JANET RAE-DUPREE has a thought-provoking piece entitled "For Innovators, There Is Brainpower in Numbers" link here. She begins, "Despite the enduring myth of the lone genius, innovation does not take place in isolation. Truly productive invention requires the meeting of minds from myriad perspectives, even if the innovators themselves don't always realize it." She goes on to examine how individuals work together successfully in groups with some examples, but it led me to speculate on what this means for promoting innovation in another sense. Since what we want is innovation, policy on IP needs to accomodate to this perception. Much innovation seems to come from large companies with the resources to devote to it. They would, I expect, prefer less regulation, such as that coming from the copyright and patent laws which fence in what they can do.

That may be wrong, however. Instead, one might argue that the really large companies with lots of patents have accomodated to the IP regime. They can cross license and largely avoid any limits on their own activities. Large companies may even find a cross-licensing regime preferable, by limiting competition. IP-based oligopoly would then be preferred to open competition.

But that bars a large number of potential innovators, whether as individuals or small groups, from doing so. In the long run we see innovation reduced or slowed. The social cost of this regime is enormous, bad for consumers and more broadly, for humanity.

Interesting that you should say that innovation will be reduced or slowed. Except, that seems impossible. If innovation was truly reduced for the inventions of 17 years ago (filed approximately 20 years ago), then as the patents expire on those inventions, innovation should explode. Yes, innovation on the new invention will be somewhat delayed (except for the company with the invention and licensees), but there is always one more new invention for whom the patents have expired.

Invention sparks innovation, and invention remains powerful among individual inventors - for whom there is no outlet without patents (these are the people who sit in their garage making things and patenting them; they do not write scientific papers or in journals). Since these same people rarely pay for the second maintenance fee on their patents, they expire about nine years or so after issuance, providing even more fodder for innovation.

I suspect innovation is never starved because of patents, only time shifted. In the meantime, other inventions are launched because of exposed and issued patents, also awaiting the day when their turn in the unrestricted innovation pool occurs.

I would like to know how a "social cost" could be measured, if it even exists. Humanity has had inventor protection in various forms for more than a couple of millenia, and formal patent protection for more than a couple of centuries, and yet we will have more new knowledge in the next two years than all the knowledge generated since the beginning of recorded history. New inventions continue to increase at an incredible rate. The technologies that new college students will work on when they graduate does not even exist yet. We are moving so fast that the number of educated people to work these new technologies are unavailable, leading to shortfalls of specialists. If patents are truly harming the advancement of society, then we should have thousands of technical experts with nothing to do, but we do not.

As usual, Lonnie is mistaken. In this instance, the most egregious error is here:

"I suspect innovation is never starved because of patents, only time shifted."

The problem is that inventions build upon earlier inventions. So if A is delayed by ten years, and B depends on A, B gets delayed 10 years. If B gets delayed another 10 years waiting for some patents to expire, B gets delayed a total of 20 years. C gets delayed 30, D 40, and so on, and so forth.

It's clear from the growing time intervals from A to B to C to D that innovation is slowing down in this scenario.

Patents therefore might not merely slow innovation, but actually slow it more and more as time passes.

Even if not, innovation is frequently a synergistic thing, so the effects of a delay can be exponentiated.

And even ten years can be too long to wait for someone in dire need of, say, a cutting-edge medical treatment. Depending on what's wrong with them, ten months may be too long, or ten days, or ten hours, or ten minutes, or even ten seconds.

As for the numerous other errors:

* The lone inventor in his garage whose main output is patents is basically a myth. Real garage inventors are often entrepreneurs -- they get some VC and start up and startup to actually make and market something.

* It is not true that "there is no outlet without patents".

* Innovation "should explode" when patents run out only if it's not still held back by other, more recent patents that have yet to expire.

* Plus plenty of straw-man arguments, arguments that use one of the above erroneous claims as premises, and other problematical claims.

Nobody Nowhere:

The problem is that inventions build upon earlier inventions. So if A is delayed by ten years, and B depends on A, B gets delayed 10 years. If B gets delayed another 10 years waiting for some patents to expire, B gets delayed a total of 20 years. C gets delayed 30, D 40, and so on, and so forth.

I am clueless as to why anyone would wait any length of time after patents issue to build on the original invention. That statement is contrary to what the Japanese have done and it is contrary to what my companies have done.

Traditionally, we monitor new publications (applications that are being or will be examined) and determine one of several things:

o Is the invention relevant to our product?

o Would we be interested in having a similar feature? If so, we immediately develop an alternative design for our products that avoids the first application.

o Even if we are not interested in the design, do we see an improvement that might be valuable to the competitor? If so, we create the design and file a patent application, if appropriate.

Note that we DO NOT WAIT TEN YEARS, or even ONE YEAR, or even ONE MONTH. We have to act or be left behind. Indeed, patent applications spur us to invent (or innovate) where we might not otherwise have spent time, speeding up the invention/innovation process.

So, from my point of view, my statement is correct. Your comments regarding my errors and delays appear to be theoretical or from some perspective contrary to my working experience.

As for the numerous other errors:

* The lone inventor in his garage whose main output is patents is basically a myth. Real garage inventors are often entrepreneurs -- they get some VC and start up and startup to actually make and market something.

Do you have even one fact to back this up? I have seen a number of studies that estimate that 80 to 90% of all patents never find their way into a product. Now, I am unable to separate those patents that are for large companies versus individual inventors, but I have been in blogs populated by individual inventors, and the common theme is the difficulty of marketing their products. Therefore, I have to believe that individual inventors are no better at marketing than larger companies, so 80 to 90% of patents from individual inventors (perhaps more) never see the light of day.

* It is not true that "there is no outlet without patents".

Did I say "there is no outlet without patents" or did I say that many and probably the vast majority of these inventions would never see the light of day without patents?

Something else to keep in mind is that, as has been pointed out many times, is that secrecy is considered the best alternative to patents. Eliminate patents and secrecy will increase, decreasing the use of other outlets.

So, yes, there are other outlets, but I would guess, based on the number of inventions that never see the light of day, that 80 to 90% of all inventions would not be revealed without patents.

* Innovation "should explode" when patents run out only if it's not still held back by other, more recent patents that have yet to expire.

Patent A expires and innovation can proceed. However, I segregate innovation just like Mike Masnick does. Innovation is successfully bringing a product to market, and has little, if anything, to do with invention. Invention is a continuous process that happens even on patented products, by competitors. Innovation is a separate process that has little to do with invention and patents and a lot to do with packaging.

* Plus plenty of straw-man arguments, arguments that use one of the above erroneous claims as premises, and other problematical claims.

My claims are only erroneous when you back up your comments with facts. However, I saw only assertions and claims, and not one fact.

> that 80 to 90% of all inventions would not be revealed without patents

And there lies the hypocrisy of the pro-IP argument. All pro-IP folks always complain that their precious inventions would be stolen without monopolies. According to your post, that's obviously not true for the vast majority of them if 80 to 90% would never be revealed. So, why do we need monopolistic laws when inventors can do that themselves anyway?

The burden of proof is always on pro-IP camp, simply because special protectionist laws are in force _already_ that are supposedly required. They need to prove to the rest of us that we really need them in order to have progress. These people had a few hundred years to make their case - do they have one? Otherwise, why bother?

Jimbo:

...that 80 to 90% of all inventions would not be revealed without patents

And there lies the hypocrisy of the pro-IP argument. All pro-IP folks always complain that their precious inventions would be stolen without monopolies. According to your post, that's obviously not true for the vast majority of them if 80 to 90% would never be revealed. So, why do we need monopolistic laws when inventors can do that themselves anyway?

What is the point of your post? Let me restate my point:

o The value of any invention to society is when it is revealed, because revealing the invention permits other inventions (and innovation) to build on that invention.

o Patents provide an incentive to reveal, regardless of whether the product ever makes it into production.

o Perhaps 80% to 90% of all inventions never make it into production. Without patents, many of those inventions, and perhaps most, which are currently revealed by way of a patent, would not be revealed to the world.

The burden of proof is always on pro-IP camp, simply because special protectionist laws are in force _already_ that are supposedly required.

I think you have that a little backward. The burden of proof is on the anti-IP camp, because we have a system and invention and innovation has accelerated exponentially. Indeed, invention and innovation was happening so fast that we no longer had the technical people to keep up. So, YOU would have to prove that elimination of IP would increase invention and innovation at an even greater exponential rate.

They need to prove to the rest of us that we really need them in order to have progress.

Why does 90% of the population have to prove anything to 10% of the population?

These people had a few hundred years to make their case - do they have one?

Seems to me that the numerous studies that show the benefit of patents to the establishment of new industries and for capital and research intensive industries are the case. Have you been paying attention?

> The value of any invention to society is when it is revealed, because revealing the invention permits other inventions (and innovation) to build on that invention.

Nonsense. The value of invention to society is that goods are getting better and cheaper. The pro-IP camp _assume_ that these inventions need to be revealed in order for this to happen (that is the rationalisation served to all of us, all the time). That's why we have these monopolistic laws, so that a few in the position of power can exploit this assumption and jack up the prices. But people are not stupid, they can work things out once they see them. And so they would the innovations.

> The burden of proof is on the anti-IP camp, because we have a system and invention and innovation has accelerated exponentially.

Yeah, that's why open source folks are not legally allowed to ship perfectly good MP3 implementations, they wrote themselves. And that's why Theora/Ogg had to be invented to _avoid_ the supposedly usable invention. Please, spare us the nonsense about exponential innovation. The patent system is nothing but oligarchy in action.

> So, YOU would have to prove that elimination of IP would increase invention and innovation at an even greater exponential rate.

You mean all the time before the last few hundred years is not enough?

> Seems to me that the numerous studies that show the benefit of patents to the establishment of new industries and for capital and research intensive industries are the case. Have you been paying attention?

Have you? Studies that show how many patents (out of which 90% will never be used) have been filed do not show "innovation". They just show how much more money you and I spend on goods.

Study the case of Red Hat. Their product can be (and was) copied by everyone, including a big multinational like Oracle. Impact on Red Hat? Zero or close to it. Why? Because no matter what these other players do, unless they get the same amount of knowledgeable people to support the product with the same enthusiasm, they will not succeed. And that is called competition. The foundation of capitalism.

Jimbo:

The value of any invention to society is when it is revealed, because revealing the invention permits other inventions (and innovation) to build on that invention.

Nonsense. The value of invention to society is that goods are getting better and cheaper.

Oh, I see. So new inventions have no value, but making existing goods better and cheaper has value. Erroneous logic. I would rather have affordable, fast transportion than a highly refined horse and buggy. It took tens of thousands of inventions, many of which never went into production while their patents were in force, but which formed the basis of other inventions, to get us to where we are today.

The pro-IP camp _assume_ that these inventions need to be revealed in order for this to happen (that is the rationalisation served to all of us, all the time).

Okay, then let us never reveal any invention to the world, and we can all go back to scrabbling in the soil and killing each other with sticks and stones to survive.

That's why we have these monopolistic laws, so that a few in the position of power can exploit this assumption and jack up the prices.

How can "a few in the position of power" (whatever that means) jack up prices when the prices never existed prior to the invention? That makes zero sense.

But people are not stupid, they can work things out once they see them. And so they would the innovations.

Farfle, farfle pippick? Sorry, I have no idea what language this is, but it is unintelligible.

The burden of proof is on the anti-IP camp, because we have a system and invention and innovation has accelerated exponentially.

Yeah, that's why open source folks are not legally allowed to ship perfectly good MP3 implementations, they wrote themselves. And that's why Theora/Ogg had to be invented to _avoid_ the supposedly usable invention. Please, spare us the nonsense about exponential innovation.

Excuse me? Exponential innovation is nonsense? I have no idea what you have been reading and where, but innovation has been increasing exponentially (proven fact, would you like references or are you a big boy and can look them up yourself?).

As for software, I am unable to speak about that. If someone patented MP3 (I am insufficiently knowledgeable about such niche activities), then perhaps the open source people should figure out a better method.

The patent system is nothing but oligarchy in action.

I have no idea why the patent system is an oligarchy. Anyone with a novel invention can get a patent, even you... About 1/3 of all patents are issued to individual inventors (which would be somewhere around 2 million patents or so). A goodly chunk of the remaining 2/3's are issued to small and medium sized businesses. Though I do not have facts, I would guess that about 4 or 5 million of the 7.4 million patents issued in this country went to individual inventors, small and medium businesses. That just does not seem like an oligarchy to me.

So, YOU would have to prove that elimination of IP would increase invention and innovation at an even greater exponential rate.

You mean all the time before the last few hundred years is not enough?

You mean when the rate of invention and innovation was orders of magnitude slower than they are now?

Seems to me that the numerous studies that show the benefit of patents to the establishment of new industries and for capital and research intensive industries are the case. Have you been paying attention?

Have you? Studies that show how many patents (out of which 90% will never be used) have been filed do not show "innovation". They just show how much more money you and I spend on goods.

I never said they did. Neither do they show how much more money you and I spend on goods, if any.

Study the case of Red Hat. Their product can be (and was) copied by everyone, including a big multinational like Oracle. Impact on Red Hat? Zero or close to it. Why? Because no matter what these other players do, unless they get the same amount of knowledgeable people to support the product with the same enthusiasm, they will not succeed. And that is called competition. The foundation of capitalism.

Interesting organization with an interesting business plan. I also notice that Red Hat has about 100 patents and applications.

> Oh, I see. So new inventions have no value, but making existing goods better and cheaper has value. Erroneous logic.

Obviously you have no idea what patents are _supposed_ to be about. With that in mind, what's the point of the rest of the arguments? You don't have to answer this - it's rhetorical.

BTW, nobody said anything about "existing goods". It's about goods getting cheaper and better, which then benefits everyone in society. All goods.

> Sorry, I have no idea what language this is, but it is unintelligible.

I will speak slowly for you then. People are not stupid. They can figure out how something works once they have it in their hand. It is called reverse engineering. The opposite of this is deliberate cooperation, of course (see: open source, for instance).

> I have no idea why the patent system is an oligarchy.

OK, here is an exercise for you. Try designing a new processor. See how far you get without cross-licensing with IBM, Intel and the other oligarchs.

> I also notice that Red Hat has about 100 patents and applications.

Try finding out why that have them and how they are licensed before you comment, OK? Also, try finding out how much it cost them to pay all the lawyers to do all this - none of which will actually benefit anyone.

All we got from this system is more patents - that is not innovation. People innovate because they want to - whether they have monopolies on this or not. And they always find ways of making money on it. The rest is just greed.

> If someone patented MP3 (I am insufficiently knowledgeable about such niche activities), then perhaps the open source people should figure out a better method.

Just one small comment here (it is really sad that you think that MP3 is "niche" - it is literally _everywhere_).

"Figure out a better method." Please! They did. It's called Ogg, but what good is that to the society when the monopolist already cornered the market with the MP3 format? And when you combine this with DMCA, you get? That's right - higher prices for music.

PS. Yeah, I know - we wouldn't be enlightened by the crap produced by the likes of Britney if it weren't for copyright. That would be a real disaster ;-)

Jimbo:

I consider MP3 niche because while it may be "literally everywhere," it is only used on certain types of devices. I have an MP3 player, but rarely use it because the dynamic response of MP3 and the quality of the sound is greatly diminished. I prefer CD's, and, even more, vinyl albums.

"Figure out a better method." Please! They did. It's called Ogg, but what good is that to the society when the monopolist already cornered the market with the MP3 format? And when you combine this with DMCA, you get? That's right - higher prices for music.

PS. Yeah, I know - we wouldn't be enlightened by the crap produced by the likes of Britney if it weren't for copyright. That would be a real disaster ;-)

You are getting into a realm about which I know little, that being copyright and formats. However, one of the purposes of patents was to promote innovation, and if Ogg was invented to avoid MP3 patents, it appeared to have worked.

As for copyrights, I personally think they last too long. When it costs 10 million to 50 million to develop a new engine or transmission, and payback is 3 to 10 years, I can see the value in the life of patents. A song costs maybe $10,000 to $100,000 dollars to record. Even if marketing costs $500,000 (which seems a bit distorted), payback will either happen in months or a couple of years, or it will never happen. I fail to see why copyrights, which are for an item that costs significantly less in terms of labor and up front costs, should last for 70 or 90 years, and patents effectively last for 15 to 17 years.

The cost of music should be whatever the market will bear, while a reasonable length copyright is in effect.

Oh, I see. So new inventions have no value, but making existing goods better and cheaper has value. Erroneous logic.

Obviously you have no idea what patents are _supposed_ to be about. With that in mind, what's the point of the rest of the arguments? You don't have to answer this - it's rhetorical.

BTW, nobody said anything about "existing goods". It's about goods getting cheaper and better, which then benefits everyone in society. All goods.

You said patents "raise costs." Well, you cannot "raise" a cost on a new invention. The cost is what it is, taking into consideration the cost of development and competition from competing products. Any cost will depend on an array of factors, which can include patents, but may not. Some markets will not tolerate a price differential due to patents.

Sorry, I have no idea what language this is, but it is unintelligible.

I will speak slowly for you then. People are not stupid. They can figure out how something works once they have it in their hand. It is called reverse engineering. The opposite of this is deliberate cooperation, of course (see: open source, for instance).

Reverse engineering is not possible for everything. We call those features that cannot be discerned by examining a product "trade secrets."

I have no idea why the patent system is an oligarchy.

OK, here is an exercise for you. Try designing a new processor. See how far you get without cross-licensing with IBM, Intel and the other oligarchs.

Try designing a new transmission. If it is really new, you will be violating no one's patents.

I also notice that Red Hat has about 100 patents and applications.

Try finding out why that have them and how they are licensed before you comment, OK?

You raised the issue of Red Hat. I merely pointed out a fact.

Also, try finding out how much it cost them to pay all the lawyers to do all this - none of which will actually benefit anyone.

The latter point of your sentence is opinion. I have no idea how much they paid lawyers "to do all this." Neither do I care. They made the choice for whatever the reason.

All we got from this system is more patents

Abundant studies show that is not true. I have cited several on this site, would you like more? I am aware of a couple of dozen separate studies that show that patents have benefited the establishment of new industries and businesses. How many would you like?

- that is not innovation.

Patents have little, if anything to do with innovation (as some seem to define it). Indeed, invention has little to do with innovation. On the other hand, without invention, innovation eventually runs out of steam. Innovation is relatively unimportant to me because I read innovation as "I made your product slightly better so I should be entitled to profit from it." Yeah. You could not create, so you act as a parasite.

People innovate because they want to - whether they have monopolies on this or not. And they always find ways of making money on it. The rest is just greed.

Actually, I agree with you on this. People innovate because they want to. However, there are many activities for which innovation will never occur without patents because they are just too darn expensive and payback would never occur without patents. Again, there are dozens of studies that clearly show this is the case - which includes at least a half dozen studies by anti-IP researchers.

As for making money, an imitator will always find it easier to make money than the inventor, because the imitator does not have to make all the mistakes the inventor had to make. So, the imitator may make money, but the inventor may not, and the inventor will realize invention is a losing proposition and stop inventing. Lack of patents has a chilling effect on inventing for certain industries.

> and if Ogg was invented to avoid MP3 patents, it appeared to have worked.

Sorry, but that is far from being true. Every single MP3 player is more expensive because royalty needs to be paid to patent holders. Ergo, we all lose. And, at the same time, people bent on delivering open source had to explicitly go _around_ the patent instead of using the knowledge from it in order to get a similar result (supposed disclosure of knowledge hindered them in their efforts, instead of helping).

> Neither do I care. They made the choice for whatever the reason.

You should - it is a critical distortion of the system in favour of big players. They made a choice for the reasons of MAD (Mutually Assured Destruction). In order words, they are going to be using them for defensive purposes only. Otherwise, they are licensed for free to anyone, as long as they are licensing their software in an open source way. (Note that if a patent troll sues, they will still lose.)

Net gain: negative. Lawyers have been paid, patents filed and inventions would have happened anyhow. End result: you pay more for Red Hat to deliver service to you.

> As for making money, an imitator will always find it easier to make money than the inventor, because the imitator does not have to make all the mistakes the inventor had to make. So, the imitator may make money, but the inventor may not, and the inventor will realize invention is a losing proposition and stop inventing. Lack of patents has a chilling effect on inventing for certain industries.

Everything works both ways. If the imitator avoided mistakes, original inventor is free to copy that in the next iteration and so on. The problem with patents is the one of going out to play with the ball and not letting anyone touch it. Nobody has any fun that way. Only people bent on holding to their ball have some kind of weird pay-off.

> We call those features that cannot be discerned by examining a product "trade secrets."

You mean like Coca-Cola ingredients? That never stopped competition before. And that's what is all about - competition in order to get better goods at cheaper prices, isn't it?

Jesse:

...and if Ogg was invented to avoid MP3 patents, it appeared to have worked.

Sorry, but that is far from being true.

Then why was Ogg invented, if not in an attempt to avoid MP3 patents?

Every single MP3 player is more expensive because royalty needs to be paid to patent holders. Ergo, we all lose.

If you develop your own software, the per player license is 75 cents. It is difficult for me to get alarmed over 75 cents. Furthermore, the average American wastes several times that amount per day in food and energy that could go to help dying Africans (right Cheesewax?). The only difference here is that you object to the royalty, but you do not object to the much easier to control waste.

And, at the same time, people bent on delivering open source had to explicitly go _around_ the patent instead of using the knowledge from it in order to get a similar result (supposed disclosure of knowledge hindered them in their efforts, instead of helping).

I think this is amazing. Let me get this clear. A patent existed on a technology. In order to avoid the patent, a competitor developed new competitive technology? So, the existence of a patent caused progress in the arts. Seems like the MP3 patents did exactly what they were supposed to do.

Neither do I care. They made the choice for whatever the reason.

You should - it is a critical distortion of the system in favour of big players.

I did a quick search. A couple of individual inventors have MP3 patents, along with a couple of European companies I have never heard of along with a couple of larger European companies. I have two problems with your statement. First, about half the MP3 patents are held by smaller companies, and the licensing royalties are set, published and clear. So, "in favour of big players" seems a critical distortion.

Second, how is having MP3 patents a "critical distortion of the system"? MP3 was developed from nothing. It was revealed to the world in patents and developed into encoders and players. I fail to see where anyone strong-armed anyone else to purchase MP3 technology. People were free to develop alternative technology, and have. The only critical distortion I see is how people are exaggerating the effect of patents on a luxury item.

Net gain: negative. Lawyers have been paid, patents filed and inventions would have happened anyhow.

Your fundamental argument, as I have seen many times, is that MP3 would have been invented even if the people that developed MP3 would not have. I also saw someone make the outlandish claim that all inventions are invented simultaneously (meaning more than one person in separate locations invents the same thing at the same time).

Simple response: facts not in evidence.

Would MP3 have been invented, eventually? I have no doubt. It might have happened a year later, five years later, or ten years later. Perhaps it would never have happened at all, and Ogg would have been invented instead. It is impossible to know for sure. What we do know is that patents set a goal line in a race that people may or may not think they are running, but they know there may be a pay off if they can cross that line.

Are some things invented at the same time in separate locations? Yes. Are there a lot of things invented at the same time in separate locations? Probably not. Why do I make this statement? Let us examine USPTO statistics for interferences, which are declared when two entities claimed to have invented the same mechanism at the same time. In FY208, 66 interferences were declared, out of roughly 300,000 patent applications. Hardly seems like many people are simultaneously inventing. Incidentally, these numbers are typical: FY07 - 58, FY06 - 129, FY05 - 94, FY04 - 86, FY03 - 90, FY02 - 109. All statistics from http://www.uspto.gov/web/offices/dcom/bpai/docs/process/index.htm

End result: you pay more for Red Hat to deliver service to you.

Obviously, the amount must be less than 75 cents per player, or they would have licensed MP3.

As for making money, an imitator will always find it easier to make money than the inventor, because the imitator does not have to make all the mistakes the inventor had to make. So, the imitator may make money, but the inventor may not, and the inventor will realize invention is a losing proposition and stop inventing. Lack of patents has a chilling effect on inventing for certain industries.

Everything works both ways. If the imitator avoided mistakes, original inventor is free to copy that in the next iteration and so on. The problem with patents is the one of going out to play with the ball and not letting anyone touch it. Nobody has any fun that way. Only people bent on holding to their ball have some kind of weird pay-off.

The problem is time and money. When a manufacturer pays for an assembly line and tooling, the investment can easily be in the $10 million or $20 million dollar range. So, the inventive company invents a new product, invests $20 million in development, $20 million in more in tooling. Without patents, a competitor examines what the inventive company did, figures out how to avoid their mistakes and spends half as much to bring the product to market. The competitor quickly loses market share and has to make one of two choices: spend millions to modify their tooling or stop making the product. Regardless of the choice they make, lack of patents penalizes the inventive company and rewards the imitator.

We call those features that cannot be discerned by examining a product "trade secrets."

You mean like Coca-Cola ingredients?

Absolutely.

That never stopped competition before. And that's what is all about - competition in order to get better goods at cheaper prices, isn't it

So, you DO understand my point. Yes, Coca-Cola has a trade secret, but that trade secret did NOT stop anyone from developing a different, competing product. Similarly, MP3 does not prevent someone from developing a different competing product. In fact, that was one intent of intellectual property: Reveal invention A and provide a limited right to restrict make, use or sales of that invention in the hope that the example of invention A would spur invention B, expanding choice and knowledge, and generating competition.

Excellent example of the value of IP, Jesse.

Jimbo:

My previous post should have been to you rather than Jesse...sorry about that.

Lonnie

I see Lonnie has been busy again this week, spamming the comments with large numbers of repetitive and sometimes personally-insulting comments, and breaking yet another promise to shut up.

Why has no-one yet seen fit to ban his IP from posting to the site, given his increasingly egregious behavior?

"I am clueless as to why anyone would wait any length of time after patents issue to build on the original invention."

Because they have to wait for the patent to expire, because they're a competitor and the patent-holder either refuses to license the patent to them at all or charges an exorbitant price?

"Note that we DO NOT WAIT TEN YEARS, or even ONE YEAR, or even ONE MONTH. We have to act or be left behind. Indeed, patent applications spur us to invent (or innovate) where we might not otherwise have spent time, speeding up the invention/innovation process."

Pure drivel. Competition would spur you to do so. Patents may hold you back from doing so. Perhaps in some particular instance they failed to do so.

""* The lone inventor in his garage whose main output is patents is basically a myth. Real garage inventors are often entrepreneurs -- they get some VC and start up and startup to actually make and market something."

[calls me a liar]"

No, I am not a liar.

"80 to 90% of all patents never find their way into a product."

What a waste of taxpayer resources.

"I have been in blogs populated by individual inventors, and the common theme is the difficulty of marketing their products."

That will probably always be difficult. Patents don't help. Indeed, they hinder, by forcing them to try to avoid infringing anyone else's and to pay lawyers an arm and a leg both to file for patents themselves and to do patent searches and carry out other CYA actions, which would not be needed absent the climate of extreme liability for even unintentional infringement.

Ultimately, the irreducible difficulties arise from:

* Needing to know how to raise VC, incorporate, and all that other stuff.

* Possibly needing to have the right connections, know the right people, etc. to do all that.

* Needing, usually, to team up with a business-savvy partner.

* Needing to actually raise the investment capital.

* Needing to actually successfully market the product when the time comes.

That last item can sometimes be a doozy.

"Did I say "there is no outlet without patents" or did I say that many and probably the vast majority of these inventions would never see the light of day without patents?"

Either way, you were wrong.

"Something else to keep in mind is that, as has been pointed out many times, is that secrecy is considered the best alternative to patents. Eliminate patents and secrecy will increase, decreasing the use of other outlets."

Secrets get discovered. Once discovered, they are legally fair game. No wait-20-years-or-we-sue-you BS.

"So, yes, there are other outlets, but I would guess, based on the number of inventions that never see the light of day, that 80 to 90% of all inventions would not be revealed without patents."

We've had enough of your 0%-evidence-free, no trans fat guesses.

Prove that, or shut the hell up.

"Patent A expires and innovation can proceed."

Not when Patent B still stands in the way of the same innovation.

"Invention is a continuous process that happens even on patented products, by competitors."

Nonsense. Patents are used as a blunt instrument to forbid competitors from even touching the product.

Regardless, you can't have it both ways. Either patents inhibit innovation and raise prices, or they fail to prevent competition from quickly bringing to market a competing product. In the latter case, by your theory all innovation instantly screeches to a halt (if that theory is wrong, or you retract it, we can safely abolish patents) and in the former case the harms you are trying to claim here don't happen *do* happen.

Either way, you're toast, Lonnie.

"My claims are only erroneous when you back up your comments with facts."

Which I have done, and will continue to do, as long as you continue to flood this website with enormous volumes of bullshit every freaking week.

"The value of any invention to society is when it is revealed"

No, the value of any invention to society is when it actually becomes generally available as a labor-saving device or method, a cure for something, or some otherwise-desirable product or service that real people can actually afford.

"because revealing the invention permits other inventions (and innovation) to build on that invention."

Patents hold that back, since you have to wait until the patent expires, pay through the nose for a "license" (if one is even for sale to you), or infringe.

"Patents provide an incentive to reveal, regardless of whether the product ever makes it into production."

Bollocks. Have you seen the quality of patent applications these days? When they aren't vague and nonspecific enough as to be unusable for someone "skilled in the art" to reproduce the invention, they are instead "inventions" that are obvious incremental developments or combinations of ideas to someone "skilled in the art". Neither sort of patent is supposed to be granted, of course, but that's the reality of the situation, Lonnie. The patent system is a patent failure (pun intended) at "revealing", too.

"Perhaps 80% to 90% of all inventions never make it into production. Without patents, many of those inventions, and perhaps most, which are currently revealed by way of a patent, would not be revealed to the world."

If they never make it into production, then by definition their absence would make no practical difference to society. The patent office has file drawers full of reinventions of the square wheel that nobody has a use for.

""The burden of proof is always on pro-IP camp, simply because special protectionist laws are in force _already_ that are supposedly required."

I think you have that a little backward."

No, he does not.

"The burden of proof is on the anti-IP camp"

No, it is not. The burden of proof always rests on those who seek to legislate a restriction on the freedoms of others or an intervention in the free market. Copyrights and patents are both -- they restrain free transaction among consenting parties (for example, "I'll make you a copy of the latest Alanis Morrissette CD for a buck") and they restrain the invisible hand (that CD is being sold in stores at thousands of times its marginal cost of reproduction of a penny or so, and that retail price remains stable for quite a while; ergo the market is being held back from becoming efficient and competitive in some way).

"invention and innovation has accelerated exponentially."

Despite, rather than due to, patents.

"Why does 90% of the population have to prove anything to 10% of the population?"

Because they could be wrong, and they want to restrict freedoms.

"Seems to me that the numerous studies that show the benefit of patents to the establishment of new industries and for capital and research intensive industries are the case. Have you been paying attention?"

Show us the studies that PROVE, beyond a reasonable doubt, that there IS NO BETTER WAY, no way that doesn't involve abrogating freedom of transaction and cuffing the invisible hand.

"Oh, I see. So new inventions have no value, but making existing goods better and cheaper has value."

He didn't say that. New inventions have value, IF they are available to the general public or to those that need them. They have more value, the more available they are.

"I would rather have affordable, fast transportion than a highly refined horse and buggy."

Your precious patent system is what results in the latter: someone invents the car, he patents it, and you end up with one company selling Model Ts at Rolls-Royce prices and everyone else selling highly refined horses and buggies.

"It took tens of thousands of inventions, many of which never went into production while their patents were in force, but which formed the basis of other inventions, to get us to where we are today."

And how much sooner could they have formed that basis without the patent forcing everyone to wait for its expiry?

Oh, but you claim the invention would never have been revealed without the patent? Why? There are academic journals. Also, without the patent, the inventor can't make money off the invention by patenting it and then either licensing the patent or launching lawsuits; he'd have to actually get off his duff and make and sell a product of some sort, so there'd have been a product that much sooner. If it flopped, it would still be the basis for reverse engineering and improvement by competitors almost immediately.

Even if it somehow could never have gotten published except as part of a patent, why not get rid of the monopoly and keep the rest? Oh, because you claim the patent wouldn't be filed without the expectation of a financial return, which comes from the monopoly.

In that case, explain why so many patents do get filed that never make the filer a dime before the patent expires, then?

You're wrong, Lonnie. And it's easy to see with just a bit of simple logic.

"Okay, then let us never reveal any invention to the world, and we can all go back to scrabbling in the soil and killing each other with sticks and stones to survive."

A ridiculous slippery-slope argument from Lonnie. We went far beyond "sticks and stones" before the patent system was employed.

"How can "a few in the position of power" (whatever that means) jack up prices when the prices never existed prior to the invention? That makes zero sense."

Assumes an unproven claim (that the products would never have existed without patents).

""But people are not stupid, they can work things out once they see them. And so they would the innovations."

Farfle, farfle pippick? Sorry, I have no idea what language this is, but it is unintelligible."

It's apparently one you just made up on the spot, Lonnie. The phrase "But people are not stupid, they can work things out once they see them. And so they would the innovations." is perfectly valid English.

""Yeah, that's why open source folks are not legally allowed to ship perfectly good MP3 implementations, they wrote themselves. And that's why Theora/Ogg had to be invented to _avoid_ the supposedly usable invention. Please, spare us the nonsense about exponential innovation."

Excuse me? Exponential innovation is nonsense?"

No, the notion that it wouldn't have come about without patents is nonsense.

Please at least try to improve your skills in the areas of reading comprehension, following instructions, keeping promises, and getting along with others, Lonnie. Or you'll get no little happy-face stickers on your December report card.

"I have no idea why the patent system is an oligarchy. Anyone with a novel invention can get a patent, even you..."

Right. It takes gobs of money to get one, and ludicrous amounts to fight a patent lawsuit; without the latter capability, your patent is a paper tiger.

Patents are just one more thing that tilts the playing field in favor of big incumbents that have deep pockets (and existing patents to leverage, e.g. by blackmailing a startup with credible threats of lawsuits, or just keeping new companies from entering a market by refusing to license key patents).

"About 1/3 of all patents are issued to individual inventors (which would be somewhere around 2 million patents or so). A goodly chunk of the remaining 2/3's are issued to small and medium sized businesses. Though I do not have facts, I would guess that about 4 or 5 million of the 7.4 million patents issued in this country went to individual inventors, small and medium businesses. That just does not seem like an oligarchy to me."

But what do those patents avail them when they go up against a Goliath like Microsoft with several thousand patents and an army of expensive lawyers to wield them?

"You mean when the rate of invention and innovation was orders of magnitude slower than they are now?"

The reasons for the speedup have nothing to do with patents. Read Ray Kurzweil.

"Seems to me that the numerous studies that show the benefit of patents to the establishment of new industries and for capital and research intensive industries are the case. Have you been paying attention?"

These prove that companies can leverage patents to make more money. We knew that. They don't prove that patents are good social policy, and they don't prove that industries couldn't benefit more (and more fairly) under some other scheme, one that does not create monopolies or inhibit others' freedom of transaction.

"Interesting organization with an interesting business plan. I also notice that Red Hat has about 100 patents and applications."

That'd be their deterrence arsenal, to keep Microsoft from suing them. Also, by patenting something they prevent anyone else from patenting it and then using that patent against them. You didn't hear of them suing Oracle when Oracle was selling cheap copies of Red Hat software, though, did you? I know I didn't.

"I consider MP3 niche because while it may be "literally everywhere," it is only used on certain types of devices. I have an MP3 player, but rarely use it because the dynamic response of MP3 and the quality of the sound is greatly diminished."

Nonsense.

"I prefer CD's, and, even more, vinyl albums."

Luddite. No wonder you favor the patent system.

"You are getting into a realm about which I know little, that being copyright and formats. However, one of the purposes of patents was to promote innovation, and if Ogg was invented to avoid MP3 patents, it appeared to have worked."

Superior compression would have been worth researching and developing anyway, of course.

"As for copyrights, I personally think they last too long."

Yeah, by about "the author's life plus seventy years". Shorten them by that much and then you've about got it right.

"When it costs 10 million to 50 million to develop a new engine or transmission, and payback is 3 to 10 years, I can see the value in the life of patents."

Why not make it a longer-term investment, instead of insisting on payback in only three years? Or, pool R&D resources with your competitors. A rising tide floats all boats. Also, anyone that doesn't join the pool risks being left behind, losing the early-bird advantage.

"A song costs maybe $10,000 to $100,000 dollars to record."

If you do it in a woefully inefficient manner. With modern techniques and technology, it can be done for as little as 1/1000 of that.

"Even if marketing costs $500,000 (which seems a bit distorted)"

Done right, marketing costs $0, of course. (Record. Upload to torrent site. Update MySpace page of band. Wait. Then sell concert tickets.)

"The cost of music should be whatever the market will bear, while a reasonable length copyright is in effect."

The cost of anything should be its marginal cost of production, starting very soon after it exists at all.

"Reverse engineering is not possible for everything. We call those features that cannot be discerned by examining a product "trade secrets.""

And we have them anyway, even in the presence of the patent system. So much for your claim that patents are the alternative to trade secrets; the two clearly coexist quite happily.

""OK, here is an exercise for you. Try designing a new processor. See how far you get without cross-licensing with IBM, Intel and the other oligarchs."

Try designing a new transmission. If it is really new, you will be violating no one's patents."

There's only so many ways to skin a cat, to mangle a common idiom.

""All we got from this system is more patents"

Abundant studies show that is not true."

Are you calling Jimbo a liar? In public, and to his face? Shame on you!

As near as I can tell, Jimbo is telling the God's-honest truth.

"I have cited several on this site, would you like more? I am aware of a couple of dozen separate studies that show that patents have benefited the establishment of new industries and businesses. How many would you like?"

I've already dealt with that nonsense elsewhere and previously. Patents have not been proven to be the only way to do so, nor has the cost to society been shown to be less than the benefit. Indeed, the evidence clearly indicates the opposite.

"Innovation is relatively unimportant to me because I read innovation as "I made your product slightly better so I should be entitled to profit from it." Yeah. You could not create, so you act as a parasite."

This attitude is soooo wrong, and the cause of soooo much trouble...

""People innovate because they want to - whether they have monopolies on this or not. And they always find ways of making money on it. The rest is just greed."

Actually, I agree with you on this."

Well, there you go then.

Lonnie sees the light at last!

Will you post a scathing condemnation of the patent system now, and then maybe go away? :)

"However, there are many activities for which innovation will never occur without patents"

BULLSHIT!

"payback would never occur without patents"

POPPYCOCK!

"Again, there are dozens of studies that clearly show this is the case - which includes at least a half dozen studies by anti-IP researchers."

BALDERDASH! Those studies may indicate that *some* intervention may be needed *in a couple of particular industries*, but they by no means prove that it must necessarily take the form of granting monopolies and interfering with others' freedom of transaction and property rights!

"As for making money, an imitator will always find it easier to make money than the inventor"

BOLLOCKS! Read up on the first-mover advantage, again.

"the inventor will realize invention is a losing proposition and stop inventing."

I don't know of any creative type of person that doesn't create stuff for its own sake, without requiring advance proof of financial reward.

"Lack of patents has a chilling effect on inventing for certain industries."

Unproven. Even if an intervention of some sort is needed "for certain industries", you have not proven that it must take the form of patents.

"If you develop your own software, the per player license is 75 cents."

Which is 75 cents more than it should be.

"It is difficult for me to get alarmed over 75 cents."

It is an affront to free enterprise, freedom of transaction/contract, and freedom in general. It is an affront to capitalism. Indeed, it is positively un-American. A private party granted the effective power to levy an "mp3 player sales tax"? I'm not sure whether that's communism or fascism, but neither is attractive, so I don't suppose it really matters.

Furthermore, the jump from zero cents to one cent is enormous. Suddenly, you can't act in the marketplace in certain ways without extra transaction costs and overhead, without involving yourself with a particular third party that you ought to have the choice to avoid (seeing as they're not the government in any country where you're doing business), and so forth. That can be incredibly constraining. For example, you can't just build one in your garage and then give it to someone; now you have to incorporate as some sort of business, hire a lawyer, negotiate this, do that, fiddle with these, and pay the piper first.

What a ludicrous boondoggle!

"Furthermore, the average American wastes several times that amount per day in food and energy that could go to help dying Africans (right Cheesewax?)."

That is their choice. Freedom is paramount, and you advocate reductions in freedom. Here you seem to be advocating outright communism. I guess all your cards are on the table at last, eh, Lonnie?

Oh, and it's "Jimbo", not "Cheesewax". You're being very rude to Jimbo, and without any apparent provocation. In fact the only person provoking people around here is you, with half-truths, personal attacks, and sheer posting-volume (which has, in recent weeks, attained levels that I believe make you officially qualify as a spammer).

"The only difference here is that you object to the royalty, but you do not object to the much easier to control waste."

He, and I, object to the abrogation of basic freedoms. That other waste could not be controlled without government-imposed restrictions that would be even worse than the continuation of "IP".

"I think this is amazing. Let me get this clear. A patent existed on a technology. In order to avoid the patent, a competitor developed new competitive technology? So, the existence of a patent caused progress in the arts. Seems like the MP3 patents did exactly what they were supposed to do."

You assume all of these questionable things:

* That the same result could not have been accomplished in a non-freedom-destroying way.

* That it needed government intervention at all; that ogg vorbis, or something like it, wouldn't have been developed anyway. If it is superior in engineering, odds are it would have, for engineering reasons.

"First, about half the MP3 patents are held by smaller companies"

This does not make them less evil.

"and the licensing royalties are set, published and clear."

Neither does this.

"So, "in favour of big players" seems a critical distortion."

Even smaller companies are bigger than startups, and those are bigger than individuals.

"Second, how is having MP3 patents a "critical distortion of the system"? MP3 was developed from nothing. It was revealed to the world in patents and developed into encoders and players."

Without patents, it would still have been disclosed. Indeed, any decoder software could be decompiled and bam, it's disclosed!

"I fail to see where anyone strong-armed anyone else to purchase MP3 technology."

It became a defacto standard, and I believe you mentioned a royalty rate that was set, and an army of lawyers?

Nobody should have had to purchase anything; they should have been able to use it freely.

"people are exaggerating the effect of patents on a luxury item."

It's a single example. Perhaps you're right, in which case it's a poorly chosen example. It's still a valid example that demonstrates many points that apply to more pernicious patents that affect more vital goods and services, though.

"Your fundamental argument, as I have seen many times, is that MP3 would have been invented even if the people that developed MP3 would not have."

Eh? You're not making sense, Lonnie. (As usual.)

"I also saw someone make the outlandish claim that all inventions are invented simultaneously (meaning more than one person in separate locations invents the same thing at the same time).

Simple response: facts not in evidence.

Would MP3 have been invented, eventually? I have no doubt."

Well, there you go then. And if not MP3, then some similar audio compression system, and probably around the same time. Indeed, the only audio format inventions we'd miss without "IP" would be the various innovations in evil DRM that have been made to try to "protect" evil copyrights! Big loss there.

"patents set a goal line in a race that people may or may not think they are running, but they know there may be a pay off if they can cross that line."

That goal line can, of course, be set in other ways. Indeed, the release of a new "killer app" product is generally going to have that effect, patents or no patents.

"Are some things invented at the same time in separate locations? Yes. Are there a lot of things invented at the same time in separate locations? Probably not. Why do I make this statement? Let us examine USPTO statistics for interferences, which are declared when two entities claimed to have invented the same mechanism at the same time."

Objection: biased sample. Only cases where competing claims got filed will come to light. Cases where someone invented something, discovered a pre-existing patent filed yesterday by a rival he didn't know he had, and said "fuck it" are not going to be represented. So the rate could be higher, much higher, than you calculate.

"In FY208, 66 interferences were declared, out of roughly 300,000 patent applications. Hardly seems like many people are simultaneously inventing."

See above.

Also, how many of those patents represent real "inventions" and not obvious things, things with prior art, vague claims that something is feasible without detailed blueprints, and so forth? Remember, patent quality is abysmal these days.

""End result: you pay more for Red Hat to deliver service to you."

Obviously, the amount must be less than 75 cents per player, or they would have licensed MP3."

Irrelevant; the Red Hat stuff has nothing to do with MP3 patents.

"The problem is time and money. When a manufacturer pays for an assembly line and tooling, the investment can easily be in the $10 million or $20 million dollar range. So, the inventive company invents a new product, invests $20 million in development, $20 million in more in tooling. Without patents, a competitor examines what the inventive company did, figures out how to avoid their mistakes and spends half as much to bring the product to market."

$20 million in development may be a sign of woeful inefficiency somewhere. Or they could pool talent, as described above. Or they could keep ahead of the competition with improvements and the use of their greater in-house expertise, thus holding on to a lion's share of the market.

There are ways to do it right, without patents. They involve work, including keeping your product up to date and keeping ahead of the imitators. But it's hardly a defense of patents that they enable a company to just sit on its laurels and rake in the cash without continuing to work hard for it. If they just sit there manufacturing the same stale old model year after year, they shouldn't expect to be able to make much profit! And in a true free market, they would not.

"Regardless of the choice they make, lack of patents penalizes the inventive company and rewards the imitator."

In other words, creates a level playing field from the present, tilted one. Oh, how horrible.

"So, you DO understand my point. Yes, Coca-Cola has a trade secret, but that trade secret did NOT stop anyone from developing a different, competing product."

Well, there you go then. Trade secrets aren't the awful bugbear you make them out to be. And so one of your "points" in favor of patents is doubly-disproven: a) patents don't actually prevent trade secrecy being used, and b) trade secrecy isn't all that terrible anyway.

"Similarly, MP3 does not prevent someone from developing a different competing product. In fact, that was one intent of intellectual property: Reveal invention A and provide a limited right to restrict make, use or sales of that invention in the hope that the example of invention A would spur invention B, expanding choice and knowledge, and generating competition."

But it doesn't tend to work that way very often in practise. Or we wouldn't have so many arguments about drug affordability for needy people, now, would we?