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Groklaw Says Microsoft Patent Portfolio Now Worthless

Posted by CmdrTaco on from the along-with-most-patents dept.

twitter writes "P.J. concludes her look at the Bilski decision: 'you'll recall patent lawyer Gene Quinn immediately wrote that it was bad news for Microsoft, that "much of the Microsoft patent portfolio has gone up in smoke" because, as Quinn's partner John White pointed out to him, "Microsoft doesn't make machines." Not just Microsoft. His analysis was that many software patents that had issued prior to Bilski, depending on how they were drafted, "are almost certainly now worthless." ... He was not the only attorney to think about Microsoft in writing about Bilski.'"

14 of 219 comments (clear)

  1. It doesn't matter... by nebaz · · Score: 5, Interesting

    I think Microsoft wins either way. They are not generally a patent troll company, nor are other large companies (IBM) with massive patent portfolios. If their strategy was to countersue little companies which had (somewhat) frivolous patents as a defensive measurement, they win either way. Either their patents are valid, in which case they have a good defense strategy, or they are not, and neither are the patent-troll lawsuit patents. I read somewhere it costs $10,000 or so to file a patent. This is chump change to Microsoft.

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    Rhymes that keep their secrets will unfold behind the clouds.There upon the rainbow is the answer to a neverending story
    1. Re:It doesn't matter... by eldavojohn · · Score: 4, Interesting

      I read somewhere it costs $10,000 or so to file a patent.

      I think the costs (depending on if you qualify as a "small entity") vary on filing fees ... you should really point out that the $10k figure comes from patent lawyers you hire to make sure your patent comes through in a timely fashion. If you don't have an army of those, the smallest slip of forgetting to cross reference another patent could cost you decades. Yes, refiling and additional services listed on that page will drive the price up but a timely patent is probably worth much more than what you would save if you didn't have a patent lawyer. If it's a one time thing, I would suggest finding a firm.

      This is chump change to Microsoft.

      If you're applying for 10 or 20 patents a week then this isn't "chump change." It's more than likely several million dollars a year for an entity like Microsoft. I think it's still important to Microsoft because of what investors see a patent portfolio as: pure assets.

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    2. Re:It doesn't matter... by Jah-Wren+Ryel · · Score: 4, Interesting

      I think Microsoft wins either way. They are not generally a patent troll company, nor are other large companies (IBM) with massive patent portfolios.

      Just because they aren't trolls doesn't mean they do not make a significant portion of their income from patent licensing. If their patents are no longer valid, then obviously their licensees are going to stop paying royalties.

      While I am too lazy to dig for URLs right now, if you look, you will find that patent licensing is a huge part of IBM's business nowadays and that about a decade ago, Microsoft hired the man chiefly responsible for monetizing IBM's patent portfolio so that he could do the same for Microsoft.

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  2. MS wins with relaxed IP by tjstork · · Score: 3, Interesting

    The whole reason the patent system exists is so that the "little guy" will have incentive to make a product without fear of the big guy stomping them. Of course, it turns out that the big guy with a 1000 patents a year deters any competition, so, there's obviously going to be more competition if this ruling means as the article says. But, at the same time, if I genuinely do make a product that is new, then, big companies will be allowed to take it. In fact, anyone will.

    As such, patents aren't -that- bad, but just imagine if copyrights were also deregulated to a degree. Yeah, people might be able to copy madonna songs more freely (as terrible a thing to do as that is), but, at the same time, the GPL would lose quite a bit of its teeth as its only as good as the rights the code authors have. If you are MS, looking at a billion in Windows development costs a year, suddenly a few hundred million in political "donations" in favor of candidates that are willing to legislate in that open source means public domain, and suddenly Linux is on everyone's desktop, but, it's closed source!

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  3. Re:Sigh... it's Groklaw... by UnknowingFool · · Score: 3, Interesting

    Well, no. At least with Groklaw, you can read the decisions and briefs directly and make up your own mind if you don't like the commentary and analysis.

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    Well, there's spam egg sausage and spam, that's not got much spam in it.
  4. Re:What I really want to know by larry+bagina · · Score: 3, Interesting

    No. The decision affects business method patents, not software patents. Software patents will probably get a direct challeng at some point, but that point is not today.

    --
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    These aren't the 'roids you're looking for.

  5. So, who wants to go first? by confused+one · · Score: 4, Interesting

    So... Who wants to be the first one to try violating one of Microsoft's software patents and test it in court? Hmmm?

  6. Re:"Microsoft doesn't make machines." by Tastecicles · · Score: 5, Interesting

    let's have a look at the innards of my son's xbox crystal which he just drowned in orange-flavoured soda...

    HDD: Seagate. No.
    Processor: Intel. No.
    Memory: Samsung. no.
    Northbridge: NVidia. No.
    GPU: NVidia. No.
    various I/O, timer and controller chips: Texas Instruments. No.
    Controller ports: I have no idea. Possibly not, although they are in essence, usb ports with slightly more robust terminal connections. ...in fact, I don't see one single component in there that has a Microsoft logo on it. Given that the HDD and some other components actually state "made in Taiwan" somewhere on the label, I can only conclude that the box was assembled in China. The software, on the other hand...

    kernel/UI: is a multiboot system. He has the choice between the classic xbox Win2K kernel/UI (Microsoft), the extended interface that allows him to copy games directly to the HDD and do all manner of other wonderful and weird stuff to the system and play any of several thousand in situ games via any of the dozen or so emulators (almost certainly not Microsoft), and Linux (ha!).

    So no, they don't make machines. Their scrollwheel mice were built by Logitech (albeit maybe to Microsoft's specification). The kernel software that shipped with the xbox classic was... well, sort of. Microsoft codeveloped NT with IBM under the label "OS/2". OS/2 died a horrible death, NT was a victim of its own success.

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    Operation Guillotine is in effect.
  7. Re:Mice, keyboards, xbox, ... by Drinking+Bleach · · Score: 3, Interesting

    Apple worked around that anyway

  8. Re:Sigh... it's Groklaw... by shaitand · · Score: 3, Interesting

    I don't think Groklaw is being overly optimistic, I think the summary is.

    PJ essentially said that this further erodes software patents and that it may well invalidate one particular type of software patent. A type that Microsoft apparently has a great deal of because they filed a brief saying that ruling the wrong way on this would hurt them.

    PJ did not say that all Microsoft patent are belong to us or all software patent are belong to us. The article is implying that far more strongly than PJ.

  9. Re:What I really want to know by shaitand · · Score: 3, Interesting

    The decision directly affects business method patents but also overrides a standard used to test the validity of process patents and that standard has been used as the basis of a great deal of software patents. Apparently, including a large portion of Microsoft's portfolio.

  10. If the only hammer you have is a tool... by MarkusQ · · Score: 4, Interesting

    Algorithms are not patentable in many countries. So what people do to patent them is they say that they apply for a patent on a "computer system running the algorithm described". Which is a reasonable thing to do since it's pretty hard to run algorithms on a sheet of paper these days.

    The counter attack there being the "not obvious" leg of patentablity. Using a tool for it's intended purpose is considered obvious, and therefore not patentable. Since running algorithms is what computers do, by definition, it's a short step to an "obvious, therefore not patentable" attack.

    Basically, the argument is if you have a nail that isn't patentable and a hammer that was specifically designed to hit nails with then hitting the nail with the hammer is obvious and not patentable.

    --MarkusQ

    1. Re:If the only hammer you have is a tool... by j.+andrew+rogers · · Score: 3, Interesting

      The counter attack there being the "not obvious" leg of patentablity. Using a tool for it's intended purpose is considered obvious, and therefore not patentable. Since running algorithms is what computers do, by definition, it's a short step to an "obvious, therefore not patentable" attack.

      Basically, the argument is if you have a nail that isn't patentable and a hammer that was specifically designed to hit nails with then hitting the nail with the hammer is obvious and not patentable.

      The problem is that you could trivially extend this line of reasoning to any patent or machinery. Patents are not about using something contrary to its nature, indeed that would be nonsensical, but about significant new configurations of something that exploit its nature. After all, mechanical devices are based on nothing more than exploiting the obvious "gear-like" nature of gears, "lever-like" nature of levers, and so one. Just like an algorithm exploits the obvious "bit-manipulation-like" nature of computers.

      Of course, this is skirting around the basic fact that makes these types of arguments stupid to begin with: All Patents Are Algorithms. I thought this was a site for computer nerds, which presumably suggests some familiarity with computational information theory. That is the elephant in the room that everyone is trying really hard not to notice, which suggests more of an emotional than rational reaction to the topic.

      A big part of the existing problem is that the definitions are neither rigorous nor consistent, so intentionally pretending that a difference exists where none theoretically does is just license for gaming and shenanigans, never mind unintended consequences. I have yet to hear a single explanation of why an algorithm implemented with molecules (e.g. chemical process patent) is peachy goodness while an algorithm implemented with bits (e.g. software process patent) is Teh Evil. Every single argument -- every single one -- against algorithm patents apply to chemical process patents, but in practice no one ever makes that case against chemical process patents, which at a minimum raises a lot of questions about the integrity of the position.

      And I am not even necessarily a proponent of patents per se, just a proponent of consistent and rigorous treatment that acknowledges some semblance of reality. Otherwise, the same people will be whining a few years later when the next set of gross discrepancies are exploited. Picking and choosing which parts of reality we like and pretending the rest do not exist is part of what created the current mess in the first place, so I see no reason to continue that exercise. Maybe patents are good, maybe patents are bad, but let's not focus the discussion on politically convenient distinctions that do not meaningfully exist.

  11. Re:"Microsoft doesn't make machines." by lenester · · Score: 4, Interesting

    OS/2 died a horrible death

    Truly horrid... it died for lack of Windows compatibility. And it lacked Windows compatibility because Microsoft was able to convince a judge that Windows 95 was a new and unique product, not covered under the settlement order requiring Microsoft to hand over their API code (enforced through WFW3.11, including win32s).

    I might still be using it today, otherwise.