I really don't like saying this, but here it goes:
Don't hate the player, hate the game.
We need real, substantive patent reform in this country.
Don't hate the player, hate the game.
We need real, substantive patent reform in this country.
B) This is not the game. As Fred Wilson explains, web company patents have been thought of as defensive. If this triggers a wave of patent lawsuit bullshit, then everybody will end up poorer. Except the lawyers, of course.
Just remember though that right now the pharmaceutical companies are massively outspending the technology sector as far as lobbying Congress. (A Senator is a wonderful thing --- everyone should own one!)
As a Google employee I can contribute to Google NetPAC. I'm not sure what opportunities exist towards donations to organizations that directly lobby Congress. The EFF is an advocacy organization, which is a good start, but they are not a lobbying organization per se.
It's a horrible system and it's not a productive way to use money as far as society is concerned, but unfortunately, it's the way the game is structured, and if you don't play the game, you'll get run over by those who do....
What? I was under the impression that they rely mostly on advertising to recoup costs, their advertising budgets are generally much larger than their R&D budgets.
Big pharma uses patents to protect their monopoly on a drug for seven(?) years after its introduced. Once that window is up, generics come in and take a huge chunk of sales. Pharma uses marketing and advertising to push their new drugs to try to sell as many during the patent window as they possibly can, when they have a large markup on it.
Their primary function, as you say, is shifting far towards the marketing end.
It's completely irrelevant what the size of their advertising budgets are. They will increase their advertising budget as long as they think that the added revenue will be larger than the added costs.
But if they have no patent protection, they will probably have no profitable product to advertise at all.
There are real advances too, and those wouldn't happen without some ability to generate a return on the $1B or more you spent on the drug (let alone the hundreds of millions on drugs that didn't make it).
R&D being a small part of the budget doesn't change that. The fundamental business is still based on the patent system.
That sounds like a terrible idea though: now you'll have the govt "picking winners" that can go to market. As with anything in the government, that will be subject to tons of lobbying, earmarking, waste, and endless debate.
But if you think about it, Pharma drugs are actually similar to SW or movies or music. In each of those, a large investment produces a good which is cheap to replicate (knowledge of efficacy/safety of a compound, or in SW / movies / music, bits arranged a certain way).
Each of these need protection on the investment to create it, so that there can be a return.
In SW, music, and movies/etc, that protection is essentially copyright law.
The only difference with Pharma is that copyright law doesn't buy them anything. So they need some other mechanism of protection.
Maybe it doesn't have to be a patent: how about an exclusive government license to sell a pharmaceutical tied to the FDA approval. Kind of like a pharmaceutical-specific patent.
The key is that financing still happens via private means, and there isn't a fixed quota of budget or # of drugs... Let the market decide the right amount for our society to spend on drugs.
The government should step in when there is a market failure (e.g. unpriced externalities, or tragedy-of-the-commons, etc). But just the fact that there's a large investment that needs protection for an ROI isn't a market failure.
Take this absurd Facebook patent as an example
>System and method for dynamically providing a news feed about a user of a social network (US2008040673).
While the situation is different, as Facebook aren't suing anyone (yet), we can imagine if the roles were reversed, the story might be a little different. Why else would they file for patents if their intent wasn't to defend "their ideas."
If we're calling out Yahoo's patents as junk, we should be doing the same for facebook and the rest, otherwise we're turning a bad system of "who dunnit first" into an even worse one, a popularity contest.
As the original article said, most SV web companies claim to file patents as a defensive measure - so if they get sued by someone else, they can hit back. Suing first is extremely bad form.
> If we're calling out Yahoo's patents as junk, we should be doing the same for facebook and the rest
I don't see anyone saying that Facebook's patents are fine and Yahoo!'s are junk - Yahoo! are being criticised because they're attempting to enforce their junk patents. If Facebook attempted to force theirs they would get exactly the same flack for it.
Then you are demanding that the board neglect its fiduciary responsibilities and go to jail.
> A point about the morality of companies angle: the so-called "fiduciary duty" of companies that is an overriding duty to maximise shareholder returns within the constraints of the law above all other ends is a legal obligation in only a few countries. In most countries, including most states in the US, executives have a legal responsibility to be honest and open about their performance and honest (if not very open) about their strategy, but have no legal obligation to prefer a more profitable course of action over another, which is obviously right since there is usually no knowable fact of the matter about whether one business plan will turn out to be more profitable than another.
> In short, the idea that companies have a moral obligation to act immorally if it pays is mostly or always a myth.
There is no chance that Yahoo executives would go to jail if they decided not to pursue a cursed-earth patent troll strategy. Fiduciary duty is about executives not putting their personal interests before that of the shareholders.
It is not even obviously in the company's interest, what they are doing. If cash-rich FB refuses to settle, all 10 patents get invalidated, and Yahoo has to pay heavy legal fees, then Yahoo is left with a smaller warchest of patents, and one whose firepower has been seen to be lacking. Does the quiet period make that such an unlikely outcome?
[1]: https://plus.google.com/u/0/103703080789076472131/posts/K74a...
The selling of a company doesn't exactly fall into maximization of shareholder profits: it depends on a couple things. The board of a company has no obligation to maximize it's short term value. Otherwise, anytime someone is offered a profitable buyout and turns it down they would violating their social responsibilities. I could be wrong, but I had a similar discussion with a close friend who is a big dog in the world of finance and that's the message I got from him.
Here's some relevant info: >The role of such statutes is especially important in light of the QVC decision, which prohibits directors from simply approving a strategic merger based on their business judgment that the transaction provides more value in the long term. http://apps.americanbar.org/buslaw/blt/8-3shareholders.html
Also, you may be interested in this. http://sloanreview.mit.edu/executive-adviser/2010-3/5231/the...
If they go for it, win, but every single talented engineer at Yahoo! quits in disgust and the company falls apart, should the board go to jail then as well?
besides, I would argue that the cost in both goodwill and brand value of pursuing a strategy of patent licensing far outweigh the potential benefits.
[1] http://en.wikipedia.org/wiki/Business_judgment_rule#Standard...
So brand isn't a good argument against this suit for Yahoo.
Morality might be. But it's hard to get people to act against their financial best interest over the long term, so I still feel the real issue is the patent system.
Facebook has a lot to lose if it is perceived that Yahoo can hurt them, now that they are going public. Which is exactly why Yahoo is doing that, and why they did exactly the same thing when google went public.
http://news.ycombinator.com/item?id=3698637
I'm sure that it has a lot of problems, but we need to start having the discussion of how to fix the system, instead of just whether or not it needs fixing.
Long story short, kill patents, kill copyright, keep trademark.
http://arstechnica.com/open-source/news/2009/07/pirate-party...
Contracts are only valid if there is an exchange of value; you could reasonably argue that there is no value in being granted a right you already have.
"Free software" vastly overestimates the value and talent of the average user--I don't feel any pity for the average City Of Farm Wars user if they don't get the source to IE.
Kickstarter already funded over $1m entertainment projects. So did the Louis CK experiment. These are far and far away from the mainstream popularity that buying movie tickets have. Don't you think that it's reasonable that web organized crowd-funding could finance even big blockbuster movies as these websites get more popular?
Imagine if popular celebrity directors with huge cult-followers like Tarantino would post a project on Kickstarter, then properly advertise it. I'd imagine a huge movie could be funded that way.
Kinda true, although lots of films make more money through merchandising than the box office.
But even in that situation, why can't movies be funded by crowdsourcing? I'm sure there's lots of fans of LoTR who'd be happy to crwodfund The Hobbit, for example.
Crowdfunding can be a viable option, but paying large sums of money before any work is done makes it tempting to abscond with most of the money and produce either an inferior or nonexistent product. How would you prevent this from happening on a regular basis? Would your solution make it too risky to attempt large projects out of fear of them not being deemed "good enough"?
Not if you keep trademarks and have trademarks on the relevant characters, objects, etc.
In other words, you're free to do anything you want with the Harry Potter movies, so long as you remove all instances of the name "Harry Potter" and all likenesses of Daniel Radcliffe wearing a robe?
Mind you, the trademark owner can authorize things. And I think there is even some analog of fair use for trademarks, but you should consult with a lawyer if you ever have more than an academic interest in such things.
Bad things are done in the name of copyrights (and patent protection). That doesn't invalidate the whole concept, it just means reform may be needed.
Besides, it's only a knock-off if you were exposed to the original.
This would let the market actually sort out what is naturally viable.
Because prefunding is effectively a requirement, there's no way for a creator to take a gamble, produce something with their own resources, and then try to make it up later. This is essentially the process by which all novelists get started now. Are you sure that prefunding is a suitable replacement?
If you can't raise sufficient funding, frankly, that's a your problem. There are a lot of people (myself and cofounders included) who prefund by working some job (of varying degrees of satisfaction) and diverting the funds towards development of their own creative enterprises.
In the absence of patrons, yeah, we fund ourselves, and one day it'll pay off--or it won't. That's life.
Novelists are great and all, but it seems obvious that if you cannot write something quickly enough on a budget, or in your freetime, and it isn't good enough to get picked up, well, sorry. The system should be in place to let you fail fast and figure out what to do next.
Prefunding isn't going to get us flying cars, just faster horses.
Yes, current patent law is broken, but that doesn't mean that Y! have to use it. If this was a defensive move against a patent claim from Facebook, I'd have some sympathy. But as far as I can tell, it isn't. So I don't.
And you can be sure that companies once they have lots of patents will lobby mercilessly to keep the current "game" in place. Who wants to stop playing when they feel they are winning?
Apart from some sudden massive outbreak of sanity, there is no way out.
(and yes, their shareholders and executive force them to play it.)
This player will most likely also lobby aggressively to thwart any attempts at reforming the patent system since it is one of its few remaining sources of revenue.
It may take all out war, and an overwhelming of the legal v startup ecosystem, before sense returns. Akin to the opinion piece in the NYTimes "Go to Trial: Crash the Justice System" over the weekend.
1) A pharma company spends $1B on R&D to develop a drug and get FDA approval. If someone could knock off the resulting compound at 10 cents per pill, we wouldn't have the drug.
2) Software companies, where there are hundreds of potential patents to file or infringe on, and there is tons of iterative evolution.
Seriously, where is the moral imperative that says "Thou Shalt Not Patent Troll"?
That said, note that this isn't an abuse of the system--it is very much using it to the letter of the law. Note further that, at least in America it would seem, we place a very high value on the letter (as opposed to the spirit) of the law.
I still think there isn't a fully developed moral argument here, but at least you've elaborated on your position. For what it's worth, I think the rough sketch of the argument would go something like: scarcity is Bad, knowledge promotes nonscarcity therefore Good, patents intended to promote knowledge therefore Good, wording of patents allows companies to act to decrease knowledge there Bad.
I just wanted to make sure you had a better backing than the usual "Oh noes patents are teh evil and the abuses you see".
If we're ever going to fix this mess, we need to make sure our ideology and reasoning is in line and clear.
- Knowledge and progress are beneficial for the society. - Inventions and discoveries promote knowledge and progress. - Patents are supposed to encourage inventors to publish their work thus helping the promotion of the above. - If applied badly, patents can be misused to serve totally different goals (like monopolizing the technology or knowledge), hurting the society in result. So the system needs to avoid that.
Software patents are the perfect example of the case where the original goal is reversed. I.e. by the nature of the software, patents only hinder innovation. So they should not be applied to software at all.
And that's why I called it unethical, rather than illegal. Patent aggressors might appeal that their actions are legal (within the current broken system), but since they have negative impact on the society and serve totally the opposite goal, they are unethical.
In case you missed it, it's the players who make the game and keep it running - a self-sustaining spiral of endless bullshit.