The conflicting views noted about the effect of standardization on innovation are related to a lack of understanding, more than a lack of data. When patents read on different concepts they have different economic effects. As example, drug companies find patents (which prevent other drug companies from making similar drugs) very important to their willingness to innovate. Conversely, many software companies find patents (which increase the cost of providing compatible interfaces) to be an impediment to innovation.
These examples describe the different effects of patents which control similarity (the result of repetitive processes and the basis of the industrial revolution) with the effects of patents which control compatibility (a relationship, often reached by agreement, between dissimilar processes, the basis of the information age). Until the patent system recognizes this distinction these conflicts will continue.
There are technical solutions which support compatibility, without reducing the incentive to innovate, as well as legal and economic approaches. See The Entrepreneur and Standards http://www.isology.com/pdf/IECChallenge2006.pdf for a more detailed view of the technical problem and solution.
Qualcomm would have done fine without patents if it continued to innovate. In fact when Qualcomm signed their first cellular network deal with PacTel Cellular in 1989 they didn't have a single patent covering CDMA in a cellular implementation. Qualcomm succeeded because they possesed many trade-secrets that were essential for a successful CDMA implementation. Qualcomm was also lucky in that the prior-art considered by the patent office was sufficiently different that their broad claims withstood reexamination. However it's now recognized by many that the first practical CDMA phone was invented in 1957 by the Russian engineer Leonid Kupriyanovich. Imagine if someone with an enforcable prior-art patent succesfully sued Qualcomm years after they become dominant in the industry and put them out of business. If the US patent courts weren't so biased in favor for large US companies this would happen much more often.
The fact is that a company that has the leading technology in a certain field and even a moderate amount of financial success if better off without patents. Take Microsoft and Apple who would have been been crushed by patent litigation if software patents where prevalent at that time. Patents only benefit patent attorneys and patent trolls. Both are a huge drag on innovation.
Yes, there is a potential market with trolls and front man for infringers, but I wouldn't call it "robust". Uninfringed patents are worse than worthless. Having infringed patents but unable to enforce puts the inventor in a bad bargaining position. Trolls are in the game for themselves to make a huge profit. It makes talking to Corleone a much more pleasant experience.
Rick: Try Irwin Jacobs. Without patent rights and a willingness to vigorously enforce it, there will be no Qualcomm. The best he can do would be to earn some consulting fee from "innovative" companies like Motorola.
It will be difficult to have a market for patents. Patent infringers have to prove in court that they do not infringe knowingly. If they try to buy that very patent, they must know the patent. So the standard approach is 1) to steal, 2) drive up litigation cost, 3) buy off university professors to spin (expertly) for the infringer, 4) buy off congressmen to junk the Constitution.
@Rick: Thanks for information. With invent of stong on-line community and things like bitcoin, is it possible for some organization take lead? They should not be concerend for political or legal system. One needs establist moemntum, one it is more prominent, government and other parties will join them.
It may look far fethched idea. But it is possible to associate new patents with stock exchange trading and they derive thier current value as per its applicability? As they become more relevant, other organization can trade them, quoting higher price.
Purpose of this is to filter out good patents and and not so good trolls.
Fortunately for the rest of us, the US constitution still holds, despite multiple assault from the "formerly poor". The US constitution is what made ours a country of financially motivated innovators. I sincerely hope that people, especially engineers, are smart enough to see through the effort of those "formerly poor" to legally rob people and debase the value of engineering. If they succeed, they will kill the incentive for innovation and turn USA into a Kenya without zebras.
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