"Meanwhile Samuel got no richer. He developed a very bad patent habit, a disease many men suffer from. He invented a part of a threshing machine, better, cheaper, and more efficient than any in existence. The patent attorney ate up his little profit for the year.Samuel sent his models to a manufacturer, who promptly rejected the plans and used the method. The next few years were kept lean by the suing, and the drain stopped only when he lost the suit. It was his first sharp experience with the rule that without money you cannot fight money. But he had caught the patent fever, and year after year......"
John Steinbeck, 1952
Mr. President, have you done anything for the Samuels of America? Do you think they have all disappeared, turned into a lesser copy of Mr. Suzuki, the company men? When IP rights cannot be enforced, how much of America will be left in 10, 20, 50 years?
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.
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.
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.
If Steinbeck is saying that patent trolling is a disease, I agree. If this inventor actually tried doing something productive like building the machine he invented either by himself or as an employee of another company everyone would be better off. But instead he decided to become a parasite and use the patent system to extort money from productive manufacturers. It's quite likely than many engineers independently developed similar ideas, they always do, fortunately not all of them become patent trolls. Everybody loses in these cases except for the patent lawyers.
Patents have been shown to be a huge drag on innovation. Time and time a again we see that whenever an industry wasn't protected by patents it flourished, and as soon as patents were introduce it withered. James Watt's patent of the steam engine quite possibly delayed the industrial revolution by 20 years, and he didn't make any money until after his patents expired. This is because after the patent expired there was an boom of steam engine manufacturing and everyone wanted Watt's expertise.
GreatCommunicator: your reading skill seems in need for improvement. Maybe for being a talking head for too long?
It looks like you have beef against the US Constitution. Anyway, in the unlikely case you come up with a new idea, you can give it to me and maybe I will give you a job. Well, maybe not, I need someone who can read.
Of course Steinbeck is railing against the rich lawyers and manufacturers that are taking advantage of poor inventors. And I sympathize, being a formerly poor inventor myself. However I took the path that Samuel should have, I developed my inventions into useful products and built businesses around those without seeking any government enforced monopoly.
I do have a problem with the constitution, on this I agree with America's first patent examiner, Thomas Jefferson. In a letter to Isaac McPherson in 1813 he said:
That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property. ... Accordingly, it is a fact, as far as I am informed, that England was, until we copied her, the only country on earth which ever, by a general law, gave a legal right to the exclusive use of an idea. In some other countries it is sometimes done, in a great case, and by a special and personal act, but, generally speaking, other nations have thought that these monopolies produce more embarrassment than advantage to society; and it may be observed that the nations which refuse monopolies of invention, are as fruitful as England in new and useful devices.
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.
The current patent debates are fascinating because they seem to evoke tremendous emotion - and yet there is so little agreement as to the right thing to do. Since current complex technologies like SmartPhone incorporate hundreds of "inventions", they are more susceptable to counterclaims and lawsuits than a "simple" device from the past. That said, I look back in history and see that the "hot" technologies of the time, like steam engines for which my great-grandfather invented an improvement in 1908, were a complex system of component inventions. While I don't believe his invention went to litigation, perhaps the patent battlegrounds just change through the years.
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.
@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.
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.