Intellectual Ventures Tries To Rewrite The Script, Pretends The Plan Was Always About Making Stuff, Not Trolling
from the that's-complete-bullshit dept
And, here we go again. Intellectual Ventures, the world's largest patent troll and a general tax on innovation, diverting over $6 billion away from actual innovators, has always been really stunningly good at getting the tech press to repeat questionable claims about its "real intentions" and how it's helping to "drive innovation." Every time the negative press catches up to IV's really nefarious practices, it comes up with a way to try to spin the story around again, like that time it tried to claim its real goal was to help everyone sort through good and bad patents.But the true story has never changed. IV bought up tens of thousands of crappy patents from University tech transfer offices that were desperate to get those patents off their hands to show some kind of justification for having a tech transfer office in the first place (many universities set up tech transfer offices thinking they would make those universities rich off of licensing patents -- and the reality is that the vast majority of them have lost tons of money). We've even heard accusations that IV helped pioneer a really cheap tax scam, getting companies to "donate" patents to universities, claiming they were worth lots of money for the tax writeoff, and then IV would buy them up on the cheap.
But the only thing IV has really done is to bully lots of companies, getting some to pay hundreds of millions of dollars to avoid lawsuits, and then suing many more. The fact that it's lost a bunch of those lawsuits recently, and rulings like CLS Bank v. Alice, mean that the actual value of IV's patent portfolio is rapidly dwindling. And its power to force companies to pay up is dwindling as well. That's why it was recently desperate for new cash (hey, where did that $6 billion go?) and even had to lay off 20% of its staff. No one believes the spin IV gave for those layoffs: that they had learned how to be "more efficient" in evaluating patent quality.
But now IV appears to be testing out its new spin, claiming that it's really now going to focus on making things rather than suing and shaking down companies. The company claims that was always the plan, but it wasn't. I've spoken to people who got the early IV pitch. That was never a real part of the plan. But, IV now realizes that the trolling label has stuck to it, so it desperately wants to create some product (any product!) that it can point to, in order to drop the troll claim. Nathan Myhrvold's ridiculous story about stopping Malaria with lasers isn't fooling anyone anymore.
Here's Business Week on IV's "transformation":
Having earned billions in payouts from powerful technology companies, IV is setting out to build things on its own. Rather than keeping its IP under lock and key, the company is looking to see if its ideas can be turned into products and the basis for new companies. The first wave of products includes an ultra-efficient nuclear reactor, a waterless washing machine, self-healing concrete, and a giant squeegee for sucking up oil spills. One country has asked IV to help lower its temperature, and another wants it to create robots that can replace migrant workers.And yet, there's no evidence that any "big problems" have been solved. None. IV has always had its labs, but those were basically just for show to convince gullible journalists that something was happening there. But the difference between an idea and a viable product is a huge gulf, and IV seems to pretend it's the same thing.
As part of its transformation, IV fired 20 percent of its employees, about 140 people, most of whom were tied to its patent business, on Aug. 19. A new team busy turning ideas into products has raised millions of dollars to fund a flood of IV-backed startups. A network of 25,000 independent inventors submits ideas for review by IV and earns royalties when products based on their ideas reach market. Says Edward Jung, IV’s chief technology officer and co-founder, “We have built an engine that can solve big problems.”
But, IV is pretending this has always been the plan. It's just spent the last decade plus not building products so that it could take the time to build an engine that could build products -- even if it hasn't yet.
As far as Jung is concerned, it’s Silicon Valley, not IV, that has lost the plot. A former child prodigy and chief architect at Microsoft, Jung argues that venture capitalists have become obsessed with trifles such as social and mobile apps, while large corporations have pared back their research and development budgets. “Everything has moved toward the short term,” he says. “The public markets have gotten so efficient, and they’re not pleased when a CEO says, ‘Hold on. Give me 10 years, and I’ll figure this out.’ ” IV, he says, has been taking the long-term view all along. First it had to amass a patent portfolio. Then it needed to learn how to mine it for great ideas. Now it’s time to put those ideas to the test. Critics who only saw IV as a giant IP collector misjudged the company, he says. It will soon be pumping out dozens of revolutionary products.Except note, again, the overvaluation of ideas to execution. People who execute and build successful companies know that execution is the difficult part. The idea is important, but execution almost always changes the idea anyway. Ideas morph quite a bit when touched by reality. And the whole "long-term/short-term" story is a popular one. We hear people claim it every few months, but it's also bullshit. Anyone who's spent any time in Silicon Valley knows that there are tons of companies making huge long-term bets. Yes, there are short-term things as well, but the big world changing things quite frequently come out of those "trifles". And that's because real innovation comes from taking ideas and learning from the market and continuing to innovate.
It's only the myth of the "big idea changing the world" that leads to thinking like this. But that's not how innovation actually works.
Either way, Business Week seems to have been suckered in by the same "laboratory" that IV loves to show every visiting journalist:
It’s impossible to tell the story of Intellectual Ventures without a visit to its laboratory in Bellevue. Spread across five buildings in an industrial part of the Seattle suburb, the campus is the workplace for 170 scientists, 40 of them Ph.D.s. They have access to more than 8,000 pieces of scientific equipment, including mass spectrometers, lasers, particle sizers, and a hydraulic airplane wing bender. If the engineers need to weld metal or saw wood, they can do that in a giant machine shop. Scientists who work in the IV labs must come up with ideas, test them, and then either patent them or move on to the next thing. Soon the lab will relocate from this 50,000-square-foot setup to an 80,000-square-foot one.Right, but what product have they made that is actually on the market? We'll wait. And wait.
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Filed Under: nathan myhrvold, patent trolling, pr
Companies: intellectual ventures, iv
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What is the lab complex called?
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What IV should remember
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Not long ago, Techdirt featured the Hyperloop project in one of its daily "cool stuff" articles. And yes, it's definitely cool, and more than that, it's necessary. We need something like Hyperloop to improve the efficiency of our transportation and reduce the pollution it generates if we're going to survive and continue to grow and progress as a species.
Well, here's something I ran across a while back that really makes you stop and think: Why silicon valley funds Instagrams, not Hyperloops.
These guys are right: The current system is badly broken. (Please note that I am not saying that their solution to the problem is a good one! It's always much easier to correctly diagnose a difficult problem than to come up with a good solution; just ask an oncologist. Or Karl Marx, for that matter.) But it's a bit distressing to see the idea so blithely dismissed just because of who it's coming from.
(Full disclosure: I am an engineer with the Hyperloop project. But I joined up because I sincerely believe that it's something the world needs.)
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Shaky logic
Interesting way of working. "First we had to buy a tonne of apples. Then we had to sort through them to find the good ones". Most people would probably do the sorting before the buying - you can save a lot of money that way.
"Now it’s time to put those ideas to the test"
So what was the "mining" step then ? Is it really a "great idea" if it fails the test ?
Oh, and why no mention of "and then we had to shake down a bunch of other companies" ? I guess that was needed because they decided to buy all the patents first, then figure out which ones were any good.
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Well
Law firms are being challenged to innovate new ways to save money while defending against baseless patent lawsuits...
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Oh
For some reason, I always read it as Intellectual Vultures.
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Re:
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I wonder how that laser mosquito killer thing is doing
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Another one?
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I hear they got a patent on something called "vaporware" and will have it in full production real soon now.
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Yes but no
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IV's touting assets and its employees' degrees
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Wild side
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Re:
A database? That's what that means in my line of work...
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Patent and move on
"Scientists who work in the IV labs must come up with ideas, test them, and then patent them and move on to the next thing"
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Re:
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