In new case, Supreme Court revisits the question of software patents
m.washingtonpost.com
m.washingtonpost.com
When old (and stupid) patents hinder innovation (what happens all day today), than the patent system becomes the biggest hindrance to innovation. Somebody said about IP: When it is better to "own" old IP than to make new one, the system is strangling innovation, nothing else. We already at this point (and it was fostered by the owning people).
Patents once where made up, to bring inventors an incentive to share their inventions with the others. But this "sharing" brings only benefits to the society, when the inventions bring any knowledge gain to the community.
Software patents are the worst: Most of them include trivial things that do not bring any new knowledge to the industry, but are blocking other inventors. Good example is Amazons One-click patent (but this is only one of maybe thousands examples): What is the knowledge gain of the world, by having this patent?
This system is for the "owners" not for the "creators"!
The thing about "IP" is also, that differently from "ideas" or "inventions" -- "property" can be sold and bought. Also in the most cases, inventors are small people in big corporations that just get some small and fixed (at least in Germany this is the normal case) money for it. A bargain for the corporation that "owns" from now on the "ideas" and "inventions" of their employees.
Make a price tag on everything and you will get a world not worth living in!
[0] http://www.businessinsider.com/steve-jobs-would-annoy-jony-i...
One thing investors fear is investing in small unknown people where once the secret sauce is visible, it can be easily copied. In particular, copied by large corporations with customer channels, marketing muscle, deployed software installations with patch/upgrade cycles, etc... Investors often look at barriers to entry which patents happen to provide.
There was once a company, it got visited by the lawyers of a big corporation.
They claimed that this company violated patent X of the corporation and they wanted Y millions for it. The smaller company proofed that they did not violate this specific patent.
The lawyers just said, that their corporation owned X thousands of patents and many, many lawyers worked for it. If they go empty today, they will search and find 10 patents that where violated by the smaller company.
Tell what, the smaller company paid.
It might be, that to own some patents is good and to ask for it is reasonable for investors. But with the view on the nationwide or world-wide economics, patents are essential bad.
I once also heard (I am not so good in this history, so sorry I can not give details), that the US economy and inventions had so a quick rise, one reason was because they at first abandoned the patent system of the UK and did not care about the patents in the "old world".
Patent reform should focus on helping small and independent innovators, when in reality it is being driven by large deep-pocketed corporations.
That is right. I am also wondering all the time about the focus of patent reforms: so called patent-trolls. But as annoying they might be, the whole case looks very much like a diversionary tactic to distract from the real problems of the system.
[1] http://www.ipwatchdog.com/2013/05/01/is-patent-litigation-re...
Nailed it with that one. That's exactly why companies like Microsoft and IBM [1] fight so hard to keep the current patent system, or even make it worse. They have so much more to gain by rent-seeking with their old bogus patents than by creating new ones (especially if the new ones would have to be put through much more rigorous filtering), since they're not really the innovators in the tech industry anymore.
[1] - http://www.washingtonpost.com/blogs/the-switch/wp/2013/11/20...
Nor the consumers, who end up paying for this mess.
The "abstract idea" line drawing is complicated from both sides, however. Say you develop a clever algorithm for doing transmission power control for a WiFi radio. If you implement it on an ASIC, that's almost certainly patentable. But what about an FPGA? Or a general purpose processor? If software patents are categorically invalid, you end up being able to patent things in ASICs that can't be patented if done on a GPP. If they are valid, that doesn't help when someone tries to patent something like a mechanism for hedging risk.
I think the real issue is looking at whether the algorithm embodied in a patent is a general concept, or a narrow domain specific design. In other words, you shouldn't be able to patent the concept of transmission power control. But you should be able to patent a specific method for doing transmission power control they arises out of capital intensive research.
They don't have to draw a distinction, of course. The last time a finance patent came before the Supreme Court in Bilski in 2010, there were two theories about why the patent in suit wasn't valid under 35 USC §101. Four judges agreed with each theory, leaving only Justice Antonin Scalia to decide. Scalia joined with the conclusion of each side and the theory of neither, leaving the situation even more confused than before.
Most likely the exact same thing will ensue this time.
TBH, I'm not terribly familiar with what can and can't be patented as per business methods. But technically all things that can be computed, can be computed by enough people doing the arithmetic. Computers just make this much faster.
So if I have 300 people...I dunno, collating wedding invitations, and come up with a way of doing it in software, that's not patentable?
However, a clever algorithm for computational imaging is arguable patentable, but anybody who knows matrix math can probably do it manually.
So is it really a discussion over the magnitude of the assist to humans doing the grinding computations by hand and where that line is drawn? Or to your example, some software running on a general purpose CPU can often be implemented as DSPs or some other specialized hardware, it's obviously no longer software I suppose once it's a DSP, even if the method for doing the computation is the same.
The real question is: what sort of algorithms do we want people to be able to patent? This is an economic question, not a legal one. At what point does the benefit from disallowing free riding out weigh the cost of granting the temporary monopoly? The problem with the law is that it sidesteps this question. Its based on an 19th century notion of invention, whereas the real value of patents is protecting investment into R&D.
One-click shopping? I believe there was lots of effort put into engineering it, but not so much on the R&D side.
Is a patent examiner qualified to implement whatever decision is made on where that line is? I think it's still going to remain a minefield for a very long time.
I think this is one reason the courts have also not had much luck finding any useful & principled theories of invention to apply. The law assumes a kind of classical "eureka!" theory of invention, where there is normal work and then the occasional Invention, which few scholars these days think is how technological advances actually happen. So if the courts were to try to read a scholarly book on either the history or current state of technological advances and try to make use of its concepts (courts sometimes do that kind of thing, if they can find something that will help them make a principled distinction) there would just be a big mismatch in basic assumptions and framework. So they don't, and instead are stuck with trying to make the best of a kind of cobbled-together theory of what constitutes an invention vs. a non-invention. And at this point, absent Congress significantly rewriting patent law, there isn't really much they can do except continue that process of accretion, by doing line-drawing in the gray areas of the existing case law when an opportunity arises.
It baffles me why we have a patent system (to address precisely this problem) and also legal protections for "trade secrets".
effectively, patents protect the two constituent groups required for innovation: (1) creators and (2) investors.
music, art, film, restaurants, and mobile apps demonstrate that patents are not necessary for people to invent (though some IP like copyright seems mandatory). in some fields, the joy of creation and the promise of financial gain, even if unprotected and unsustainable, is sufficient motivation for invention.
the common thread, of course, is capital efficiency. it's far easier to risk investment and innovation when little money is required. investors are needed for innovation in capital intensive areas, but investors historically have been ROI motivated and sought assurances, such as patents, that their money will yield a return.
crowdfunding enables creators to break from ROI-investors and find financing from a different set of people: those who want not a ROI, but a specific product or service. most importantly, these "investors" care less about patents or the long-term viability of a company. they just want a product/service to exist -- from anyone.
we're already seeing this unfold on kickstarter and indiegogo. the question is whether lobbyists and governments cripple crowdfunding, or allow it to reach its maximum potential.
if people will innovate, regardless of patents, and other people will underwrite products, regardless of patents, why do we need patents to foster innovation?
A great example is the Spaceship One patents. The arrangement there was that Scaled Composites would do the R&D, and Paul Allen would invest, and companies like Virgin would commercialize. Having a property right that can be the subject of transactions is tremendously valuable for these sorts of arrangements.
To the extent that the method does not result in the purpose, the patent system is a failure.
That's directly contrary to the text of the U.S. Constitution, article I, section 8, clause 8, which gives Congress the power: "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."
The Supreme Court's canonical explanation of patents' constitutional purpose was written by Justice Clark, for a unanimous Court, in Graham v. John Deere Co. of Kansas City, 366 U.S. 1 (1966): [1]
==BEGIN QUOTE==
... The clause is both a grant of power and a limitation. This qualified authority, unlike the power often exercised in the sixteenth and seventeenth centuries by the English Crown, is limited to the promotion of advances in the "useful arts." It was written against the backdrop of the practices—eventually curtailed by the Statute of Monopolies—of the Crown in granting monopolies to court favorites in goods or businesses which had long before been enjoyed by the public. See Meinhardt, Inventions, Patents and Monopoly, pp. 30-35 (London, 1946).
The Congress in the exercise of the patent power may not overreach the restraints imposed by the stated constitutional purpose.
Nor may it enlarge the patent monopoly without regard to the innovation, advancement or social benefit gained thereby.
Moreover, Congress may not authorize the issuance of patents whose effects are to remove existent knowledge from the public domain, or to restrict free access to materials already available.
Innovation, advancement, and things which add to the sum of useful knowledge are inherent requisites in a patent system which by constitutional command must "promote the Progress of . . . useful Arts."
This is the standard expressed in the Constitution and it may not be ignored. ...
==END QUOTE==
Id. at 5-6 (emphasis in original, extra paragraphing added.)
As 'wnoise correctly points out down-thread, protecting capital-intensive R&D from free riders is not an end in itself, but merely a means for achieving that end.
[1] http://scholar.google.com/scholar_case?case=9105652591497305.... The decision was 7-0; two justices (Stewart and Fortas) took no part, which usually means they recused themselves because of conflicts of interest such as personal business investments in one of the parties.
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I suspect not many readers understand the above facts.
If you purchase a US patent, this is what you get: a right to sue.
Nothing more and nothing less.
If you have any doubts that the above is true, ask your lawyer.
Knowing exactly what a patent is should make you think more carefully about what a patent may or may not "incentivize".