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Comment by tkeller | Hacker News Reader

There are some big companies out there with a lot of their on-the-books valuation existing in the form of software patents. If they suddenly have to mark that stuff down to zero, imagine the crash...

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Only patent trolls would crash, which is almost entirely private equity. Let them crash. In fact, I'd argue that it would be a great good for the market in general to knock the wind out of the parasites who live off of software patent trolling.

Microsoft, IBM, Oracle, etc. companies that make money from legitimate sources would be barely effected at all (and many tech companies who have huge patent portfolios have spoken in favor of ending software patents or making them less broad). And, startups could breathe a sigh of relief and stop worrying about being the subject of extortion the day they turn a big enough profit to be a target of patent trolls.

Besides, this is about how the USPTO grants software patents. It's not about revoking them or abolishing existing patents, though lawsuits to break some of the more pernicious ones probably would follow.

This is simply not true. Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books. If the accountants suddenly had to revalue them to $0, it would unquestionably have a big impact on the share price.

Should that be a consideration when deciding whether to abolish software patents? If nothing else, the USPTO can grandfather the existing patents in, but restrict the ability of their owners to use them aggressively.

Should it? I don't know. Will it? Absolutely.

And what does "aggressively" mean? Making a patent unenforceable will have the same effect as invalidating it.

Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books.

I'd need to see some evidence of this assertion. When I was spending a lot more time researching tech stocks than I do now (now I spend 0 time researching tech stocks), I never saw a patent portfolio as a significant portion of the value of the companies I was investing in. Revenue and growth is king in tech company stocks. Book value is pretty much considered a big goose egg in software companies because they tend to have so little of it compared to old blue chips that have factories, brick and mortar stores, or infrastructure that has real world value. I'd be absolutely stunned if marking down their entire patent portfolio had more than a 1% impact on their market value, because I suspect even less than 1% of their revenue comes from patents...and revenue and growth is how people value MSFT.

Most big companies (fortunately) accumulate patents mainly for defensive purposes. If software patents go away, there will no longer be a threat to defend against.

So they'll be making the same money, with less legal risk. If the market is silly enough to crash in response to that, I'll hustle out to buy as many shares in the crashed companies as I can.

On the other hand, knowing that they're less likely to be sued for patent infringement is probably worth a lot more.

There were some folks who owned a lot of slaves back in the day, too. Not a good argument, by itself, sorry.

not really a fair comparison. Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle to the overarching concerns of Justice and Morality. However, as evil as you may think software patents are, they are not on the same level.

The USPTO should consider economic ramifications of a decision to stop issuing software patents, or to invalidate patents. I'm not saying they should not go ahead and do it, but it would be irresponsible not to consider any potential negative effects.

"Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle" -- It wasn't obvious when slavery was legal.

True, that was mostly certainly historical relativism on my part. Maybe in 100 years people will look back on patent lawsuits similarly... but i doubt it

Seriously? This is your argument? Comparing software patents to slavery trivializes the suffering and evils of slavery.

Perhaps independent developers feel like prisoners (slaves may be too strong a word) where the wardens are software patents. If you ask the FSF, non-Free software is unethical for "enslaving" the knowledge contained in the software (though I think that position goes a bit too far).

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