No answer for that, huh?
Gee, I wonder why.
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two sides to an argument
I agree independent invention is very likely in the software world, but the real trick is how do you separate them from just copycats?
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Re: two sides to an argument
Indeed, there are more than 2 sides to any argument. For policy decisions, one method of figuring out what to do is called a "prima facie" case. One of the factors of that case is "inherency", that is, does the proposed solution fix the stated problem. Another part is the cost/benefit analysis, because everything has a cost (opportunity cost, maybe, but still a cost).
All that I would ask is that changes to copyright/patent enforcement be subject to a "prima facie" analysis, complete with inherency and cost/benefit analyses. If such an analysis was ever produced, I think it would always come down on the "less enforcement" side of the balance.
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Re: two sides to an argument
If your worries are true, why is it the big companies are the ones FOR software patents? They are the ones afraid of competition, afraid that something new might rock their boat. I have never met a software developer that was for patents, and I have met a lot of them. To the people actually writing the code, being able to patent software seems ridiculous and a hindrance.
I agree independent invention is very likely in the software world, but the real trick is how do you separate them from just copycats?
Why do you have to? We have copyright laws to cover blatant copying. We have anti-competition laws. Beyond blatant abuse, companies should have to compete on who puts out the better version of the same ap. What is wrong with that?
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Where's RJR?
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Re: Where's RJR?
Having lunch with The Anti-Mike to discuss new ways to troll discussion boards.
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An article how software patents tangle video streaming.
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Airplanes and patents
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Re software patents being recent, IBM obtained software patents starting in the late 60s. They are neither new, nor particularly different. Anything you can implement in hardware I can implement in software. How do you separate the two? Or are you against patents as a whole?
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