Update On The Free Summit: Speakers Announced

from the update dept

Wanted to give everyone an update on The Free Summit that I'll be emceeing next month. We've lined up most of the speakers, so check out the agenda. As already mentioned, Chris Anderson will be doing the keynote, talking about some of the concepts from his new book on "Free" (I'm reading it now -- and it's great). There will also be two panels that should be quite interesting. One of the things that we wanted to ensure was that the panels we put together didn't just involve people who all agreed with each other (or with me, certainly), so that the discussion would remain quite interesting. So, on the panel about music, we're having Jim Griffin (who I've certainly clashed with in the past) from Choruss, the major record label-backed attempt to come up with a new business model for licensing music, Gigi Sohn from Public Knowledge, the public advocacy group that has taken a strong pro-consumer position on copyright issues, and Dave Allen from the seminal band Gang of Four, a big advocate of "free," and who now helps plenty of other bands learn how to embrace and profit from "free." It should be an exciting discussion.

We've also got a panel on the news business, involving Kara Swisher from AllthingsD/Dow Jones, Dan Gillmor, the director of the Knight Center for Digital Media Entrepreneurship as well as one of the first "old school" reporters to jump on the participatory media bandwagon, Alan Mutter, a journalism professor/investor/entrepreneur/former reporter who's been a vocal critic of newspapers' decision to go free online (calling it "the original sin") and Marshall Van Alstyne, an economics professor from Boston University and MIT who has studied information economics and who recently debated with Mutter and others on the Freakonomics blog about news organization business models. There will also be a session from Alex Iskold (another person I've disagreed with in the past) who will be presenting on "the dangers of free."

What's great about this is that it really is a mix of folks with (sometimes starkly) different opinions -- but who all believe quite strongly in their positions and are willing to discuss and defend them. I'm hopeful that what comes out of all of this will be some great new insights from all sides about what "free" means in terms of business models and economics today.

Finally, we're excited to announce that, as a part of this, we'll be including a mini-Techdirt Greenhouse at the beginning of the event. For those who have followed Techdirt for a while, you may recall we ran a series of "idea workshops" called the Techdirt Greenhouse, where individuals would do short, 5-minute presentations not as a "demo," but to discuss a challenge they were facing -- and then we broke up the audience into workgroups to take on those challenges and come up with ideas/plans/suggestions. Those events were a lot of fun, and we received a ton of great feedback. We've been meaning to start them up again (and we still get emails from attendees demanding we do so), but have been too busy to focus on them -- so this is a good way to sneak in a mini-Greenhouse, and also get us geared up to do a full Greenhouse again in the near future. In this mini-Greenhouse, we'll be focusing on the challenges associated with using "free" in a business model. It should be a lot of fun...

Filed Under: alan mutter, alex iskold, chris anderson, dan gillmor, dave allen, free summit, gigi sohn, jim griffin, kara swisher, marshall van alstyne, speakers

Misunderstanding The Problems Of The Patent System

from the it's-got-problems,-but-not-these dept

Earlier this year, Alex Iskold wrote up a piece on why the economics of "free" was somehow bad. That didn't make much sense and we tried to explain why. Now he's written another article trying to explain why the patent system is in crisis, and it seems equally as confused. We absolutely agree that the patent system has some serious, serious problems -- but it's not for the reasons Iskold describes. First, he claims that the patent system used to work -- when historical evidence suggests otherwise. Almost every look at the patent system over history has found little to no evidence that it increased innovation. From Fritz Machlup to Eric Schiff to the more recent research of Scherer and Weisburst and others have consistently found little evidence that patents increase innovation.

Iskold, oddly, suggests that the reason why we're seeing open source rise up and an open sharing of ideas proliferate is somehow because of the patent system's failures (despite the fact that both became more prevalent and common long before software was considered patentable), and warns that this is somehow dangerous, because: "What happens when a big company copies a startup? What happens when dozens of startups copy each other?" Of course, that's what most people consider competition, and we tend to think it's a good thing in a capitalist society. It's what actually drives innovation, as pretty much all of economic history has shown. If someone copies you, you continue to innovate and beat them to the market. If you really understand your market better, then you can out-innovate them. And, despite continuous worries about "big companies" copying startups, history shows that it's not quite so easy. If the startup is successful, it's not so easy to just copy, because the startup has built up a reputation, which isn't so easy to copy. Witness how Netflix outran Blockbuster, despite Blockbuster copying Netflix. Witness how Google outran both Yahoo and Microsoft. Witness how Microsoft outran IBM.

It's not so easy to just "copy." And just copying isn't enough to actually gain marketshare.

From here, Iskold's column skids off the rails completely. It claims that the real problem of the patent system is the time between filing the patent and when the patent is granted, because that allows plenty of other companies to copy your patent and beat you to the market. That's so wrong it's difficult to know where to start. First, patents aren't published until 18 months after being filed. So, no matter what, you have an 18 month headstart. And if we're talking about software firms, that seems like a pretty damn big headstart. Furthermore, there's very little evidence of startups or even larger companies in the software space scouring patent applications to "steal ideas" from others. No, they tend to focus on what the market is actually asking for. And, in fact, there's ample evidence that many software firms actively forbid employees from looking at patents, as doing so may open them up to treble damages for "willful infringement."

Iskold seems to think that this patent scanning is what leads to tons of "me too" startups -- but the truth usually has absolutely nothing to do with the patent system. It's because multiple people recognize the same or similar markets, and over time are likely to attack it in similar ways. Again, that's competition -- and it's a good thing.

Oddly, towards the end, Iskold finally admits what he calls "the biggest irony in this patent debacle": it actually benefits consumers. That's not "irony." That's correct. Competition benefits the customer. That's how it's supposed to work. So what's the problem?

Well, according to Iskold, this isn't sustainable: "To not have patents at all means that at the end of the day big companies will always absorb all the best innovation for free." But, again, as we already pointed out, that's simply not true. Sometimes big companies win, but quite often, they do not. Big companies are slow and lumbering. Small companies are faster and more nimble and can often out innovate the slow companies with legacy issues. Competition is a good thing, Alex. Don't fear it.

Filed Under: alex iskold, patent system, patents, problems