You may remember that right before Facebook was set to go public, Yahoo decided to threaten and then sue Facebook over some patents -- in a move that was widely mocked, especially among engineers and technologists in Silicon Valley about just how far Yahoo had sunk. Yahoo's been struggling to regain any sense of being a place where actual innovators want to work ever since. It would appear that the folks at IBM didn't get the message. They apparently waited until the eve of Twitter's IPO to try the same strategy: threatening to sue Twitter for patent infringement over three very broad patents that never should have been granted in the first place.
6,957,224: Efficient retrieval of uniform resource locators
7,072,849: Method for presenting advertising in an interactive service
7,099,862: Programmatic discovery of common contacts
In recent years, IBM has, at times, pretended to support real patent reform, but its actions speak louder than words. It's been acting very much like a patent troll, making efforts to block real patent reform, while using its patents as weapons against companies much more innovative than IBM. It truly is living up to the old adage about how young companies innovate, while old companies litigate. Sad legacy it's leaving.
Meanwhile, the company they're targeting, Twitter, not only has built a service that so many people find useful (when has IBM done that?), but also has made it clear that it won't be able to do what IBM is now doing, by giving anyone who gets a patent while employed by Twitter the ability to block the patent from being used as a weapon against others -- something that actually has helped attract numerous engineers to Twitter, since they want to work for innovative companies which actually innovate in technology, rather than abuse the legal system to shake down others.
We recently posted about an absolutely ridiculous NY Times op-ed piece in which Pat Choate argued both that patent laws have been getting weaker, and that if we had today's patent laws in the 1970s that Apple and Microsoft wouldn't have survived since bigger companies would just copy what they were doing and put them out of business. We noted that this was completely laughable to anyone who knew the actual history. A day or so ago, someone (and forgive me, because I can no longer find the tweet) pointed me on Twitter to a 45 minute excerpt from a documentary about the early days of Microsoft and Apple and it's worth watching just to show how laughably wrong Choate obviously is.
There are two key themes that stand out incredibly strongly in this: both Microsoft and Apple did an awful lot of what they did by shamelessly copying the work of others, and the big companies floating around the space (mainly IBM and Xerox) clearly had no clue at all about what was going on. The few times they discovered interesting things, they didn't know what to do with them, and let Microsoft and Apple walk all over them to build something better that people wanted. And when they tried to jump into these markets by copying the work of Apple and Microsoft, they tended to do a really bad job of it. On the copying front, while most people are familiar with Apple copying the GUI from Xerox, less well known is the story of Tim Patterson at Seattle Computer Products reverse engineering CP/M based on understanding CP/M's APIs to create the early versions of DOS that Microsoft licensed to IBM.
Also noteworthy: no discussion of patents at all. At the very end of the clip there's a bit of a discussion from former Apple CEO John Sculley concerning Apple's legal fight with Microsoft over the look and feel of the GUI. He mentions there was nothing patentable, but that they felt it was a copyright violation. However, he also notes that Apple's strong belief that they could stop Microsoft via copyright also led to complacency within Apple, and less focus on competing by innovation.
In other words, the claims Choate makes are laughable. There was little to no reliance on patents during the early days, and a very strong culture of copying anything and everything, while competing by trying to out-innovate each other. Furthermore, big companies couldn't figure out what was going on, even if they wanted to copy these successful upstarts. At one point, Larry Ellison jokes about how IBM stupidly ceded the chip market to Intel and the OS/application market to Microsoft when it could have owned it all.
One point about the video. The YouTube link says this is from the "documentary" Pirates of Silicon Valley. That's incorrect. If I remember correctly, Pirates of Silicon Valley was actually a "TV movie" based on the same subject material, with Noah Wylie playing Steve Jobs and Anthony Michael Hall playing Bill Gates. Instead, I'm pretty sure that the clips are actually from the documentary Triumph of the Nerds, put together and narrated by Mark Stephens, who is better known as Robert X. Cringely (there's another interesting historical story about the legal fight over the Cringely name, but that's a totally different tangent). This documentary actually came out in 1996, so it's interesting to see how it mostly predates the internet (though there is some discussion of the internet), Jobs' return to Apple and a variety of other things that happened over the past 15 years. Either way, it should put to rest Choate's silly claims.
Nearly two years ago, we took part in a wider discussion over the question of why there was no billion dollar pure play open source company. Much of the discussion, not surprisingly, focused on Red Hat, seeing as it's the largest of the pure play open source companies, and some had been complaining that it had not yet reached $1 billion in revenue, even as proprietary software players were able to earn much more than that. We highlighted, first, that a direct comparison didn't make any sense, because the business models were so different. The very nature of a company like Red Hat is to shrink the costs one has to pay, such that the market is redefined. Quoting Red Hat's CEO speaking to Glyn Moody:
He said that he did think that Red Hat could get to $5 billion in due course, but that this entailed "replacing $50 billion of revenue" currently enjoyed by other computer companies. What he meant was that to attain that $5 billion of revenue Red Hat would have to displace software that currently costs $50 billion. Selling $50 billion-worth of software -- even if it only costs $5 billion -- is somewhat hard, which is why it will take a while to achieve.
And that's a key point. The markets are very different. But I think there was an even more important point later on in that discussion, which is that it's wrong to think of just "pure play" open source companies as the open source market. It's really the equivalent of defining "the music industry" as solely "the number of CDs sold." That doesn't paint the entire picture at all. Because, as we've seen, as music has become more available (both in authorized and unauthorized means), it's built up the much wider "music industry" in massive ways -- jump-starting huge shifts in the industry.
Similarly, the importance and impact of the "open source market" is not in the companies offering up open source software, but in the companies using open source software to offer amazing things to the world. In other words, I'd argue that companies like IBM, Google and Facebook are clearly "billion dollar open source companies" (actually, much, much more than just a billion) -- because they all use open source software as the key component and key resource in building their business. Just as other parts of the music business used free music to boost their revenue, companies that used open source software built massive new markets and grew their own revenue streams.
Given that, I know there's a lot of folks talking about Red Hat finally actually hitting that $1 billion revenue milestone -- and it is a milestone worth noting. However, I think it's wrong to suggest that Red Hat is therefore the first "billion dollar" open source company. In fact, just as IBM, Facebook and Google really make their money by leveraging open source software to do (and sell) something else, much of Red Hat's revenue really comes in an ancillary manner to the software as well: from selling the service that goes with it. It's great that Red Hat is doing well, and certainly it presents yet another useful data point to argue against those who argue there's no money to be made if your key "product" is free, but I think it's unfair and misleading to claim that it's the first billion dollar open source company.
Today is the final game of Jeopardy! where the IBM supercomputer Watson plays against two of the best human players to ever compete on the show. Folks on the East Coast already know the outcome by now, so feel free to ruin the suspense in the comments below for those of us in later time zones. But whatever the outcome, Watson's performance has been pretty interesting to watch. And let's hope these supercomputers don't start playing thermonuclear war any time soon. In the meantime, here are some links on AI beating humans at other games and tests.
In April of 2009, we wrote about how IBM was working on a new computer, called Watson, that would be able to compete on the game show Jeopardy. It was no chess playing computer, but it was still an interesting project. Apparently, it's advanced enough that it's scheduled for its first appearance on the show, this upcoming February (Valentines Day -- so romantic), where it will take on two of the most successful Jeopardy contestants ever. While it might seem simple -- you just have to load up the machine with a ton of trivia -- it's a bit more complicated than that, because the Jeopardy "clues," can be a bit tricky, often using "subtle meanings and riddles." Apparently, those things have still been stumping Watson in testing. The report notes: "Watson had some trouble recognizing double meanings and sometimes confused fiction as fact." In other words, this actually is an attempt to push computer natural language recognition tools forward.