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Do Patents Still Work?

mossmann asks: "With all the fuss over software patents lately, I thought it might be a good time to take a step back and address a more fundamental question: Do patents work? The United States Constitution (Article I, Section 8) states that 'Congress shall have power. . . To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries;' In other words: Congress is permitted, but not required, to grant patents so long as they promote progress. Patents are not intended to bestow upon inventors any of the qualities of material property but are granted only to encourage innovation and publication." Good question! Have patents become unnecessary? I wouldn't go as far as abolishing them, but I think it's high time the system was heavily revised. (Read More)

"Here is my real question: What if we stopped issuing new patents in the United States: would 'the progress of science and useful arts' suffer? Prior to the advent of the Internet and the success of the Open Source movement, I would have said yes. Now I am not so certain. What do you think?"

Of course, these days, patents are used to prevent innovation more than anything else. I find this rather ironic.

More hilarous than ironic, this gem from Forge illustrates what can happen when the Patent system gets slightly out of control: "Hyperspace communications has been patented and is now my nominee for strangest patent. According to this story on the Register someone has not only "invented" hyperspace but has also figured out how to use it for transmitting data faster than light. My question is, does a fictional work count as "prior art"? To add to this concept Arthur C. Clarke is widely credited with having invented the communications satellite. The infamous band of space in which geostationary satellites orbit is known as "the Clarke Belt" in his honor. However he once said in an interview that he might have patented the idea if it had occurred to him that someone might actually build such devices such a short time after his story."

The big question here is how can you patent something that hasn't been invented yet? It seems that I can conjure up any flight of fancy that might just have a passing chance at becoming truth, patent it and make that idea mine forevermore?

const submitted a question that offers a potential solution: "I'm interested whether the patent madness may be stopped by restricting the number of patents in addition to shortening their time. If only 100 patents will be granted each year for the computing industry, only significant advances will be patented and things like the now infamous one-click patent will not get through the jury of experts in the field. The progressive scheme may be like the following: 1 patent - 10 years; 10 patents - 3 years; 100 patents - 1 year." which would make getting patents more of a competition between implementations, and to compete for the protections offered by patents sounds like a fair way to "promote the progress" in any given market.

54 of 158 comments (clear)

  1. Patents are only as effective... by ACK!! · · Score: 2

    as how we define them. Patents have been defined far too broadly in the courts as of late. The whole idea of intellectual property and the fact that the courts have effectively ignored the fact that many patents are just blatant attempts to capitalize on the obvious.

    For truly revolutionary and unique ideas, patents are an important protection for the people who create new technologies and industries. However, trying to patent ideas that are or would quickly become obvious to the whole of mankind is counterproductive and harmful to the population and industry as a whole.

    Patents are a logical protection under the law for creators, inventors and people of imagination that want to profit from their creation. However, when the law is interpeted too broadly we are stuck in a situation where idiot companies like Amazon can patent technology that is obvious to anyone who is not completely ignorant of the same said technology. Either the patent department needs to catch a clue or the whole set of laws surrounded patents need to be revised on a Federal level. However, ditching the laws wholesale is counterproductive.

    Maybe I am too conservative and not reactionary enough for some but the whole idea of throwing babies out with their bathwater is narrowsighted to me.

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    ACK /ak/ interj. 2. [from the comic strip "Bloom County"] An exclamation of surprised disgust, esp. i
    1. Re:Patents are only as effective... by Darguz · · Score: 2

      I think something we need to keep in mind is that this whole thing isn't over yet. The issue of such absurdly broad patents as Bezos' and Walker's, while they have been tested somewhat in the courts, still have a long way to go.

      Seth Shulman at Technology Review gives a good, fairly even overview of the situation. He quotes a patent lawyer who, I think, makes a particularly interesting point, "when there has been enough perceived inequity in the patent system, industry has revolted and other mechanisms have kicked in." In the case of e-commerce patents, he predicts "the courts will probably step in. Congress may have to step in. But you have to remember that all these forces, including broad societal forces, come together in a confluence that creates the law."

      I think the reaction and outcry to this issue have been, at the same time, excessive and necessary. Excessive in the sense that I think it will ultimately be resolved: I think it will ultimately be seen that this sort of patent defeats the purpose of the patent system. Necessary in the sense that, in situations like this, excessive reaction is necessary in order to drive the needed changes.


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      What? WHAT?!! Oh.
  2. Bestowing qualities by B'Trey · · Score: 2
    In other words: Congress is permitted, but not required, to grant patents so long as they promote progress. Patents are not intended to bestow upon inventors any of the qualities of material property but are granted only to encourage innovation and publication.

    If patents are not intended to bestow upon the inventors any of the qualites of material property, how then do they encourage innovation? Isn't it precisely because they bestow the ability to control and profit from an inovation that they encourage inovations?

    The question them becomes, does extending the strength and length of a patent beyond some arbitrary parameters actualy provide more encouragement? Will you spend more time or effort inovating and progressing if you know that you'll control your invention for 75 years rather than, say, 20?

    Finally, doesn't protecting uninovative and unprogressive items have the opposite effect? Aren't you likely to put more time and effort into research if you need to show true originality in your concept than if you can patent every flight of fancy which comes your way?

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    "The legitimate powers of government extend only to such acts as are injurious to others." Thomas Jefferson.

  3. Patents promoting progress by luckykaa · · Score: 5

    LZW is patented, so there is a move towards other compression algorithms, many of which are better in a general case. This suggests that progress was promoted. This is of course not how it was meant to work. The purpose is to allow other people to produce works based on the patented technology. This doesn't seem to be happening.

    It seems that the patent holder has too much control over how their patents are used. In the past this didn't matter so much. Producing a machine costs money. A small surcharge from the inventor of the machine wouldn't affect this significantly. If the inventor asks for a fair price then everybody's happy.

    The system breaks down when the patent owner uses the patent to prevent competition. Either by refusing to let anyone use the technology, or by charging too much to allow certain groups to use it. Because software can be produced on a shoestring budget, the latter is often unintentionally the case.

    1. Re:Patents promoting progress by streetlawyer · · Score: 2
      The purpose is to allow other people to produce works based on the patented technology. This doesn't seem to be happening.

      errrr... wasn't GIF based on the LZW algorithm? And in any case, the stimulation of development of other algorithms is definitely one of the means by which patents were intended to promote innovation.

      At least LZW is in the public domain, so people can build on it. If you get rid of patents, then people will protect their intellectual policy using trade secrets. And that's a much worse state of affairs than the current.

  4. It's not that patents aren't necessary... by Masem · · Score: 5
    ...but it's the damn length of time, AND the vagueness that people can get away with in some of them.

    Due to my research, I've looked at patents where they actually make sense; chemicals and chemical processing, in which the patent usually revolves around the composition of the catalyst used. Some of these are very narrow, but some cover huge numbers of possible compositions, as well as large numbers of possible elements to use. (Such as up to 20 metals as catalyst promotors.) This would be all well and good if their provided enough examples of these, but in most cases, only 2 to 3 examples are given, covering only a tiny amount of their 'composition space'. Sure, I know that one can extroplate that if platinum (a noble metal) works, then most likely other noble metals such as palladium will also work, but most of the metal selections don't have rhyme or reason-- they just take as many as possible.

    This is part of what needs to de done: the reviewing of the patent. Often I read that the patent office is swapped, and they have to push patents through as fast as possible to achieve their required quota, and furthermore, especially for computer-based patents, the expertise is not there. One solution is to throw more money at the problem and get more patent people in place with more viable skills with newer patents, but that's only half the problem.

    The other is the time factor. Earlier this century, when the speed of information transfer was limited to snail mail, telegraph, and the telephone, the disclosure of ideas would take a long time, and thus long times for the delays of patents was necessary. However, as we've got to television, satillite communications, the internet, and whatnot, information moves much much faster, and the same time that was required 100 yrs ago is not really needed. However, one must still considered that there are a considerable number of patents that come out on tangible, real, processes (such as chemical production); if the patent office was to shorten up the time scale too much, a competiting company can design and build a facility (which can take a few years) that uses a patents but turning it on the day after the patent lapses, and benefit from the findings of the other company without paying for it, which is highly uncompetitive to the entire field.

    So the time of patents does need to be shorted but not too much; 17 yrs is currently too long for the e-commerce patents, but 5 yrs is too short for process patents. Furthermore, you cannot just catagorize patents into "short term" and "long term" ones; while you could easily seperate the patents of today into those two areas, how can you know that in the next few years someone will have a patent that could fall into both because of the thinning of the real and virtual worlds? The nature of the patent should grant it no special privaleges.

    At this point I would argue 7 to 10 years for patents. It should be long enough for the patents that were truly put in place to be protected, but fast enough for the new types of patents to disappear quickly. But of course, if combine this with patent reform and a tightening of the review process, few "bogus" patents would be issued, and we would not have to wait 7 to 10 years for that bogus patent to elapse.

    --
    "Pinky, you've left the lens cap of your mind on again." - P&TB
    "I can see my house from here!" - ST:
  5. Problems with patent quota system by RyanShelswell · · Score: 2
    The suggested solution of a quote on patents issued in a time period is interesting but IMHO suffers from two major weaknesses:

    1) The solution requires that the patent office select the "best" patents. The current US patent problem is mainly due to the fact the the patent office has no clue.

    2) Say I submit an application for a patent this year and 99 have been granted already. If you're the patent office do you grant me the patent, thereby barring all further patent applications this year, or do you reject? A sensible decision would require you to know all of the patnet applications you haven't received yet. You're not going to be able to tell.

    Imagine the horror of Patent Rush on 1st January each year!

  6. For a limited time by IO+ERROR · · Score: 3

    Patents are only supposed to be good for a limited time (currently 17 years). Back in the indudstrial age, you needed that time for basic R&D and getting your product to market. By the time you got your product out and in use by people, the patent would be close to expiring. These days the product development timeframe is much shorter, especially with software. Any changes in patents should reflect this.
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    How am I supposed to fit a pithy, relevant quote into 120 characters?
  7. Patents = funding model by speek · · Score: 3

    I have said this before on Slashdot, but I'll say it again. The patent system is a funding model - a way of funnelling money for the purpose of scientific research.

    There are many possible ways of funding research - public money, charity-type organizations, etc. However, the patent system overwhelms other funding models we might try because it creates the potential for such astronomical returns on investment. Other models can't compete.

    Here is my alternative: set up a patent tax. It works just like a national sales tax. Any product that makes use of a patent has the patent tax applied to it. the proceeds from the patent tax go to the holder of the patent. In addition, NO ONE is restricted in any way from using patent technology. The patent tax could vary with each patent - that's detail that could be worked out in interesting ways.

    I'll give an example of how this works - take the Amazon 1-click patent. If Amazon patents this under this patent tax, then any user who choses to use 1-click must pay the patent tax, whereas if they choose to order normally, they wouldn't. You can see how easily the market would determine the value of this patent - nobody would do it. The only thing Amazon has succeeded in doing by patenting 1-click is ensuring that no one will use 1-click. So, they probably would not have made such a ridiculous patent under this system.

    Another example: Someone invents a pill that cures breast cancer. They patent the pill. Now, any company can manufacture the pill and sell it, so it's likely to be cheap, right off the bat, but there's the patent tax, of, say 100%. So, the patent holder makes a lot of money - even though others are allowed to sell their product. It probably makes economic sense for the patent holder NOT to make their own product, as they would make as much money off of others, without having to be a manufacturer.

    In any case, I think we could get rid of patents, and we'd, as a society, just have to come up with different funding models. I think we could do that.

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    First, make it work, then make it right, then make it fast, then, make it bloated!
    1. Re:Patents = funding model by speek · · Score: 2

      The license fee model is at the sole discretion of the patent holder. They don't have to license their technology. That stifles other companies who may want to use it. My system places no restrictions on anyone. The only affect a patent has is that the end product is subject to the tax.

      Regarding bureaucracies - millions of lawyers and courts doesn't at all strike me as being efficient. A national patent sales tax could easily be implemented relatively efficiently, especially given our level of technology these days.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    2. Re:Patents = funding model by speek · · Score: 2

      Well, this is just dumb. The tax would only affect those who use the patented 1-click. So, if Amazon forced everyone to use 1-click, people would move to their competitors, and avoid the tax. Or, if Amazon offered other methods in addition to 1-click, people would use those methods, and avoid the tax. The patent would be worthless.

      And, by the way, you can't "pass on" the cost of a sales tax! Think about it.

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      First, make it work, then make it right, then make it fast, then, make it bloated!
    3. Re:Patents = funding model by speek · · Score: 2

      It's similar to compulsory licensing, but superior, I think. How do you force licensing? Are you going to have a government tell the company how much to license for when the two companies involved can't agree? Also, you have to make all those license agreements in the first place - a lot of unnecessary effort and bureaucracy, in my opinion. Under my system, the patent application is also the license agreement. The tax settles the amount - it's always royalty based (in effect), and the actual tax percentage can be determined by the patent holder, with some simple limitations set by the government. It just seems much simpler, to me.

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      First, make it work, then make it right, then make it fast, then, make it bloated!
    4. Re:Patents = funding model by speek · · Score: 2

      How is sales tax theft? It's cost, that you see up front and agree to pay. Or not. It's up to you. It's a way of funding research. It would be nice if research were cheap and risk-free, as you seem to think it is, but it's not. It involves hard work, and putting yourself at risk to lose a lot. It requires reward as an incentive. If we had a gift economy, maybe your way would work, but we don't. I see my plan as moving in that direction, though, since it removes restrictions on what others can do with your invention.

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      First, make it work, then make it right, then make it fast, then, make it bloated!
    5. Re:Patents = funding model by speek · · Score: 2

      Could you expand on why you think it would be a big mess? I realize my plan allows for all different percentages to be applied for tax, and a product could come under multiple patent taxes. But, I think that with computer technology today, this is very doable. It requires that we choose to do it only (which I know very well will not happen).

      Anyway, if the end product is free, then a percentage of that is 0, right? So, I don't understand your example with Windows. If a free product uses a windows patent, you don't pay a tax based on the cost of windows, you pay a tax based on the cost of the product, which was free. This would essentially make software patents useless, which is good.

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      First, make it work, then make it right, then make it fast, then, make it bloated!
    6. Re:Patents = funding model by speek · · Score: 2

      You can probably guess, I'm not trying to come up with a system that has a chance of being adopted, I'm trying to come up with the best solution I can for the overall problem.

      To respond, I don't think free software should have to pay for patents, if the cost is 0, and I don't see that as a problem. Software has only recently become patentable, and I think it's a crock.

      Secondly, your system of compulsory licensing - I had thought about that, but when push comes to shove, and you have to enforce that, what price to you make the patent holder "accept" for their patent? Who determines the value? The government?

      I'd rather that price be set in a more natural, market oriented way. Which is why I came up with this. Besides, the tax way, the licensing is taken care of for everyone - not just those who sign a licensing agreement.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
  8. Are patents *in general* a bad idea? by dlc · · Score: 3

    We, as a community, tend to look at "patent" and see "software patent." A better question, when we talk about patent reform, is whether patents work in general. Yeah, they tend to be a bad idea when it comes to software, but in general, are they a bad idea?

    We, as a community, need to take off the rose-colored Open Source glasses, and look at patents in a broader scope. Most of the patents that are issued every year have nothing to do with software. Many of them are not even related to technology. Before we start "reforming" patent law, maybe we should look at other areas that have a lot of patent activity.

    I don't intend this as a flame! We hear about software patents all the time but there is definitely more to the patent picture.

    darren


    Cthulhu for President!
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    (darren)
  9. Welfare for Lawyers by StormyMonday · · Score: 2

    Lawyers write the laws. Admittedly, there are areas that are much worse than patents (take a look at the tax laws sometime), but patents are pretty bad.

    That said, the biggest problem with the patent system seems to be the extreme overload of the system from gazillions of applications, plus the lack of patent examiners who are remotely familiar with the fields they're working with. "Prior art" nowadays seems to mean looking in the patent system database and nowhere else.

    We definately need some new laws to tighten up the requirements for "novelty" and "usefulness". We also need a way of getting the real experts in the fields involved to look at patent applications. Could an "open source" arrangement work? Publish applications on the Web and let everybody make comments? (I rather suspect not; there are just too many applications.)

    One reform that the US patent system needs is to move from the "first to invent" system used only in the US to the "first to file" system used everywhere else. "First to file" is trivial to determine -- just look at the postmark on the application. "First to invent" is just another playground for lawyers.

    Another reform would be to tighten up the time between publication of an idea and filing for a patent. This is one of the problems with the LZW patents used in GIFs. Unisys filed the patent well after the article describing LZW compression was published. None of the authors of the paper, BTW, had any connection with Unisys. At the very least, any publication of the idea should contain an "intent to file" statement.

    But it won't happen. The lawyers in Congress aren't going to do anything that would cut down on their colleagues' incomes, and the Big Money likes things confusing. Neither Congress nor Big Business cares squat about "promoting the progress of science and useful arts".

    --
    Welcome to the Turing Tarpit, where everything is possible but nothing interesting is easy.
    1. Re:Welfare for Lawyers by jms · · Score: 2

      I suspect that public disclosure and comment on patent applications would work very well and would go an especially long way towards alleviating the software patent problem. Right now, a patent examiner picks up a new patent application, and researches the prior art. The examiner may not be familiar with the prior art. However, if that application was posted on the USPTOs web site for six months, and received even one comment from the public that cited invalidating prior art, the job of the examiner is essentially done, and more time can be spent on truly original patent applications, for which no one can produce prior art, and are perhaps more deserving of patent protection.

      The current system of patent secrecy encourages the filing of questionable patents. A company has nothing to lose besides the costs of preparing and filing the patent. If the patent is granted, the company obtains a monopoly. If the patent is not granted, the application is not disclosed, and the company retains the trade secret status on their idea.

      A system where patent applications were disclosed would deter companies from filing these "trial balloon" patents. A company would have to make the hard decision whether to give up their trade secret in exchange for a chance at a patent. Instead of just writing up a patent application and filing it, a smart company would perform a prior art search first, and if obvious prior art came up, they would not file for the patent, figuring that if they found the prior art, someone else probably will too. This would reduce the number of trivial patent applications, and reduce the USPTO's work load.

      I think that there is a strong public interest in studying pending patents. I believe that both companies and the general public would participate in such a system. Companies would participate both to keep up with the state of the art, and in order to prevent their own publically disclosed, non-patented inventions from being patented by rivals, and individuals would participate because studying patents is educational and interesting, and an excellent way to keep current with the state of the art in one's fields of interest.

      I would support the idea

  10. patent "problem" is part of something much bigger by ATKeiper · · Score: 5
    There are lots of patent controversies right now, most notoriously problems relating to software business-method (bizmeth) patents, and patents on parts of the human genome.

    But these problems should be seen as part of a larger challenge facing intellectual property protections. The Napster and DMCA and DeCSS problems are all related to copyright - another form of intellectual property protection, which is challenged by our new information technologies' ease of dissemination.

    Some people have called for major revisions to our copyright laws, and others (like Jeff Bezos and the people in the introduction above) have suggested that the patent system should face strict reforms.

    These are sometimes extremely good suggestions, but we would do well to keep in mind the following:

    • 1. The battles over intellectual property protection have been at least this
    • intense before (even if patent applications have not be so prolific before), and the system survived.

      2. We cannot just tinker with these systems, but must treat them with profound respect (even if they are broken) because huge amounts of money and acclaim could end up going to people who don't deserve them, while innovators who do deserve them could get screwed.

      3. If we think of copyright and patent problems as parts of a larger set of intellectual property issues that need consideration, it will actually help avoid confusion -- and we will be more likely to convince others (read: legislators) that these issues deserve attention.

    For more background on the patent problem, see James Gleick's superb piece, Patently Absurd (NY Times, 12 Mar 00).

    A. Keiper
    The Center for the Study of Technology and Society
    Washington, D.C.

  11. Re:Why? by radja · · Score: 2

    ah.. the joys of moderation...strange though how unrated things can be overrated..

    //rdj

    --

    No one can understand the truth until he drinks of coffee's frothy goodness.
    --Sheikh Abd-Al-Kadir, 1587
  12. ... the time IS a problem by redelm · · Score: 2

    Building on this, technological development has had other effects.

    As noted, communications developments from the telegraph onwards have greatly accelerated the flow of information. This permits much quicker commercial exploitation of novel ideas and products.

    But there are other changes. The market is much larger, increasing the rewards of new ideas. There are also many more potential inventors, so the cost of "first to file" is much higher. The likelihood that something would remain uninvented with weaker patents is much lower. Even 5 years is not likely to slow innovation. It would slow filings.

    This applies in most areas, but not all. Pharmaceuticals are extremely expensive to develop, and slow to market due to government action (FDA). Some process patents (Unipol for plastics) take a long time (3 years) to build a plant, and need some time to pay back. 17 years might remain apporpriate for them.

  13. Question by donny · · Score: 2

    If Congress (through the delagation of powers to the Patent Office) allows patents to be granted that promote neither science nor useful arts, wouldn't this be unconstitutional? (i.e., a case of the Patent Office abusing its powers)

    If a corporation uses its patents solely for the purposes of bullying other people and corporations around, wouldn't that be evidence of the non-positive nature of the patent?

    I'm sure that LZW compression (of GIF fame) would have been invented whether or not the incentive of temporary monolopy was present. (The remainder of the GIF spec cannot possibly be considered innovative by even the daftest of morons. If anything, animated GIFs are the scourge of the bandwidth-challenged.)

    Donny

  14. Measure patents and copyrights in net years by Greyfox · · Score: 2

    17 years for patents in this rapidly evolving industry is way too long. Why not measure them in net-years. A patent could last 3-5 years and copyrights could last 10 to 20. Companies would still make back their investments if they use their patents correctly and we'd see much less of the patent cruft that's currently building up.

    --

    I'm trying to teach myself to set people on fire with my mind... Is it hot in here?

  15. Get with the program! by bhurt · · Score: 2

    Attempting to base modern society off of 18th century pre-industrial laws is like _so_ dated it's carbon dated! This is the new economy, baby- with the new rules to match! Talking about fusty old documents like that is even funnier than trying to apply 19th century antitrust laws to modern info e-dot-commerce company! Like, get real!

    Patents are the modern, high tech way to deal with monopolies- make everyone a monopoly! For example, I myself have patented the word "the"- and am rolling out plans to charge a $3 licensing fee for every use of the word the. You may even have heard about my forth comming IPO- the dot com. "It's _the_ place to invest!" It'll be the biggest IPO to hit since Redhat's prehistoric IPO! It'll make billions! It'll make Sagans! (Billyuns and Billyuns)

    And any insinuation that I, rightfull patent holder of the word the, might not be in the best interest of the society as a whole, is obviously instigating a communist plot to topple the markets, bankrupt millions of daytraders, encourage the illegal international piracy of the word the, cast the whole of civilization down into the depths of dispare and poverty and maybe even rend the fabric of this most noble country called The(tm) United States of America. For beautiful and sacred lies, for never ending gain... Opps, sorry, little flash back there.

    Where was I? Oh, yeah, Natalie Portman- Naked and Petrified...

  16. The other side of the coin by Kagato · · Score: 3

    One of my co-workers points out that with out patents there is no driving force for research. At least for the little guy. Joe Blow working out of his basement creates an invention, only to find that three months later megacorp is producing his product. Joe Blow gets screwed. ...Of cource my co-worker also thinks Microsoft deserves to have have it's Monopoly, so take it with a grain of salt.

    I will point out that even in our current system the megacorp will always win. I've personally worked at smaller companies that have had valid patents that were infrindged on by very large companies. All that happens is a bunch of lawyers sit in a meeting room and basically say "Yeah, we're pissing on your Patents, but we've looked at your finacials and you do not have the backing to sue us. Don't let the door hit you in the ass on the way out."

    When you are a large company and have lawyers on staff it isn't hard to wage a patent war. If you're a small company you will be sucked dry by the lawyers.

    It doesn't matter if you scrap the current system or keep using it. Money speaks in judicial system.

  17. Original Patent System by Robert+Wilde · · Score: 3

    It is worth pointing out that the current patent and copyright system bares almost no resemblence to that which existed after the founding of the Republic.

    In the 1700s, only a handful of patents were granted each year. The bestowing of a government monopoly was considered such an exceptional event that the Secretary of State personally approved each patent application.

    As well, copyrights lasted for a relatively brief period of time, had to be registered by depositing an archival copy of the work, and had to be renewed or the copyright would expire.

  18. Copyright by cfulmer · · Score: 2

    So, it seems to me that there's a actually a good argument in the text of the constitution to say that the Congress' retroactive extending of copyright is unconstitutional. Last year, in the "Sonny Bono Copyright Act," Congress extended copyright to 95(!!) years, primarily in response to lobbying from Disney and other media companies.

    The problem is that extending copyright retroactively doesn't encourage the arts -- the work has already been produced, quite often by somebody who is already dead! And, since the constitution allows Congress to institute copyright to encourage the arts, retroactive copyright extension doesn't do it.

    Important for things like project Gutenburg.

  19. Theory vs Reality. by FallLine · · Score: 3

    Your plan, like many, sounds fine in theory. The inventors get "rewarded" for their efforts. Whoopie. However, you are ignoring the very important relationship of risk and return. Just because you provide "some return" to the risk taker, the inventor, does not mean he will continue to take risk. These so-called monopolies happen to be a very efficient way to provide a high degree of return. Perhaps it is sometimes too high, but to propose that the government sets what is "fair" begs for the creation of a far less efficient system.

    Furthermore, the mere fact that the government grants a "monopoly" on the idea for 17 years, does not mean the holder enjoys any such protection. In the vast majority of cases, competitors come out with equivelent products without having to go through the patent. So, if the effective life of the patent is only 5 years (actually quite high in many areas), it is all that much more important that the inventor ramp up his profits at the outset. To provide a smooth (or flat) "patent tax" tax, or one that is set arbitrarily by the government, might prove harmfull in two ways. If reward (read: tax x usage) are too low at the outset, this will lower the incentive for the inventor. Second, if it is too low, it may discourage the competing companies from trying to come up with unique alternative solutions of their own. Instead, they just "license" it as your "reasonable" fee. All in all, it would create a pretty apathetic system...perhaps not quite as bad as no IP, but significantly worse than what we have now.

    In closing, the patent system is more necessary than it ever was. Sure, there are some abuses, but it is blown out of proportion by slashdot users. Slashdot confuses the mere existence of a patent, with the ability to profit and enjoy that protection. The patent office has been flawed for years, but the test is not the patent office, it is the courts. In other words, the granting of a patent does not mean it holds up in the real world, so to blow a few odd patents up as proof that "innovation" is now impossible is simply not true. [Yes, I agree the patent office has serious flaws, ...but many proposals are unrealistic. There is always going to be disagreements and flaws in any system you create, that is human nature...] Many slashdot users simply fail to understand that not everything can be created like Linux (e.g., people working part-time in ragtag fashion). They seem to think that some panel of "experts", is a better decider of "value" than the market. Yet, if you talk to most any proven entreprenuer/inventor, they scoff at the idea of academics deciding value.... I've known numerous entreprenuers with proven track records to go in front of these "alternative sources of financing" boards (e.g., NIH, NSF, etc.) with great and truely usefull ideas, only to be rejected [or given peanuts] (not even for financial reasons, the money went to far less worthy projects)...only to be ultimately proven right. Lastly, one need look no further than the massive amounts spent by large and small companies alike to conclude that the _actual_ IP system works decently.

    1. Re:Theory vs Reality. by speek · · Score: 2


      Your plan, like many, sounds fine in theory. The inventors get "rewarded" for their efforts. Whoopie. However, you are ignoring the very important relationship of risk and return.

      Currently, the reward a company gets is market driven - via a government protected monopoly. A patent tax is no less market driven - how much "reward" you get is based on the demand for the product and the tax level assigned to the patent. The more people want the product, the more revenue the tax will generate. So, I can't agree with your assessment that the tax plan here. You assert the monopolies is a very efficient way to provide a high degree of return. I'm not interested in providing high degrees - I'm interested in providing a return based on the market value of the patent.

      ...but to propose that the government sets what is "fair" begs for the creation of a far less efficient system.

      Your assuming the current system doesn't get "set" by the gov.? How do you control the cost a monopoly charges for a needed product? Say, a product that saves people's lives? What's to stop them from charging an infinite price? Insurance companies and government. A tax system that I'm suggesting could give the patent holders the choice of tax rate they want applied to their patent. The government might simply set some limits on that tax rate.

      In the vast majority of cases, competitors come out with equivelent products without having to go through the patent
      So, the patent is effectively worthless. No different in my system. Probably the patent holder would choose to "drop" their patent, or the tax rate.

      If reward (read: tax x usage) are too low at the outset, this will lower the incentive for the inventor
      I suggest the inventor set the tax rate, so it's as high or low as they choose/need.

      Second, if it[the tax] is too low, it may discourage the competing companies from trying to come up with unique alternative solutions of their own. Instead, they just "license" it as your "reasonable" fee.
      Hmmm, interesting fear. I'm not sure I'd be worried about this. It would thus encourage the sharing of technology and knowledge, and would still provide substantial benefit to innovation.

      They seem to think that some panel of "experts", is a better decider of "value" than the market. Yet, if you talk to most any proven entreprenuer/inventor, they scoff at the idea of academics deciding value
      Yes! Let the market decide - not "experts", not academics, and not a monopoly!

      . Lastly, one need look no further than the massive amounts spent by large and small companies alike to conclude that the _actual_ IP system works decently
      One should also keep in mind the number of technologies left to languish under patent protection, and the number of technologies left to languish because there's no way to recoup the research costs. There are illnesses they know how to cure, but don't because it would cost a lot, and only 500 people a year die from them, so, why bother? The system we have is not efficient, and there's nothing wrong with developing new ways of dealing with the problem. My ideal is that there'd be multiple funding models in place, but the current patent system really discourages people from using other models.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    2. Re:Theory vs Reality. by speek · · Score: 2

      Just for you....

      BTW, if preview wasn't buggy, maybe I'd actually use it. As it is, it strips out all HTML from my post.

      Your plan, like many, sounds fine in theory. The inventors get "rewarded" for their efforts. Whoopie. However, you are ignoring the very important relationship of risk and return.

      Currently, the reward a company gets is market driven - via a government protected monopoly. A patent tax is no less market driven - how much "reward" you get is based on the demand for the product and the tax level assigned to the patent. The more people want the product, the more revenue the tax will generate. So, I can't agree with your assessment that the tax plan here. You assert the monopolies is a very efficient way to provide a high degree of return. I'm not interested in providing high degrees - I'm interested in providing a return based on the market value of the patent.

      ...but to propose that the government sets what is "fair" begs for the creation of a far less efficient system.

      Your assuming the current system doesn't get "set" by the gov.? How do you control the cost a monopoly charges for a needed product? Say, a product that saves people's lives? What's to stop them from charging an infinite price? Insurance companies and government. A tax system that I'm suggesting could give the patent holders the choice of tax rate they want applied to their patent. The government might simply set some limits on that tax rate.

      In the vast majority of cases, competitors come out with equivelent products without having to go through the patent
      So, the patent is effectively worthless. No different in my system. Probably the patent holder would choose to "drop" their patent, or the tax rate.

      If reward (read: tax x usage) are too low at the outset, this will lower the incentive for the inventor
      I suggest the inventor set the tax rate, so it's as high or low as they choose/need.

      Second, if it[the tax] is too low, it may discourage the competing companies from trying to come up with unique alternative solutions of their own. Instead, they just "license" it as your "reasonable" fee.
      Hmmm, interesting fear. I'm not sure I'd be worried about this. It would thus encourage the sharing of technology and knowledge, and would still provide substantial benefit to innovation.

      They seem to think that some panel of "experts", is a better decider of "value" than the market. Yet, if you talk to most any proven entreprenuer/inventor, they scoff at the idea of academics deciding value
      Yes! Let the market decide - not "experts", not academics, and not a monopoly!

      Lastly, one need look no further than the massive amounts spent by large and small companies alike to conclude that the _actual_ IP system works decently
      One should also keep in mind the number of technologies left to languish under patent protection, and the number of technologies left to languish because there's no way to recoup the research costs. There are illnesses they know how to cure, but don't because it would cost a lot, and only 500 people a year die from them, so, why bother? The system we have is not efficient, and there's nothing wrong with developing new ways of dealing with the problem. My ideal is that there'd be multiple funding models in place, but the current patent system really discourages people from using other models.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    3. Re:Theory vs Reality. by FallLine · · Score: 2
      The more people want the product, the more revenue the tax will generate.

      Perhaps, but if the rate is set arbitrarily, it may (and probably would) be less than what the risk takers currently make, so you're less apt to see investment like that.

      I'm not interested in providing high degrees - I'm interested in providing a return based on the market value of the patent.

      You might not be interested in it, but you can be sure the risk takers are. There are many fields where even with today's "monopolies" they hardly break even on R&D. The more you cut potential reward, the less profitable you make it, the more you increase the aggregate risk. Do not forget that these inventors rely on external capital. So even if one sucessfull firm returns 10x what was invested, the outside investors need atleast that to break even on expected value, because they investors aren't necessarily able to improve their odds--they don't know who the winners are going to be. This is especially true with bio and med tech firms.

      Your assuming the current system doesn't get "set" by the gov.? How do you control the cost a monopoly charges for a needed product? Say, a product that saves people's lives? What's to stop them from charging an infinite price? Insurance companies and government. A tax system that I'm suggesting could give the patent holders the choice of tax rate they want applied to their patent. The government might simply set some limits on that tax rate.

      First off, most patents aren't this "necessary". There are normally other alternatives available. Second, empirically speaking, there is simply no evidence of this. Hundreds of life saving inventions have been invented in the US alone, and not one case. Third, the companies only want to maximize profits, the maximum price is not the way to go about this. Fourth, the law can always intervene in truely extreme cases. Fifth, these limits are extremely dangerous for previously mentioned reasons (e.g., risk and return). It may be better from a utilitarian perspective to allow a couple people to die as the result of economic concerns, if the alternative is killing the thing that is saving even more lives.

      So, the patent is effectively worthless. No different in my system. Probably the patent holder would choose to "drop" their patent, or the tax rate.

      Not worthless, just the effective life of most patents is not nearly as long as most slashdot juniors believe.

      I suggest the inventor set the tax rate, so it's as high or low as they choose/need.

      If the inventor sets the rate, it would be the same as today's system for all intents and purposes. Companies license their technology ALL the time. In fact, unlike you alluded to, few companies will sit on patents which are worthwhile. If they can't make use of them, they'll generally sell or license them. There is a market for them.

      Hmmm, interesting fear. I'm not sure I'd be worried about this. It would thus encourage the sharing of technology and knowledge, and would still provide substantial benefit to innovation.

      If a company cannot gain a competetive advantage by spending millions of dollars on R&D, they simply won't. Your system might allow already existing technology to be commercially shared, but that does not mean future technology will come out (and thus will not be shared at all).

      Yes! Let the market decide - not "experts", not academics, and not a monopoly!

      What market?!?! If the inventors determine their percentages, it might as well be today's system. If not, then you're depending on a more arbitrary system to determine how much is "fair". What a "good" technology is. You come to depend on a bunch of academics who decide what to do..

      One should also keep in mind the number of technologies left to languish under patent protection, and the number of technologies left to languish because there's no way to recoup the research costs. There are illnesses they know how to cure, but don't because it would cost a lot, and only 500 people a year die from them, so, why bother? The system we have is not efficient, and there's nothing wrong with developing new ways of dealing with the problem. My ideal is that there'd be multiple funding models in place, but the current patent system really discourages people from using other models.

      The system is efficient. There has never been a time in history, or a place, which pars the level of effort or result into developing technologies. The technologies that "languish" are generally obselete and worthless. Any decently managed company which is aware of any usefull technology would sell it or use it if they thought it was dooable. Lastly, look at the profitability of almost any of these companies. You can claim they have monopolies all you want, but on the aggregate none of them are making a killing. R&D is very very expensive and risky. I can't stress this enough.

      ...What "multiple funding models"? Sounds like abstract and poorly developed concept.....

      anyhow, office is shutting down...apologies in advance for spelling, gramatical, typos, html, etc. errors.

    4. Re:Theory vs Reality. by speek · · Score: 2
      1. I have clearly said many times that, in my opinion, the patent holder would set the tax rate, so you can end the arguments saying that my system has the government or some academic set the "value" of a patent.
      2. If the inventors determine their percentages, it might as well be today's system
        Uh, no. It'd be quite different. Or are you telling me your railing against my idea so strongly, but really, it's no different from the current system which you apparently view as perfect?

      3. Other funding models - public funds, private fund-raising organizations for example. They exist today, but are a pretty small percentage of the spending.

      4. Companies license their technology ALL the time
        I suppose this goes hand in hand with your assertion about the efficiency of the current system. And abuses of the system don't happen. Patent lawsuits really aren't happening.

      5. The tax system wouldn't bring enough reward for the risk. Here's your only argument of substance, and I'll grant it's a possibility. However, I think it's more likely that the tax system could bring in even more money for patent holders. Since everyone could make the patented products, the market would drive down the base price. The tax then makes up the "research" cost of the product. If the tax is set right, it is the same effect as the monopoly setting the price right for maximum profits. However, the advantage for the tax system is that patented technology is completely unrestricted in use by others (no need for licensing approval, no way for patent holder to play favorites), and the value of patents varies tremendously - a fact that is inadequately accounted for by the current system, but which is handled pretty elegantly by the tax idea.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    5. Re:Theory vs Reality. by FallLine · · Score: 2
      I have clearly said many times that, in my opinion, the patent holder would set the tax rate, so you can end the arguments saying that my system has the government or some academic set the "value" of a patent

      The problem is that your assertion that your "system" would necessarily solve issues such as overpriced medicine is utterly incoherant with the above. If it is entirely up to the owner, they can price it prohibitively high. In other words, companies that don't want to share, won't. Companies that do, will. This is how it is today, the same for all intents and purposes. The only other alternative is to formally administrate, with academic types, who don't know the first thing about business.
      Uh, no. It'd be quite different. Or are you telling me your railing against my idea so strongly, but really, it's no different from the current system which you apparently view as perfect?

      Read above, goes hand in hand with it.
      Other funding models - public funds, private fund-raising organizations for example. They exist today, but are a pretty small percentage of the spending

      Having been behind many sucessfull high tech companies, I can tell you that the vast majority of these "alternative" (read: non-profit) models are a joke. They are run by academics almost by definition. This is not a market based system, it's nearer to central planning (read: communism). In addition, these organization are almost by definition going to have burn through money like nothing else. Who is going to foot the bill? Right now, you have a few organizations which can scrounge up a little change (e.g., the NIH, NSF, NASA, ADA, AMA, etc.) But this system would not work on a large scale, a little charity here and there does not fuel our economy. It would require serious tax dollars. Not that i'm entirely opposed to government investment, but generally speaking I think it's not a replacement for genuine capitalist motivations for investment (read: de-centralized).
      I suppose this goes hand in hand with your assertion about the efficiency of the current system. And abuses of the system don't happen. Patent lawsuits really aren't happening

      Umm, no. The patent office has serious flaws. They could be improved somewhat. But it is the courts where the power truely lies, the patent office has always operated as more of a filling service than anything out (granted, they do some filtering, but not much more). I do not envision anyway to really change this all that much for the better. Many of these legal fights are inevitable, even necessary. Assuming you could ever hire the "best" people to be patent examiners, there is no way you can insure that they are honest or accurate. Intellectual property protection is by its very nature highly complex. It's really not cut out for one guy to summarily grant or dismiss everything...thus we rely on the courts. I don't think it's "perfect", but I don't see a more optimal solution...certainly not yours.

      The tax system wouldn't bring enough reward for the risk. Here's your only argument of substance, and I'll grant it's a possibility. However, I think it's more likely that the tax system could bring in even more money for patent holders. Since everyone could make the patented products, the market would drive down the base price. The tax then makes up the "research" cost of the product. If the tax is set right, it is the same effect as the monopoly setting the price right for maximum profits. However, the advantage for the tax system is that patented technology is completely unrestricted in use by others (no need for licensing approval, no way for patent holder to play favorites), and the value of patents varies tremendously - a fact that is inadequately accounted for by the current system, but which is handled pretty elegantly by the tax idea

      I don't think risk and reward can be understated. Since you are making noise about reducing "costs" or "profits", the curbing of rewards, and hence reducation innovation cannot be ignored. I don't see way how this system could drive down the base price significantly, while allowing innovation to remain constant (read: preserving rewards). The costs in most of these products involve the R&D costs, the initial outlays, marketing, etc.... Where you see increased costs is where companies will charge a premium for a new product...which is part of their reward....which is what you say you're going to try preserve.

    6. Re:Theory vs Reality. by speek · · Score: 2
      I'm going to distill this argument because I don't feel you're responding to my central points.

      If the tax system is unrestricted, then you argue that it's the same as we have now, and costs would not be any better than they are now. Here are my two main points:

      1. The advantage for the tax system is that patented technology is completely unrestricted in use by others.
        Thus, one of our complaints is resolved - the technology is allowed to flourish and be used freely. Under the current system, it's common for a few licenses to be signed, and everyone else locked out. Or, in the case of medicine, for a monopoly to be held as long as possible.

      2. The value of patents varies tremendously.
        Those patents that deserve maximum compensation and reward can still get it. Those patents that are worth a small amount get that. And those that are worthless, like the 1-click, really would be worthless.



      I believe these are our main complaints about patents - the restrictive nature of them, and that even silly things can be patented and enforced.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    7. Re:Theory vs Reality. by FallLine · · Score: 2
      The advantage for the tax system is that patented technology is completely unrestricted in use by others. Thus, one of our complaints is resolved - the technology is allowed to flourish and be used freely. Under the current system, it's common for a few licenses to be signed, and everyone else locked out. Or, in the case of medicine, for a monopoly to be held as long as possible.

      I would hardly say a system which is burdened with the same or more economic bagage than today is "unrestricted." The "sharing" you discuss would be heavily contigent on the "tax" the inventor sets. So it is not as if alternative companies could cherry pick the best patents and idea. For instance, if I spend 500m inventing an artificial pancreas, and I know the market for my product is only so big (e.g., diabetics), and that my patent is not going to be worth much in 2 years, I would be sure to set my per unit tax up such that I collect atleast 2000 dollars on every sale. Thus, when the competition comes along, they have variable costs of atleast 2000 dollars plus materials and labor, not to mention the fixed costs of setting up a plant, buying the machinery, etc. So what we have in a product that sells for at least 6000 dollars, quite possibly more expensive (because I set the tax) than my operation. What little other benefit provided to the consumer through "sharing" is soon lost too. If the competition wishes to add other IP protected features from other companies, say, a 10 year life battery, they're going to have to pay, say, 4000 here....so this mixing, matching, and building upon other things quickly can become prohibitably expensive.

      The value of patents varies tremendously. Those patents that deserve maximum compensation and reward can still get it. Those patents that are worth a small amount get that. And those that are worthless, like the 1-click, really would be worthless.

      That is non sequitur. Amazon, under your system, is still entitled to charge whatever they please. So long as they hold the one-click patent, and it holds up in court (which I doubt it will today), they could charge all of their competitors a fee which would allow them to charge less than the competition. The competitors who wish to use the technology still must pay whatever Amazon desires, just like today (again, assuming the courts support amazon which I doubt). Amazon's theoretical patent protection is worth quite a bit in actuality, but they did not create this value. Your system simply doesn't fix this.

      Furthermore, your statement that the return of a patent would be contingent on its value is meaningless. Holding a patent today, in and of, itself does not bring the inventor any return. People must buy or utilize the patent in order to have any hope of return. Thus, worthless patents are worthless. Worthwhile patents are worth a lot. Your system does not change this.
    8. Re:Theory vs Reality. by speek · · Score: 2

      That is non sequitur. Amazon, under your system, is still entitled to charge whatever they please

      I disagree. I don't think you've thought it through. If Amazon patents the 1-click under the tax idea, and applies, say, a 5% tax on it. Competitors will simply opt not to use it, because end users will opt not to pay it. End users will simply decide, "well, if I use the slightly longer method to buy my products, I avoid this stupid 5% tax", and thus, the users have determined the "value" of the patent. Amazon would have to drop the tax to nothing basically for something so useless. As it is now, other companies can opt not to use the 1-click, but it may put them at a disadvantage, or they can fight a big huge expensive very inefficient court battle, and maybe win, maybe lose.

      Your pancreas example seems flawed.

      For instance, if I spend 500m inventing an artificial pancreas, and I know the market for my product is only so big (e.g., diabetics), and that my patent is not going to be worth much in 2 years, I would be sure to set my per unit tax up such that I collect atleast 2000 dollars on every sale. Thus, when the competition comes along, they have variable costs of atleast 2000 dollars plus materials and labor, not to mention the fixed costs of setting up a plant, buying the machinery, etc. So what we have in a product that sells for at least 6000 dollars, quite possibly more expensive (because I set the tax) than my operation

      The cost for anyone to manufacture the pancreas is essentially the same. Normally, if you had a monopoly, you'd set the price to say $2000 above cost. So, the end price comes to $6000, as in your example, but the manufacturing cost was only $4000. You're making a 33% profit. If you set up a 33% tax under my system, others can then manufacture and sell the pancreas at a base price of their choosing, and you get 33% extra from each sale. If someone out there develops better manufacturing techniques than you, then we have some savings.

      And I disagree the tax system would necessarily be burdensome. It would take some clever programming to make a system that runs smoothly, but I would take full advantage of large, powerful databases and the internet to store all the information and make it easily retrievable, so that costs and tax per product can be looked up and found very easily by retailers.

      Thus, worthless patents are worthless. Worthwhile patents are worth a lot. Your system does not change this.
      It would appear that most companies think all patents are worthwhile, since they don't hesitate to patent anything and everything they can think of. Given my Amazon example, I think my system would discourage frivolous patents.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
    9. Re:Theory vs Reality. by FallLine · · Score: 2
      I disagree. I don't think you've thought it through. If Amazon patents the 1-click under the tax idea, and applies, say, a 5% tax on it. Competitors will simply opt not to use it, because end users will opt not to pay it. End users will simply decide, "well, if I use the slightly longer method to buy my products, I avoid this stupid 5% tax", and thus, the users have determined the "value" of the patent. Amazon would have to drop the tax to nothing basically for something so useless. As it is now, other companies can opt not to use the 1-click, but it may put them at a disadvantage, or they can fight a big huge expensive very inefficient court battle, and maybe win, maybe lose.

      Your above argument is incoherant. In both the present and the proposed situation, the pricing, and thus the effective control of the usage, is entirely up to Amazon. They may or may not sell anything at the specified price, but it is the same in both situations. The only difference being that your proposal says: "You must license your technology, but you can choose the price". For all intents and purposes though, this gives Amazon the ability to stop anyone from using it. The power to determine the pricing lies in Amazon's hands in both situation. Whether the usage comes from today's licensing fees or your proposed "tax", buyers' (read: market) strength is the same.

      The cost for anyone to manufacture the pancreas is essentially the same. Normally, if you had a monopoly, you'd set the price to say $2000 above cost. So, the end price comes to $6000, as in your example, but the manufacturing cost was only $4000. You're making a 33% profit. If you set up a 33% tax under my system, others can then manufacture and sell the pancreas at a base price of their choosing, and you get 33% extra from each sale. If someone out there develops better manufacturing techniques than you, then we have some savings.

      My example, in case you did not understand, was: 2000 (monopoly rents) + 4000 (manufacturing and administrative costs) = 6000 (selling price). The point being that the power to reduce prices really does not rest in the competitions hand, as the price is mainly a function of monopoly rents, not manufacturing costs. You might have an argument that they could reduce manufacturing costs slightly, but this is nominal. In fact, I would say that the propensity of the inventing company to overcharge would more than overtake whatever savings the competitors are able to generate (almost by definition). Thus, prices would not be reduced. The pharma-company with the "life saving" medication can still determine the selling price.

      It would appear that most companies think all patents are worthwhile, since they don't hesitate to patent anything and everything they can think of. Given my Amazon example, I think my system would discourage frivolous patents.

      This doesn't follow either.

    10. Re:Theory vs Reality. by speek · · Score: 2

      I probably shouldn't respond, since it's obvious your intent is simply to disagree with everything I say, but....

      Your above argument is incoherant
      You keep saying that. Let's see you show it, in detail. To me, it's clear you aren't really thinking about my Amazon example.

      In both the present and the proposed situation, the pricing [is controlled by Amazon]
      Only the tax is controlled by Amazon...
      and thus the effective control of the usage, is entirely up to Amazon
      No, usage is not under Amazon's control. Anyone can use the 1-click, if they choose. The only condition, is that the tax is paid each time.

      They may or may not sell anything at the specified price
      There is no specified price. There is a specified Tax. There's a difference there you need to consider. Amazon can't make all their products cost the same whether or not 1-click is used. The tax only applies to 1-click, and so it boosts the price after the price of the item is determined. Amazon could give a discount for all 1-click purchases, but then the 1-click simply has the effect of reducing their profits.

      For all intents and purposes though, this gives Amazon the ability to stop anyone from using it. The power to determine the pricing lies in Amazon's hands in both situation
      Not pricing - tax! Again, think about the difference. Amazon can, in practice, stop anyone from using 1-click, by assigning a tax of 50% to it (no user would ever use it, so no retailer would use it). But, Amazon also would not be able to use the technology, since the tax would apply to them as well, and the users would simply bypass the 1-click, or go elsewhere if you were forced to use 1-click at Amazon's site. So, yes, Amazon could patent it and put the tax ridiculously high, and no one could use it. But Amazon would also get no benefit, and they would, without doubt, bow to public pressure to remove or reduce the tax rate in such a situation.

      My example, in case you did not understand, was: 2000 (monopoly rents) + 4000 (manufacturing and administrative costs) = 6000 (selling price). The point being that the power to reduce prices really does not rest in the competitions hand, as the price is mainly a function of monopoly rents, not manufacturing costs.
      Do you not really read stuff I'm writing? It seems obvious that I understood your breakdown of 2000 and 4000. It also is clear you're still talking about price, and not understanding the concept of tax. A tax is a percentage. Their is no fixed $2000 price. I translated this to a tax rate of 33% in my reworking of your example. This seems to make it clear that competitors have a great deal of control over the final cost of the product. A 50% reduction in the base manufacturing price ($4000 reduced to $2000), reduces the final cost to $2666, less than half the original $6000.

      The pharma-company with the "life saving" medication can still determine the selling price.
      Yeah, basically, they can. Minor manufacturing cost savings could result, but overall, the pharmaceuticals are going to be good at predicting likely prices and at fixing a tax rate to their benefit. So? You like the present tax system for pharms-companies, and my system doesn't seem to harm their chances. That's a good thing. But it does make tech open. It forces patents to truly be worthwhile to the end user. And, it would avoid a lot of costly, inefficient court battles.

      --
      First, make it work, then make it right, then make it fast, then, make it bloated!
  20. Re:public domain by Masem · · Score: 2

    In my plant case, it was using the assumption that patent times were harshly shortened (as many people would want for computer patents). As it stands currently, you're absolutely right; the guy that waits 20 yrs to benefit from public domain is losing 20 years of profit. On the other hand, if patents were only 5 years, there might be an advantage to waiting to turn on the system and make money without licensing fees compared with starting right away but paying it.

    --
    "Pinky, you've left the lens cap of your mind on again." - P&TB
    "I can see my house from here!" - ST:
  21. priorart.org?? by ToLu+the+Happy+Furby · · Score: 2

    Now, I'm rabidly clueless about the requirements for something to qualify as Prior Art, so this idea could be entirely unworkable. But it's my general understanding that to invalidate a patent on grounds of prior art, you just need proof that someone thought of the idea before the person seeking the patent, not that they implemented it or even carried out the design to the degree of detail necessary to secure a patent.

    Thus, my idea is this: why don't we have a website (priorart.org?) where you can go whenever you have a cool idea that you don't have the time, money, inclination or expertise to implement, and post that idea to the public domain? That way it ought to be trivial (or as trivial as the law gets) to invalidate a patent using one of the ideas posted there: just show that the idea is the same, and that the timestamp at the website was before the date of the patent submission. By submitting your idea to the site, you'd be placing it in the public domain, but you'd have the advantage of all the other people who read the site responding to it and possibly improving on it to the point where it's actually feasible to implement. On the whole, it sounds like a way to fight the patent system that's a whole lot more broad, less time consuming and less expensive than trying to maintain a GPLed patent portfolio (although I think that's a good idea too).

    Of course (and this just demonstrates my point! Sort of.) I think there's prior art on the priorart idea. Or, at least, there are 16 websites with "priorart" in their names. priorart.org is taken, but I timed out when I tried to go there; I didn't take the time to check out all the other ones, so I dunno if they're using my idea or not.

    But it's a good idea, though, isn't it? Isn't it?? What do you guys think??

    1. Re:priorart.org?? by Doomsayer · · Score: 2

      I'm starting a prior art site; right now it's at:
      http://members.axion.net/~enrique/invention.html
      and it is a release early, release often place for ideas. Every idea which can be expressed as code is under the GPL, everything else is under the Open Content License. The bolded links are ideas which are largely complete, the rest are going to be worked on over the next few months. People are welcome to ideas, comments or requests for inventions. Posting on the message board leaves a record with a time and date to establish that the idea was developed by a certain time.

      As I've added ideas to the site, I noticed that hardware ideas can be thought up as fast as software ideas, you just can't implement most of the hardware ideas in a short time. In my opinion, the only reason to have patents on hardware inventions is so that the inventor could get the capital to bring them to market, there's no need to encourage the initial idea because that happens relatively often without financial incentive.

  22. Re:We do need patents. by mindstrm · · Score: 2

    Yes. So when the cure for aids is discovered.. the company discovering it will hold absolute and exclusive rights. Even though it is very simple to make, and there are more than enough people in the world with resources who will work together to make a supply of the drug that the world needs, the discoverer has no motivation to share.
    Rather, the *DO* have to share, but nobody else is allowed to do anything with it. They would get sued.
    Of course, I could say that as a chemist, I'm making your drug X, to save my friend's life, and if you sue me for making this compound, I will charge you with murder.

  23. Re:I swear it's true by mindstrm · · Score: 2

    Tesla died broke. and Alone.

  24. Patents and Open Source have the SAME GOAL by Krelnik · · Score: 2

    OK, I know I'm gonna get flamed big-time for this, but here goes... For the sake of my point, I am disregarding for the moment the current worst practices of patent law, such as trivial software and business method patents. I am only thinking about the theory that underlies the patent process. So please don't mention Amazon or any other current anecdotes in any flames aimed my way. Think about the theory underneath all this drek, the theory that led our founding fathers to put that clause in the Constitution in the first place. In my opinion, that theory is the same idea that underlies Open Source! If you open up technology for others to look at it, you encourage advancements that would never have happened otherwise. Clearly wonderful things like Linux could never have happened without the Open Source process. Likewise there are many inventions that have become revolutionary, and spawned many other further innovations, that would never have seen the light of day were it not for the patent process. The purpose of patent law is to act as encouragement to inventors to disclose what they have done. Without patent law in place, inventors are practically required to keep their inventions secret. If you don't, someone will steal your idea. If that someone happens to have more capital or better connections than you, you're screwed. So you keep it a trade secret and hope nobody reverse engineers what you are doing. Do I need to explain that this is a bad thing? Suppose someone invents a limitless power source that would forever solve our energy problems. Without patents, they would have to keep this a secret. Now suppose they screw up their business and go bankrupt. A priceless technology could go completely to waste, lost in the mildewing estate of a bankrupt inventor. Patents break this cycle in the same way that open source does. In fact, patents do it better than open source because they grant special rights in exchange for the disclosure. You don't get much in the way of immediate tangible benefits by open sourcing your product. But you do get an immediate, tangible benefit for a patent. By granting exclusive rights to the inventor for a limited time, patents encourage inventors to disclose what they have done. This disclosure helps other inventors innovate by adding to the published literature. And of course, once the patent expires, the invention is free for all to use, with the exact instructions on how to do so on file with the government. I find it highly ironic that some of the biggest opponents of software patents are the same folks who push open source. Because in my mind, the fundamental motivation of both of these ideas is the same thing. That is: open technology up for the good of society.

  25. Re:Some of you sound like idiots! by mindstrm · · Score: 3

    me: You see Judge.. I didn't know it was illegal! So I'm not guilty.....

    judge: ignorance is no excuse. It is every man's duty to understand and obey the law.

    me: Well judge.. let's get on with the trial.

    judge: No. First, you must get a lawyer, as only a lawyer can truly understand the law.

  26. Intellectual Property has the same goal by jonesd · · Score: 2

    Okay, I'll extend the statement above one step further: intellectual property and open source have the same goal. Copyrights, as well as patents, encourage disclosure of information by protecting the author. Seriously. Intellectual property law is supposed to promote the sharing of information by guaranteeing compensation for the author. It does so by giving the author/inventor a monopoly on certain rights related to the work. Basically, intellectual property and open source are two different attempts at solving the same problem. Intellectual property law is a capitalistic approach (guarantee them money, and they will build it). Open source takes a different approach, roughly related to "to each according to his needs, from each according to his abilities" (I'm quoting from memory, ask me if you want the source). Neither is perfect. I personally am intrigued by the idea of some form of government tax funding innovation (and yes, I am an academic researcher currently). I believe Stallman alluded to this idea.

  27. Doesn't work... by Greyfox · · Score: 2

    Joe Blow working in his basement would not go for a frivolous patent because for him patents are damn expensive. Nor could he afford the cost of taking a frivolous patent to court on either side. OTOH, Joe Big Corporation will have no worries about patenting, say, printf (Excuse me: A Method Of Formatting Arbitrary Strings of Characteres in C) on the off chance that if they threaten to sue 100 people, a couple of them might settle because it's still cheaper than going to court.

    --

    I'm trying to teach myself to set people on fire with my mind... Is it hot in here?

  28. Real reason for Patents by NerdFromHell · · Score: 2

    Patents were first implemented to prevent tradesman and craftsmen from hiding their technology. Remember that from the 15th century to to the industrial revolution, trades like metalurgy kept the secrets of their trade, to prevent the common man from competing against the established brotherhood of trades. The Patent was an attempt from the government to force the technology out of the trades and into the common man's hands. A concession was made with each discovery, that the trade could own the monopoly on it for a number of years, which at the end of the term it would be become public domain. It worked very well, and was probably largely responsible for the industrial revolution. Today, with Capitalism running better and freer that ever, and the fact that no company can really keep a secret, the Patent is a legacy idea, that no longer serves us at this time, when transparency is at an all time high. The King is dead, long live the King.

  29. Re:patent "problem" is part of something much bigg by jms · · Score: 2

    Eldred v Reno has been appealed. The judge who heard the case wrote an extremely poorly thought out and nearly indefensible opinion. My impression on reading his decision was that he either didn't take the case seriously, or that he basically punted the case to the appeals court, possibly because he was afraid of the tremendous consequences of making even the smallest finding in favor of the plaintiffs.

    The "problem" with this case is that if the judge were to accept the premise of the suit -- that retroactive extension of copyright is in and of itself unconstitutional -- then logically, ALL retroactive extensions of copyright would be also unconstitutional. Removal of all retroactive copyright extensions would place all works created prior to 1944 in the public domain, and restart the currently-stopped copyright clock, with tremendous political consequences, since the most powerful and influential corporations in the world are film studios, record companies, and especially media corporations, which obtain much of their power and income from their extensive copyright holdings.

    In other words, he tossed the hot potato to the appeals court. I fully expect this case to go all the way to the Supreme Court.

  30. Patents don't always promote innovation by EricEldred · · Score: 2

    Josh Lerner at Harvard Business School has studied the economic affects of patents (see http://www.people.hbs.edu/jlerner/P atintro.html and associated links. He concludes that there are many indirect costs of patents and discusses the "concern that the pattern of costly litigation--or payments to forestall litigation--are leading to reductions or distortions in innovative investments, particularly for small firms." In his study of small biotechnology firms, the trend was to protect research by trade secrets instead of patents, mostly because of the costs (it costs more than $1 million to defend a patent). Obviously, the public loses when the research is made a secret instead of openly disclosed. Nobody else can build on the work and improve it, and when the patent period expires the secret is not disclosed. Since much innovation is achieved by the small firms, this trend is disturbing. Remember, the purpose of patents according to Article I, Section 8, of the Constitution is "to promote the progress of science and the useful arts." It seems to be time to rework the patent system from the ground up, to try to achieve the original objections in a better way.

  31. Flip it back over- was: the other side of the coin by LetterRip · · Score: 2

    "I will point out that even in our current system the megacorp will always win. I've personally worked at smaller companies that have had valid patents that were infrindged on by very large companies."

    Did they purchase patent insurance? There are policies that the Insurance company pays all of your lawyer fees, but gets to recover their costs, plus a percentage of the damages.

    It seems much less likely that the big company is going to infringe in such a situation...

    LetterRip

  32. Re:patent "problem" is part of something much bigg by Danse · · Score: 2

    It seems to me that the Constitution is quite vague about the power it gives Congress with respect to copyright. What is a limited time?

    It doesn't explicitly give Congress the power to retroactively extend copyright terms, but it doesn't explicitly prohibit it either. You have any idea how the courts have looked at this kind of thing in the past? Doesn't it mean that the power goes to the states if it isn't specifically given to Congress by the Constitution? Or have they used the "interstate commerce" wildcard again? Btw, I've forgotten what amicus briefs are. Fill me in?

    --
    It's not enough to bash in heads, you've got to bash in minds. - Captain Hammer
  33. Question by Danse · · Score: 2

    Patents are only supposed to be awarded for inventions that would not be obvious to an expert in the field. Doesn't that mean that every patent should be REQUIRED to be reviewed by an EXPERT in the field, as well as having a prior art check done? Seems like all they do now is a quick prior art check and then award the patent. This goes entirely against what the patent system was supposed to do for us. We're now being prohibited from using obvious techniques and business methods. This is part of what is so screwed up about the patent system.

    --
    It's not enough to bash in heads, you've got to bash in minds. - Captain Hammer
  34. Re:Non-obviousness is not very obvious by Danse · · Score: 2

    People in the patent office trying to apply it to individual patent applications must be so perplexed that they are easily swayed by factors other than the law.

    I think that's what I'm getting at. The people in the patent office aren't qualified to be making the decisions they're making. An expert in the field is the only one who can make the call on whether something is obvious or not. There are probably damn few experts in any field employed by the patent office. They can usually get better jobs elsewhere.

    --
    It's not enough to bash in heads, you've got to bash in minds. - Captain Hammer