Patents Don't Pay

tarball_tinkerbell sends us to the NY Times for word on a book due out next year that claims that beginning in the late 1990s, on average patents cost companies more than they earned them. A big exception was pharmaceuticals, which accounted for 2/3 of the revenues attributable to patents. The authors of the book Do Patents Work? (synopsis and sample chapters), James Bessen and Michael J. Meurer of the Boston University School of Law, have crunched the numbers and say that, especially in the IT industry, patents no longer make economic sense. Their views are less radical than those of a pair of Washington University at St. Louis economists who argue that the patent system should be abolished outright.

Comments

This is also the Pirate Party's stance

[CrystalFalcon]

The Pirate Party also claims, with good justification (although a bit less of it in English), that patents should be abolished outright. Good to see some others chime in.

Patents do pay

[Anonymous Coward]

From the 1990's, for publicly traded companies only. Mainly due to litigation costs.

For others patents did better:

Mr. Bessen said that besides girding the pharmaceutical industry, the system did seem to work reasonably well for small companies and individual inventors.

I know slashdot editors hate IP as much as they hate nuance, but the headline does not refect this guy's research.

Re:If you can't tell the boundries, it ain't prope

[ardor]

This has been invented already.

Its called "copyright".

Wright brothers are another good example

[A nonymous Coward]

They first flew under barely controllable circumstances Dec 17, 1903, but then spent several years trying to keep it secret, or at least not publicize it, while they made it practical. They used wing warping which physically bent the wings to control roll, and in order to get around this patented idea, Curtis, in 1908 I think, invented ailerons, hinged sections of wing which have been in use ever since. The Wrights spent the next ten years in court over the matter, and it wasn't settled until the US government forced a settlement when it joined WW I. The Wrights never did much at all after the first few years except sue the competition in court. Everyone else made advances in the technology, but not the Wrights, and they later had to merge just to keep the name in business.

A real lesson in the relative merits of innovation to stay at the front of the pack instead of dying in court battles.