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Ex-Microsoft CTO Checks In On Patent Reform
theodp writes "Defending his controversial Intellectual Ventures in a less-than-hard-hitting CNET interview, ex-Microsoft CTO Nathan Myhrvold finds it peculiar that some people get really wound up over patents. 'People generally don't have any problem with the patent system,' quipped Myhrvold, the inventor of Microsoft's patented Television scheduling system for displaying a grid representing scheduled layout and selecting a programming parameter for display or recording, which allows you to more efficiently select shows like Elimidate for viewing."
If he doesn't understand why people don't like software patents, then maybe he should have paid more attention to his (ex-)boss.
... The solution is patenting as much as we can. A future startup with no patents of its own will be forced to pay whatever price the giants choose to impose. That price might be high. Established companies have an interest in excluding future competitors." b gates91)
"If people had understood how patents would be granted when most of today's ideas were invented and had taken out patents, the industry would be at a complete standstill today.
-- Bill Gates in a 1991 internal memo (Source: http://swpat.ffii.org/vreji/quotes/index.en.html#
What do you think of the complaints of how patent litigation is hurting companies? Some days it sounds like the trumped-up malpractice crisis of the '80s.
Myhrvold: Well, this is even stranger. We actually did a study on this. The overall number of lawsuits for patents is growing, but so is the overall number of patents. So explain that to me.
- this guy doesn't need anything to be explained to him, he is a crook. He did a 'study'? Let him point to the study. Let him show us that study. I bet it was nothing like a study. I bet he sit down with a couple of guys over a beer and talked about how much money they could make from litigation and that was his study.
If you then look at it and ask, what fraction of those lawsuits are due to companies that have no products, the IP-only companies--it's about 2 percent. If you look at it and say what fraction of lawsuits are due to large technology companies, it's about 2 percent.
-Look at that, he's got some numbers! I bet he just pulled those numbers out of thin air. I don't know how many companies are out there suing each other over stupid patents but I am sure it is not 2 percent. It is either something very very small like 0.0001 percent or something very large, like over 60 percent but saying it's 2 percent doesn't make any sense. It's not a real number.
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This guy hopes to make money on litigation that much is clear. He calls himself an inventor. Inventor my ass! I 'invented' things. Plenty of things. One of them is in my russkey extension - selecting text in a browser and transforming it into a different type of text right on the page. There. An invention. I bet anyone can come up with that. And I bet it would stiffle innovation if I started suing other people for doing the same.
You can't handle the truth.
I'm a grad student studying computer security. Recently, I made some discoveries which have the potential to significant increase the security of Web transactions. (With luck, I'll be presenting at Black Hat 2005, so please forgive me not saying more than that until my submission gets a thumbs-up or a thumbs-down.) After hearing from several Ph.Ds in the field that this idea was fairly novel, I decided it'd be good to talk to a patent lawyer. After all, I came up with it on my own time, without using any university resources, in private research unconnected to my university activities, and under my contract my discovery belongs to me.
.1 = $2,000). What I'm left with is how much it'd cost me to get a patent, or $18,000.
...
So I did my research and found one of the better IP lawyers in the state. I walked into his office with a preprint of my academic paper, copies of existing academic articles which may be considered prior art, everything I thought he'd need.
His first question was whether I was willing to go bankrupt for this idea. "Uh... what?" I asked. That wasn't what I was expecting to hear.
The average cost for a successful patent, he explained to me, runs around $7,000. That news floored me; isn't the patent system supposed to be accessible to private citizens?
Oh, no, he told me, that's not the price. That's the price for a successful application. Right now, only about 35% of all software patents are granted. So the amortized cost of a software patent is about $20,000.
Then it starts getting even worse.
About one patent in ten will ever make their original investment back from licensing fees. The overwhelming majority of patents issued fail to recoup their initial outlay. Most patents are not used to get licensing fees; most patents are used to deny other people entry into your market. If a patent can keep other people out from your business, then it might make financial sense; but as it currently stands, since I have no business in this area of the security field... I'd be looking at one chance in ten of recouping my patent cost.
So, in other words, take the amortized cost of a patent ($20,000) and subtract from it the speculative revenues I'd be receiving ($20,000 *
That's considerably more than I make in a year as a graduate student. I could possibly, if I sold all my worldly possessions, get that much money together, but I'd probably have to declare bankruptcy as soon as it came time to pay my student loans. Hence, his question: is this idea worth going bankrupt over? Especially given the unavoidable fact that, if I did manage to beat the odds and get good licensing, all the major players would simply threaten to sue me for infringing on patents of theirs I didn't even know I'd infringed, and would offer just a no-cost cross-licensing deal that would let them have access to my patent for free, and all I'd really get out of it would be the mercy of them not suing me?
I'm not opposed to the existence of software patents. I think they're wildly overused, and overused in unethical ways, but there are some algorithms which are so breathtakingly new and innovative that they deserve patent protection. (RSA comes to mind as an example.)
I am opposed to a patent system which is priced far outside the capabilities of private citizens.
I am opposed to a patent system which is structured in such a way that large companies can get unlimited access to the small guy's patent portfolio just by threatening a lawsuit.
I guess you could say I'm opposed to practically every dimension of how patents are currently practiced.