Missing The Point In The Debate Over Patents

from the fair-and-balanced dept

Over the past few years, the debate over patent reform has gotten louder, as there have been more and more cases demonstrating that the existing patent system is fundamentally broken. News.com has a “special report” up today that tries to look at the issue of patent holding companies who do nothing but try to license patents. In trying to present a “balanced” view, though, the article completely misses the point. It quotes the various supporters of patent holding companies (often referred to as “patent trolls”) talking about how they’re helping protect “the little guy” from big international companies that otherwise would profit off of their intellectual property. It sounds nice, but that’s not what the problem really is all about. The patent system isn’t designed to “protect the little guy.” It’s designed to promote innovation — and that’s what it needs to be judged on. Patents may make some sense in cases where a concept is truly unique and non-obvious — but if others are coming up with the idea independently and are better able to bring it to market, then the patent holder is holding back innovation. The other companies didn’t “steal” the idea, because they came up with it independently (suggesting that it wasn’t unique enough to deserve patent protection anyway). And, as we’ve pointed out in the past, it’s not the “invention” that’s really that important, but the ability to successfully bring it to market that helps the economy grow. Unfortunately, the patent system is more designed to protect that “invention,” but to impede the real innovations that help make a product successful in the market place. All of the points these patent holding firms are making would be a lot more valid if the patents they were holding onto and forcing everyone to license actually were unique, non-obvious ideas that others were really building off of. Instead, they’re taking ideas that plenty of others are coming up with independently and making the real innovation more expensive.

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Comments on “Missing The Point In The Debate Over Patents”

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Tim (user link) says:

No Subject Given

> Patents may make some sense in cases where a concept is truly unique and non-obvious — but if others are coming up with the idea independently and are better able to bring it to market, then the patent holder is holding back innovation.

And even if they aren’t, clutching the idea close to yourself is stifling the potential of the innovated thing to take off, and deserves to be subject to market forces.

Kent Yoder says:

It sounds like the main complaint here is with the

So patent holding companies are using the patent system to benefit themselves and doing so in a way that’s contrary to the original goals of the patent system. That doesn’t sound much different than the ways everyone else is using patents to me. Perhaps we can look down on patent holding companies a little harder because their actions have the additional negative side-effect of not benefitting the economy, but other than that, I fail to see what the fuss is about.

All of the points these patent holding firms are making would be a lot more valid if the patents they were holding onto and forcing everyone to license actually were unique, non-obvious ideas that others were really building off of.

That really goes for all patents, not just ones held by patent holding firms. This just sounds like someone doesn’t like patent holding firms. 😉


John says:

No Subject Given

I hear what you are saying, but consider these points with your single statement of “but if others are coming up with the idea independently and are better able to bring it to market, then the patent holder is holding back innovation.”

1) Personally, I think that if something is obvious *at the time the patent was filed*, then it should NOT get patent protection. And you would have a valid gripe on this one issue.

2) But, when you said “…if others are coming up with the idea independently”, then I am curious what past patents do you feel are truly innovative *AND* if given enough time, no one else would have thought of them?

You are probably going to have a hard time finding candidates worthy of your definition of “patentable” because common sense dictates that virtually *any* idea will be eventually thought up by someone else (given enough time) just out of the normal course of progress. So, why even have a patent system if virtually every idea will eventually be thought up by someone else?

So, in a world where virtually every idea will be eventually thought up by someone else (given enough time), how do you speed up/promote the process of new ideas/innovation? Simple – offer an incentive for new ideas – a capitalistic incentive to be exact.

I believe the patent system was designed to “reward” innovation, with the side-effect of “promoting” innovation because it gives inventors a capitalic incentive to think up new ideas.

Since every idea will eventually be thought up my multiple people (given enough time), how do we choose who should receive the reward for a new idea? Simple – the first person to apply for the patent on it.

3) When you say “and are better able to bring it to market”, are you saying that only big corporations should get patents because they have the deep pockets to properly develop, produce, advertise and “bring to market” new ideas? I hope not, because that would probably prevent a ton of innovations from small inventors, which would conflict with your desire to NOT “hold back” innovation. So then, how can a small inventor benifit from his new idea, but doesn’t have the bank account to hire employees, rent an office and spend a ton to promote and bring it to market? Simple – license the invention.

4) You then said “…the patent holder is holding back innovation” – Now here is where I belive the difference between benifit and innovation comes into play. If an idea is very innovative, great. But if it’s not very benifcial to anyone, then it’s really not worth much. But, if a a new idea would benifit many people, then the market would be willing to pay a certain amount for that benifit. This is where the “license” price becomes self-regulated. If the license price is too high, then no one will license the invention. But, the inventor filed a patent so he can make money on his invention, so if no one is buying his license because it is priced too high, then if he/she has any brain, they will lower their price to a point that the market accepts and then everyone is happy. Result – no hold back of innovation. But, if you feel that having to pay *anything* for an idea (that someone else would have though of given enough time) is holding back innovation, then the only solution to that is doing away with the patent system entirely. But, then that might also hold back innovation because there will no longer be a big incentive for anyone to come up with new ideas.

Just another inventor voicing my thoughts on this issue…

Mike (profile) says:

Re: No Subject Given

Interesting points. Some quick responses…

1. Ok. We’re agreed. That one was easy. 🙂

2. You’re right to think that this would wipe out a lot of patents. However, I’m curious how you think it’s fair for a company to have a monopoly right over an idea that someone else comes up with independently? I can agree with you if there’s evidence that someone used the idea from within a patent and used that to do something… but if the idea was developed entirely independently, what’s the real value in rewarding whoever filed first (especially when first may not be better)?

3. Actually, quite the opposite. It seems like, these days, it’s often the smaller, more nimble companies, who are better able to bring ideas to market in innovative ways. And, by the way, nothing I’m talking about precludes the idea of licensing. Instead of “licensing” though, it may be looked upon more like “hiring” whoever came up with the idea to help a different company bring it to market.

4. Your points all sound good in theory but aren’t reflected in reality. What’s actually happening is that companies who have patents on ideas that are obvious are more or less extorting money out of those who are actually bringing them to market in innovative ways.

So, as you say, let the market decide and let it self-regulate. If you can build a business case for your invention the market will come to you. If you can’t, let someone else do it. However, allowing the first person to come up with an idea to put up tollbooths because he or she can’t figure out how to actually bring the product to market seems unnecessarily harmful to those who can bring it to market.

John says:

Re: Re: No Subject Given

Hey Mike,

I just want to elaborate some more on a few issues…

1) Basically, I feel the real debate with the patent system lies in whether or not they are properly determining if an idea is an “obvious” idea (to someone in the same field of the invention, based on the current knowledge in that field at the time of the invention).

For example, everyone knows that crazy glue sticks to your skin like there’s no tomorrow. But does it have an “obvious” use to a crime scene detective? Initially, the answer was no. But someone discovered that if you vaporize crazy glue (by heating it up in a chamber), it will stick to the skin fragments of a finger print and make it more pronounced. So hard to see fingerprints then become much easier to see and capture.

So, in your view, does the guy who figured this out deserve a patent on this idea? There was already a method to enhance fingerprints (using the fine powder and brush), and everyone already knew that crazy glue loves to stick to skin. So, could someone claim that this is an obvious solution, given the knowledge of these two facts? I say NO, and here’s why I think this is NOT an “obvious” idea, and thus is patentable…

If, years ago (before this technique was known), I walked up to a crime scene detective who was having trouble getting a fingerprint, and even gave him a stick of crazy glue and said “this will help you”. I feel he would still have no clue how to use the crazy glue to enhance the fingerprint. Thus, heating the crazy clue in a chamber with the fingerprint would NOT have been an “obvious” thought to him or any other CS detective for that matter. Thus, it should be patentable, even though there is a very good chance that someone else would have eventually and *independently* made this discovery.

I think a good test to determine if an idea is obvious or not is to present the problem (that the invention solves) to someone that is knowledgeable in the field relating to the problem (without showing them the patent’s solution), and ask them to come up with various ideas to solve the problem that the invention solves. If none of his ideas comes close the the invention, then wouldn’t that be a good indication that it’s not an “obvious” idea?

2) This topic has a few aspects:

a) In my first post, I tried to convey that I feel virtually any idea will *eventually* be thought of *independently* by someone else in the same “field of expertise”, given enough time and a need/benefit for the idea. So, considering this, wouldn’t it be kinda impossible for anyone to ever come up with an idea that no one will *ever* think of independently, given enough time?

So, would you then agree that it’s not very practical to decide if an idea is patentable on this basis, because every idea will eventually be *independently* thought up by someone else given enough time, so why bother patenting any idea?

b) Being that issued patents, and even patent applications (since 2000) are easily viewable on the internet, how would you ever be able to positively prove that you created an idea *independently* of another inventor? Who’s to say that you didn’t just take a peek at the other inventor’s application, and then make a slight modification to it so it wouldn’t be such a blatant copy of the first patent? You can’t. The only reasonable way to determine who really thought up an idea is to base it on who filed for the patent first. Every inventor has the responsibility to be diligent in pursuing a patent for their invention if they wish to preserve their rights to it. It’s a simple rule….You snooze, you loose. If you don’t agree that the first person to think of an invention deserves to benefit financially on that invention, then you don’t believe in the only reason why there is a patent system in the first place.

Also, you can’t actually patent an idea, you can only patent how that idea is implemented. So, if someone truly did *independently* think of an invention that solves the same problem (or provides the same benefit) as another invention, then there is still a possibility that the second inventor can also get a patent for their invention as well, as long as the implementation is different and not an obvious change to the first patent.

3) I am a little confused about your comment of “it may be looked upon more like “hiring” whoever came up with the idea to help a different company bring it to market”. For example, lets say I sell my patent to a “holding company” so I will get one lump sum for my invention instead of dealing with a bunch of licensees for many years. Wouldn’t these “patent holding companies” then simply be companies that other companies need to “hire” to produce the idea? Just like recording artists sign a contract with a label company, then the label company sells rights of the songs to ITunes, who then sells the songs to end-users.

4) When you say “If you can’t, let someone else do it.”, I agree with this statement as long as you are also saying that I am entitled to receiving licensing fees from the “other” company that takes my idea to the market. However, if you are saying that if I don’t have the proper resources to bring my invention to market, that I should forfeit my rights for the idea to another company, then I totally disagree. In my previous post, I just exaggerated when I used the phrase “big corporations” to help make my point clearer. The spirit of my original statement was that even if I were a “more nimble company”, there are still a ton of issues involved to bringing an idea to the market. It would be ridiculous to expect a small independent inventor to be an expert in every aspect required to properly bring an invention to market.

For example, lets say I own a car repair center, and I discovered that if a certain part of an engine is shaped in a different way, it will increase the fuel efficiency by 30%. So, do I have the bank account to start manufacturing engines with my new design? Of course not. But, going by your statement, it sounds like you are saying that if I don’t have the money to produce the engines, I should just give away my invention to some other company that can, without any financial gain. If that’s what you are saying, then that’s just crazy because it would kill innovation from independent inventors because what incentive would they have to come up with new ideas if they have to then give it away to someone else without any gain? Now that wouldn’t be fair! And it may not be financial reasons why I can’t “take it to market”. For example…lets say I thought up some really cool lyrics for a new song, but I can’t sing for beans…are you saying that since I don’t have the talent to sing, I have to give away all my lyrics to someone else who can turn it into a song? Of course not. But, if agree that I would be entitled to license fees for my invention from the company that brings it to market, then why would you call this extortion or be “unnecessarily harmful”?

In closing, I just want to say that I have been reading your techdirt posts for quite some time, and I really enjoy them. However, I have to be honest…..every time I read your comments related to patents, I consistently felt like your views were anti-independent inventor, and more like “only companies who have the money to bring an idea to market should be granted a patent”. I feel this isn’t so, because for innovation to flourish, we independent inventors should also have an incentive to keep thinking up ideas. And even though we may not have the money and/or expertise to fully bring our idea to market, we should at least be allowed to gain from our ideas by licensing them to a companies that can bring it to market.

Mike (profile) says:

Re: Re: Re: No Subject Given

Interesting points. Thank you for bringing them up. I should clarify my position, and my language may have been a bit messy, which I apologize for.

I’m not against the independent inventor at all. However, I do question why the independent inventor who cannot bring his or her product to market deserves so much credit for a product they can’t bring to market. We have a great financial system in place that helps people with good ideas get capital and expertise necessary to turn ideas into products.

Ideas alone are pretty worthless, because you never really know how valuable they’ll be as products. So, I don’t believe that rewarding just the idea alone makes sense. If the idea is good, then the inventor should be able to make a business out of it, and will get their payout that way.

As for the idea that it’s the responsibility of someone who comes up with an idea to file a patent, that’s hogwash. What if that person only cares about bringing the product to market, and would rather spend the money doing so, instead of giving it to lawyers to patent? Then someone else comes along and patents the idea later, and suddenly they can hold the original product — the one that’s actually going to market — for ransom. That’s hardly encouragin innovation. It’s encouraging lawyers’ fees.

John says:

Re: Re: Re:2 No Subject Given

Hey Mike,

I would think that 99% of independent inventors are like scientists, they are good at thinking up solutions to problems, but know beans about successfully running a business. Even if the “innovative” (idea) part was removed from the equation, it is still extremely difficult to get funding or building *ANY* business for that matter. Thats probably why most small businesses fail in the first year. So, if your opinion is that only entities that can “successfully” bring an idea to market should deserve a patent, then you have to realize you are ruling out 99% of independent inventors.

“then the inventor should be able to make a business out of it”….well licensing is a well establish business model – virtually all music, movies and software are based on this model. So, why should an independent inventor, who doesn’t have the resources to bring their idea to market, be prevented from making money by licensing their idea instead?

When I made the statement “has the responsibility to get a patent”, I meant that if they want to preserve their “profitable” rights to an idea, they need to file a patent. But, if someone comes up with an idea, but doesn’t want exclusive rights to it, then they alternatively have the responsibility to publicly document their idea ASAP so as to create a proper “Prior Art” time marker, which will prevent anyone else from making a claim on the idea. If someone comes up with an idea, but keeps it to themselves, then they didn’t properly protect their idea, and they really have no right to complain if someone else *independently* thinks up the idea and patents it.

Mike (profile) says:

Re: Re: Re:3 No Subject Given

I would think that 99% of independent inventors are like scientists, they are good at thinking up solutions to problems, but know beans about successfully running a business. Even if the “innovative” (idea) part was removed from the equation, it is still extremely difficult to get funding or building *ANY* business for that matter. Thats probably why most small businesses fail in the first year. So, if your opinion is that only entities that can “successfully” bring an idea to market should deserve a patent, then you have to realize you are ruling out 99% of independent inventors.

See, this makes no sense to me. You’re saying that we should reward people who can’t prove their idea is valid. That doesn’t move the economy forward. It moves it backwards.

If the independent inventor is no good at commercializing his ideas, then he needs to find someone who is, and partner with them. Yes, it’s difficult to start a business, and that’s exactly why what I’m saying makes sense. You’re granting monopoly rights to people who haven’t shown that their idea is actually valuable and your punishing the people who commercialize it. Those are the people who work hard to prove that an idea is valuable.

Again, an independent inventor can go out and license ideas if he or she wants. I wasn’t saying they shouldn’t be allowed to do that. But giving them exclusive rights to an idea — especially when others appear to be coming up with it independently is a serious ball and chain on innovation.

The value to society is not in the invention, but in bringing it to market in a successful way. Yet, the “inventor” gets the monopoly rights without proving that the product deserves anything. It’s a drag on innovation.

And, the idea that the only way to have “profitable” rights is to patent it is laughable. There were no profitable businesses before there were patents? As for your claim that those who don’t file for a patent have a responsibility to make their invention public for prior art purposes — again, what’s with the “responsibility.” What about companies who prefer to keep things quiet as a trade secret?

And, I agree, those people don’t have a right to complain… but if they can take it to market successfully, then why would they complain? It’s all about being able to commercialize an idea, and that should have little to nothing to do with patents.

As for the comparison to the music, movie and software industry — it should be clear by now that those business models are falling apart for the very reasons I’m describing here. There’s simply no reason to grant a monopoly to these providers.

John says:

Re: Re: Re:4 No Subject Given

Hey Mike,

Basically, I understand what you are saying. But your opinion seems to equate to “whoever can do the best job to commercialize an idea should benefit the most from that idea”.

Since big corporations have much more money then a small entity (small business or independent inventor) has, wouldn’t they almost always be able to out-market and

commercialize any idea better then a small entity?

Do you now understand why your view on this issue would actually hinder innovation? Because it will effectively discourage small entities from inventing because there will be no

incentive to do so, because they will never be able to commercialize an idea better then the big boys.

“then he needs to find someone who is, and partner with them.” Again, this view favors big companies, because they already have the required resources in-house to bring a

product to market, resources that a small entity will have a hard time securing, if at all.

Also, what’s to stop a big business from just sitting back and waiting for an invention of some small entity to reach a particular threshold in sales. Then, the big company comes

along and copies the invention and out-markets the small entity. In your view, does the big company then have the right to take the patent away from the small entity because it is doing a better job of commercializing the idea?

There will always be someone that could commercialize an idea better then someone else. So, what would be the incentive for anyone to innovate, if someone else could come along and steal it from you just because they have more resources to commercialize it better then you?

Mike (profile) says:

Re: Re: Re:5 No Subject Given

As I’ve stated already, that’s not the case at all. Just look at how many big companies are easily out marketed and out-maneuvered by smaller companies. Big companies are slow, and don’t do a good job recognizing markets. Smaller companies can be more innovative and take more risks to establish themselves.

Startup Amazon beat the pants off Barnes and Noble online and it wasn’t because of their patents. Google blasted past “big company” Yahoo with a better offering and better marketing.

So, no, I fail to see how small companies will always be wiped out by bigger companies. In many ways, it seems like smaller companies with fresh ideas have a huge advantage.

As for your other question, yes, if a company (big or small) can do a better job commercializing a product, then GOOD FOR THEM. That’s COMPETITION, which is what drives the economy. It drives everyone to be better.

John says:

Re: Re: Re:6 No Subject Given


We’re starting to get into the realm of semantics…

Basically, it seems like you just don’t support a patent system at all, because you believe that any idea should be free to be commercialized by any third-party without any compensation to the inventor of the idea, even if that idea was non-obvious.

That’s OK. At least we got to the root of the issue 🙂

Chip Venters (user link) says:

Re: Re: Re:6 Good blog...but obviously no experience in busines

Your comments about competition from small companies against large unfortunately show that you have no real experience at what that is all about. You write a great blog, and I will always read it…but you obviously have no real world experience in the technology business. You views remind me of what Adam Smith might have said about patents and competition if his head was planted in the sand as technology and the world passed him by…maybe a stint as the marketing director of a small under-financed tech company with legitimate patents competing against the big guys might wake you up to the real world.


John says:

Re: Re: Re:2 No Subject Given

I forgot this…

“I don’t believe that rewarding just the idea alone makes sense”

…well it’s not the responsibility or goal of the patent system to determine how much someone should be rewarded for their idea….the market will determine that.

The patent system’s *only* objective is to determine who has the rights to an idea.

It would be crazy to think that the patent system should also determine if an inventor is properly bringing an idea to the market or not.

Ivan Sick says:

Re: Re: Re:3 No Subject Given

Great discussion. I agree with you John, but as I have seen it, Mike’s ideas on the patent issues come from bullshit patents (like online fundraising or online auctions) getting granted. Things like that really shouldn’t be allowed a patent. The question, of course is where to draw the line, and who gets to decide.

Chip Venters (user link) says:

Re: No Subject Given

Completely agree with this post. There seems to be a bias against patents because for the most part, large companies own all of them. The occasional small company that actually invents something unique and actually has the money to go through the expensive and lengthy process of patenting the invention needs the protection even more, because otherwise the large companies would simply take the idea. Many times the money required to get the patent takes away the resources to actually take an invention to market…thus the need for a licensing mechanism. Many “patent trolls” are legitimate inventors and holders of important patents that simply cannot raise the money to go to market….but they still deserve the market value, which translates into a license fee, that the invention might bring. Without patents, the very entities that Mike abhors would just run roughshod over the rest of us. Instead of continuing to invent new software, I guess I would get a job flipping burgers.

Lawrence B. Ebert says:

Patent reform

In the U.S. patent system, a “right to exclude” for a limited period is granted for disclosure of an invention that meets legal requirements (e.g., novel, useful, nonobvious, enabled). There is no defense of independent creation; the person who invents first and files obtains the patent. If not so, people would not be motivated to make public what they have discovered. If this creates a race to the patent office, it is not necessarily a bad thing, because the public gets the information faster.

The U.S. patent system is not about commercialization of inventions. Most issued patents (> 90%) are never commercialized. The patent system is about getting useful information to the public. It’s up to businessmen to properly value inventions, and based on this analysis, to make deals or not make deals.

See also, Lawrence B. Ebert, Patent Reform 2005: Sound and Fury Signifying What?, New Jersey Law Journal (July 18, 2005).

Mike (profile) says:

Re: Patent reform

Indeed. I agree that the patent system isn’t about commercialization. I didn’t mean to imply that I did. My point was that it *should* be.

The problem is that it’s not the ideas that move the economy forward, but the commercialization of ideas. So that’s what we should be encouraging — and the current patent system does not successfully do that.

Anonymous Coward says:

Re: Re: Patent reform

So, I guess…

1) We agree that the patent office needs to keep an eye of what they consider obvious or not.

2) …And maybe it wouldn’t hurt to also just look at the patent office as a big blog that describes new ideas that are available for licensing. Then, it’s up to various businesses to choose one to bring to market, and work out compensation with the inventor.

Lawrence B. Ebert says:

Re: Re: Patent reform

The whole deal with the patent system is to encourage an inventor to reveal information in return for a promise that the inventor can exclude others from practicing that information for a limited period of time.
The Patent Office checks to see that the invention “works” (it is enabled), that it is useful, that it is new, and that it is not obvious over prior work. The Patent Office does not check to see that the invention can be commercialized. That is a job for businessmen. We don’t want government involved in economic decisions in a free economy. We don’t want the Patent Office to be involved in making decisions about commercialization.
Yes, commercialization of ideas moves the economy forward. And we want businessmen, not the government, to do that.
The current patent “reform” bill (H.R. 2795) attempts to weaken the position of inventors. Stripping the power of the injunction hurts the bargaining position of inventors trying to market their idea. Creating an opposition proceeding (in addition to the already present options of re-examination and litigation) makes it harder to enforce patents. Generally, the reform bill strengthens those who have developed patents on sustaining technology, and will not help those presenting breakthrough technology, which, if commercialized, will move the economy forward.

Mark Goodell says:


I think that patent law as it stands today is unconstitutional, because the constitution says that the granting of these monopolies is to advance progress, whereas you do not have to be a genius to realize that the present system retards progress.
Rewarding innovation is a good idea, but not with monopoly, because that retards innovation.
Thank you.

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