Can Congress Work Like A Tech Startup?

from the as-long-as-they-don't-drop-vowels dept

We've discussed a few times in the past Rep. Darryl Issa's Madison platform for crowdsourcing ideas around legislation. Over the last few months he's used it to create a productive discussion around the OPEN Act, the more reasonable alternative to SOPA/PIPA, and also used it to post the text of ACTA for discussion. While the platform may need some tweaking and advancement, it's still quite a feat to see someone in Congress actually innovating, and that should be encouraged. Joshua Lamel -- who admits that he's politically at the other end of the spectrum from Rep. Issa -- has a really nice profile of how Issa is trying to treat his job in the House like a "lean startup," with projects like Madison. It is a bit of a slog going up against the entrenched ways that Congress acts today, however:

"I try to bring a lean startup mentality to my work making government more efficient, open and participatory," he said.

"This technology-centered approach, however, is disruptive to the government bureaucracy and many in Congress because it demands experimentation, data-driven analysis and actually listening to our users -- the American people -- about how to make government work better for them. That's why social media and innovation are so central to my work: we in Congress do not have all the answers, but we can have a relentless drive to adapt technology to let taxpayers re-engage with government on their own terms. I firmly believe that just as new technologies are revolutionizing nearly every aspect of life in America, nascent tools like Madison show the transformative impact technology will have on government, and ultimately overcome the inertia of the bureaucracy."

While not a traditional industry, it sure seems like Congress could use some significant disruption -- and having people in there treating it like a startup might just be a good way to start.

Filed Under: acta, congress, crowdsourcing, darryl issa, madison platform, open act, pipa, sopa, startups

Ongoing Patent Fights Mean Startups Are Now Wasting What Little Money They Have At The Patent Office

from the not-cool dept

Last week, I had the chance to chat with the General Counsel of a well known internet company -- not a "giant" one, but one you've almost certainly heard of -- and we got to discussing Twitter's new patent assignment agreement with its employees, and whether or not other tech companies would start offering the same thing. He was a bit skeptical, and pointed out that, even at a company the size of his (big enough to have a full time general counsel, for example) they had applied for exactly zero patents. He said he's tried, but none of the engineers at the company have any interest at all in patenting what they're working on (actually, in talking to someone else later on, I heard that the bigger issue is that some of the employees are thinking about ways to open source their work). Either way, the lawyer noted that, because of that, any patent assignment agreement was something of a waste of time. His company just wasn't interested.

Unfortunately, it appears that not all startups are working that way. With Yahoo's patent fight against Facebook getting so much attention these days (not to mention other big patent fights involving companies like Google, Apple, Microsoft, Oracle and others...), it seems that startups are (rather reluctantly) spending a lot more time (and money) at the Patent Office.

This is, to put it mildly, crazy. The two biggest scarce resources for startups are time and money. Throwing them away on getting patents is a huge waste, and it's main purpose is to act as insurance against failure or against jealousy over extreme success. Basically, most patents are completely useless. But if a company is failing, then perhaps it can sell off its patents. And, if a company is succeeding, then suddenly others will start suing it for patent infringement -- and the hope (rarely realized) is that having at least a few patents in the portfolio means that other practicing entities won't sue for fear of getting sued back (patent trolls are exempt from this, however).

It's really too bad that the state of the patent world today is such that are most innovative companies are basically forced to throw away time and money to apply for patents they never want to use.

One separate aside on this story. The article talks about the Twitter IPA agreement, and later quotes the founders of the startup Everyme as saying they support the IPA, but: "their first three apps were already with the U.S. Patent and Trademark Office by the time IPA was available, though, and they don’t plan to refile them." This sentence makes no sense. The IPA has nothing to do with the USPTO and the patent filing. It's merely a part of the assignment agreement, leaving some portion of control with the inventor. In fact, Twitter -- who does have some patents -- has said that it's using this agreement retroactively with patents that were applied for before the IPA existed. So there's no reason to refile the applications at all. In fact, the IPA is entirely separate from the actual patent application.

Filed Under: ipa, patent assignment, startups, uspto
Companies: apple, google, microsoft, oracle, twitter, yahoo

Congrats, US Government: You're Scaring Web Businesses Into Moving Out Of The US

from the destroying-business dept

The federal government has been paying lip service to the idea that it wants to encourage new businesses and startups in the US. And this is truly important to the economy, as studies have shown that almost all of the net job growth in this country is coming from internet startups. Thankfully some politicians recognize this, but the federal government seems to be going in the other direction. With the JotForm situation unfolding, where the US government shut down an entire website with no notice or explanation, people are beginning to recognize that the US is not safe for internet startups.

Lots of folks have been passing around this rather reasonable list of activities for US-based websites:

Today's sysadmin todo list:

0. Get corporate membership with EFF.

1. Identify all applications with user-generated content.

2. Move all associated domains to a non-US based registrar.

3. Migrate DNS, web serving and other critical services to non-US based servers.

4. Migrate yourself to a non-US controlled country.

I'm sorry for US sites and users. Your government is hell-bent on turning the internet into a read-only device like TV, easily regulated and controlled. The population will be required to sit quietly and keep their eyes glued on the screen so they don't miss the ads, with any infringers deemed terrorists and pedophiles and thus deserving of summary punishment by DHS squads.

Hopefully the internet will route around the damaged segment, and the rest of us can continue to enjoy the amazing interactivity it has brought our society.

What's amazing is the "what's the big deal?" attitude the government has taken to all of this. For most of us, this situation is shocking. The US government should never be able to flat out shut down a business with no notice or explanation, only to say "sorry" a couple days later. It's done this in the past and insisted that it would be more careful in the future. So far, it doesn't appear to be living up to that promise. While these may be "mistakes," the wider impact should be frightening to federal officials. They're now actively scaring startups away from US businesses at a time when they should be doing exactly the opposite.

Filed Under: censorship, entrepreneurship, seizures, startups, takedowns
Companies: jotform

Congress Actually Helping The Internet, Rather Than Mucking It Up?

from the could-it-be? dept

We're so used to Congress trying to muck up the internet, that it's rare we hear about cases where they're actually looking to make things better. While the idea has been floating around for a little while, (and the actual bill was introduced back in December when we were focused on the whole SOPA/PIPA debate), the Startup Act is starting to get some attention, with co-sponsors Senators Jerry Moran and Mark Warner taking to the WSJ to explain why the Startup Act is important. The basic idea behind the bill is to remove some of the regulatory hassles of starting and building a new company. As we've pointed out repeatedly, studies have shown that pretty much all of the net job growth in the US comes from startups, and a bill like the Startup Act should help make it easier for startups to get going. To be honest, the bill could be even stronger in a bunch of places, but as a starting point, it's definitely nice to see. The focus is on making it easier for startups to be startups by doing the following:

• It will make permanent a capital gains tax exemption on the sale of certain kinds of small business stock that is held for at least five years. In other words, it will encourage long-term investment in startups, which is just the kind of investing we should be encouraging (rather than quick flip type investing, which is more about gambling on changes, rather than investing in economic growth).
• It decreases corporate taxes on new businesses during their first three years of profitability -- again making it easier for young companies to grow and to reinvest their own profits in jobs and growth.
• While it doesn't do away with crippling government regulations for small businesses, it does require a cost-benefit analysis of the economic impact of many of those regulations on startups.
• It implements a simplified form of the startup/founders visa -- which is about helping non-Americans start companies and create jobs in the US. We've talked about the startup visa in the past and why it's a good idea. No matter how you feel about other immigration issues, this one is pretty clearly about having immigrants create jobs in the US (rather than elsewhere).

There are a few other things in the bill, but overall the key point is to basically get overbearing regulations out of the way. These are regulations that bog down many startups (or prevent them from getting started at all), and really put a drain on the key part of the economy that is contributing to both job growth and economic growth. It's rare to see Congress trying to do something that helps the internet, rather than mucks it up, so we should certainly highlight when such efforts are being pushed forward. I have a few quibbles around the edges on pieces of the bill, and really think it should go further in other areas, but on the whole it's a really good start.

Filed Under: jerry moran, mark warner, startup act, startups

Another Answer To Dealing With Piracy: Keep Creating Better Tools & Business Models

from the they-keep-on-coming dept

We've already discussed, a few times, how the tech/startup industry has repeatedly given the entertainment industry the "solution" to piracy, in the form of new tools, services and business models, which are helping many "compete with free" by offering something better... all without regulation. Unfortunately, the entertainment industry still seems to think that the only solution is to pass laws that try to do the impossible: stopping piracy. This is the wrong approach. They're not at all focused on revenue maximization, they're so obsessed with the idea that infringement represents a "loss," that they're missing out on the fact that they're missing tons of opportunities to make more money.

Dante Cullari, the founder and CEO of Beat-Play (and a musician himself), has a post up on Music Think Tank, noting both the impossibility of stopping file sharing, and wondering why the industry doesn't embrace new solutions (like his, of course) that allow them to compete. He further notes that the solutions the industry are suggesting clearly show a lack of understanding of how people use the internet. Putting up a paywall? Good luck with that:

To me it seems pointless to even bring up the prospect of a subscription service, or even a pay-as-you-go model as a viable solution for a future sustainable industry model. This is because the internet, now the basis of content consumption, is like a huge river of information. A paywall is like a little pebble being thrown into it. The water in the river has no trouble getting around the pebble. Paywalls will never solve the piracy problem, and damming up the whole river, as we’ve seen with SOPA, will not be easy, and most likely will never happen.

Really though, I don’t think that the actual problem that the rights holders have with piracy is the copying, but rather it is the loss of revenue brought about by the copying that motivates the rights holders into action. They want to be rightly compensated for their work. Who wouldn’t? The problem is that the business model - the mechanism that they’ve chosen to help them receive compensation, is not only a little dated, but it has been proven ineffective in this new environment that is very different from the one we saw even 15 years ago.

The rights holders need a new mechanism for compensation. It’s that simple. Why they’re trying to preserve the one they have, I really don’t know. But the sooner they accept the fact that it is broken and it’s time to get a new one, the happier they will be.

Of course, plenty of us have been arguing for over a decade that it's better to recognize the reality of the market, and then use that to your own advantage. Perhaps early on there weren't enough tools and services to make such new business models a reality, but these days it's impossible to argue that such alternative revenue sources no longer exist.

Beat-Play's model is based on using music from artists within brand-driven games (for example a Facebook skiing game, paid for by a ski apparel company, using a band's music), which lets fans hear free music, while also allowing companies to better track who their audience is. This really is an example of the "ads as content, content as ads" model we've discussed for years. I have no idea if Beat-Play will work. Execution matters quite a lot, of course, as does the willingness of those in the music industry to recognize that this is a viable path forward, but conceptually the idea makes some sense. It doesn't try to force consumers into a model they don't like. It doesn't try to be annoying or interruptive. It just tries to set up a system that lets fans do what they want, while also giving content creators a good way to get paid as well. That seems like a solution that's a lot more reasonable... and a lot more likely to lead to more revenue... than something like SOPA.

Filed Under: business models, file sharing, startups
Companies: beat play