Sunday, June 10, 2007

Patenting Some Obvious Thing will Raise Inequity in the World

Bill Gates at Harvard on June 7 2007 told graduating students:
”……I left Harvard with no real awareness of the awful inequities in the world—the appalling disparities of health, and wealth, and opportunity that condemn millions of people to lives of despair.
I learned a lot here at Harvard about new ideas in economics and politics. I got great exposure to the advances being made in the sciences.
But humanity’s greatest advances are not in its discoveries—but in how those discoveries are applied to reduce inequity. Whether through democracy, strong public education, quality health care, or broad economic opportunity—reducing inequity is the highest human achievement....
I hope you will judge yourselves not on your professional accomplishments alone, but also on how well you have addressed the world’s deepest inequities… on how well you treated people a world away who have nothing in common with you but their humanity. “

Very moving words, reminiscent of Mahatma Gandhi.

TIMOTHY B. LEE in his column “A Patent Lie” in NYT on June 7, 2007 says:
” WHAT a difference 16 years makes. Last month, the technology world was abuzz over an interview in Fortune magazine in which Bradford Smith, Microsoft’s general counsel, accused users and developers of various free software products of patent infringement and demanded royalties. Indeed, in recent years, Mr. Smith has argued that patents are essential to technological breakthroughs in software.

Microsoft sang a very different tune in 1991. In a memo to his senior executives, Bill Gates wrote, “If people had understood how patents would be granted when most of today’s ideas were invented, and had taken out patents, the industry would be at a complete standstill today.” Mr. Gates worried that “some large company will patent some obvious thing” and use the patent to “take as much of our profits as they want.”
Mr. Gates wrote his 1991 memo shortly after the courts began allowing patents on software in the 1980s. At the time Microsoft was a growing company challenging entrenched incumbents like I.B.M. and Novell. It had only eight patents to its name. Recognizing the threat to his company, Mr. Gates initiated an aggressive patenting program. Today Microsoft holds more than 6,000 patents.

It’s not surprising that Microsoft — now an entrenched incumbent — has had a change of heart. But Mr. Gates was right in 1991: patents are bad for the software industry…..

The Gates memo predicted that a large company would “patent some obvious thing,” and that’s exactly what Verizon has done. Two of its patents cover the concept of translating phone numbers into Internet addresses. It is virtually impossible to create a consumer-friendly Internet telephone product without doing that. So if Verizon prevails on appeal, it will probably be able to drive Vonage out of business. Consumers will suffer from fewer choices and higher prices, and future competitors will be reluctant to enter markets dominated by patents.

But don’t software companies need patent protection? In fact, companies, especially those that are focused on innovation, don’t: software is already protected by copyright law, and there’s no reason any industry needs both types of protection. The rules of copyright are simpler and protection is available to everyone at very low cost. In contrast, the patent system is cumbersome and expensive. Applying for patents and conducting patent searches can cost tens of thousands of dollars. That is not a huge burden for large companies like Microsoft, but it can be a serious burden for the small start-up firms that produce some of the most important software innovations.

Independent invention is not a defense to patent infringement, and large software companies now hold so many patents that it is almost impossible to create useful software without infringing some of them……

Only patent lawyers benefit from this kind of arms race. And Microsoft’s own history contradicts Mr. Smith’s claim that patents are essential for technological breakthroughs: Microsoft produced lots of innovative software before it received its first software patent in 1988. As more and more lawsuits rock the industry, we should ask if software patents are stifling innovation. Bill Gates certainly thought so in 1991, even if he won’t admit it today.

Therefore, as we remain grateful to Mr. Gates for philanthropy, world would be more equitable place if he became equally generous towards small start-up firms.

Imagine Wright Brothers could not invent the Aerial Age because of a patent……….


Artist: Chon Day The New Yorker 28 Sept 1940