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back to article Are we in the middle of a PATENT BUBBLE?

For some time, the only reason the word 'patent' meant anything to the average Joe was if they happened to know that Albert Einstein was a patent clerk before he became a rock star physicist. Nowadays, everyone is well up on the Great Patent Wars of technology firms, in particular the face-off between Apple and Android OS …

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Facepalm

Edison

"For some time, the only reason the word 'patent' meant anything to the average Joe was if they happened to know that Albert Einstein was a patent clerk before he became a rock star physicist."

Or if they'd ever heard of Thomas Edison.

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Paris Hilton

Thomas who?

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Ru
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Trollface

Thomas who?

You know, the guy who stole all of Tesla's ideas and patented them?

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Trollface

Or they used to watch Wacky Races with Professor Pat Pending!

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not all

only the ones ha was capable of understanding

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Well, Edison had a team of people working for him to patent the stuff he couldn't understand.

In many ways Edison created the mess we're in today, and wasn't above having people killed if they didn't like his approach.

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Gold badge

That "man cannon" ...

How do you persuade the enemy troops to get into it?

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Happy

Don't point your man cannon at me-

I surrender!

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Joke

@"How do you persuade the enemy troops to get into it"

You label part 69 a Parachute. ;) ... (Without explaining that it most likely won't work that near the ground!).

In which case, I'm assuming part 68 is extra absorbent Diapers ;)

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Wouldn't it be simpler if patents were non-transferable?

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Anonymous Coward

"Wouldn't it be simpler if patents were non-transferable?"

On the planet that brought us Enron and Intellectual Vultures, how would you police this?

In fact, it would be simpler if large swathes of territory were unavailable to the granting of patent monopolies. Thought of a nice technique? Get using it, because someone else has probably already thought of it. Think your rounded corners are "novel"? Get over it, because the same instincts that led you to that realisation are shared by most other human beings. These corporations should get on with competing with their considerable resources in the luxurious circumstances they inhabit, instead of trying to exclude each other (or newcomers) from the marketplace.

And I now leave you with the joke of the article:

"When we think about strategy, these deals are all about positioning in the marketplace for phones and tablets and about market share, they're not really about exclusion."

Patents are monopolies and are thus all about exclusion. Sheesh!

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FAIL

Sigh

"Think your rounded corners are 'novel'?"

Good grief, I'm as anti patent trolling as anyone here but I try to maintain at least a basic comprehension of the current landscape.

"Design patent" != "tech patent"

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Re: Wouldn't it be simpler if patents were non-transferable?

This could actually harm inventors. If I invent something, I might be better off selling my patent to a company capable of producing and marketing it and policing for infringement of the patent, rather than doing all that myself. After all, many inventors do not have the capital and resources to police a patent properly, and fight legal battles against potentially very wealthy players. I could of course sell a unique, non-transferable license for production or marketing, but what of the policing bit, would the license holder do that?

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Boffin

It's really very simple.

If the problem is of quality, and the cost of manpower to perform proper reviews, then the cost of a patent should go up till the budget balances.

This will mean that fewer patents will get submitted, and the patents that are submitted will get reviewed thoroughly.

Simples.

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Correct

The patent system does not scale. Every patent needs to be examined by a person. Double the number of patent applications and you need to either double the number of examiners, or halve the time spent on them.

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except that ...

... only the huge corporations will be able to afford the patent fees so the, perhaps somewhat neglected, purpose of allowing the "lone inventor" to protect their efforts for an affordable fee gets lost.

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Or maybe...

Impose severe fines for willfully omitting prior art. I'm amazed at the number of times a patent article comes up and people in a matter of google minutes are able to find prior art that completely implements (and therefore invalidates as non-original) the patent

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too simplistic

Increasing the fees does not mean that the quality will increase. There is no incentive at all for the patent office to perform _any_ review at all. There is no downside to simply granting every application and collecting the fees. The challenge to the patent is done through the courts and any review requires that further fees be paid to the patent office.

What is required is to make the patent office responsible for the effects of granting the patent. If, for example, prior art can be shown then the patent office should be liable to pay the costs of defending against the patent in court, or at least partly responsible along with the holder.

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FAIL

Prior art doesn't work

Enough cases have been reported in the pages of this august journal and elsewhere of patents being upheld, even if they are clearly invalidated by prior art, or are trivially derived from it.

Patent lawyers have a nasty trick, where the scope of the patent is argued narrowly when considering prior art, but is then argued ludicrously broadly when considering infringement. They are allowed to get away with this, so the practical result is that any attempt to strike down a patent claim for being bleedin' obvious is so expensive that it's cheaper to settle.

Since all the money to be made is made in this way, don't expect any change.

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Thumb Down

The patent system is an unmitigated disaster

I thought this report would be about the costs of the patent system itself, rather than the cost of patents. It is currently just a mechanism by which tech companies can whack each other on the head, and 'non-practising entities' can whack all tech companies on the head.

It would be better if the patent system was destroyed, root and branch, than if it continued in it's present form.

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If we are in a patent bubble

Please form an orderly queue behind the needle.

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Flame

Well Said

And if the current "financial elite" sees patents as a business model they will surely sue the whole technology industry into an innovation-standstill. Trivial patents will cost at least 500 million dollars, because these people are only driven by extreme greed and nothing else.

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Facepalm

An "unmitigated disaster", you’re too kind sir or madam, describing the patent system is an unmitigated disaster is a bit describing the sinking of the Titanic as minor boating incident, any system that allows the following 'patents' is more than broken, I honestly believe that the people working^H^H^H^H^H^Hemployed in the 'merkin patent office are either 1) having a laugh accepting patents for the most ridiculous shit, 2) just rubber stamping everything or 3) using too much whacky-baccy (see 1)!

As proof I offer these patents:-

No. 4022227 - Method of Concealing Partial Baldness (the comb-over).

No. 5443036 - Method of exercising a cat (using a laser pointer).

No. 4170357 - 12-gauge golf club (do you need a gun licence?)

No. 4320756 - The toilet snorkel (what a way to spend the last moments of your life!!!!!)

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Anonymous Coward

"Wouldn't it be simpler if patents were non-transferable?"

How would you define non-transferable? Couldn't be bought if you buy the company? This would devalue all stock for tech companies. If you allow patents to be bought with a company, then people would just create shell companies to hold patents and then sell these instead.

"the cost of a patent should go up"

So you'd price small companies out of the process? Even better for large companies wanting to create monopolies by enforcement of patents.

Sorry I can't offer a better idea though; in the words of Deep Thought "I'll have to think about it".

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okay?

"How would you define non-transferable? Couldn't be bought if you buy the company? This would devalue all stock for tech companies."

Okay? So why is that a reason not to do it, then? Last I checked, the job of the law was not to uphold the share value of tech companies. (Of course, the notion that it *is* the law's job to uphold share values might be the reason for a lot of the messes the law is in...)

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Anonymous Coward

simple solution, make all patents frand. Fair enough, you have the patent so you should (maybe) get a fair and reasonable sum for it but you shouldn't use it to control a market.

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Nice idea, but whose definition of "fair and reasonable" are you going to use?

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Megaphone

Missing the point

The idea of patents is to grant a *temporary monopoly* to the inventor, allowing them to charge monopoly prices for some period of time in exchange for disclosing the details of their invention, or at their option, to grant licenses as they see fit. But the exclusivity and threat of enforcement remains the primary attraction for IP creators.

Given the choice between a licensing revenue stream and having a trade secret that lets you do something no one else can, guess which one most companies would pick? The whole idea of patents and exclusivity is ultimately screwed in our modern age-- if all the big players enforced their little monopolies, it's unlikely anything could be produced. Patent reform? You're having a laugh-- it's time to put the entire system out of its misery.

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If all patents were FRAND

Why would I spend eleventy billion dollars working out how to do cold fusion, if I am then forced to license it to EDF for peanuts?

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because

Because cold fusion is an awesome thing and being one of the thousands of people who contributed to its achievement would be a neat thing. Isn't that a good enough reason?

(Or, what, do you somehow assume you could achieve cold fusion without building on the intellectual achievements of countless thousands of people throughout history, very few of whom would have considered the idea of 'patenting their ideas' to be a sensible one?)

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Well then, Tom 38,

don't. Take your eleventy billion dollars and invest it on the stock exchange. Meanwhile, somebody else with money and a bit more vision beyond the ability to see only as far as his own hip pocket will invest in inventing cold fusion instead.

And in a century's time, whose name will be getting taught to kids in history class as the man who freed civilisation from the shackles of the fossil fuel industry? As opposed to Tom 38 who would have merely replaced one hydraulic despotism with another?

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Naïve and clueless

Why don't you get back to protesting that 'Capitalism is Crisis', without ever explaining how we go from here to your utopia. Without patents, we wouldn't even be having this discussion, as computers probably wouldn't exist (not in this form).

Face it, human technological evolution relies on one of two things:

1) The desire to kill other people

2) The desire to profit from other people

von Neumann was thinking of both when he patented how to make a nuclear bomb.

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Anonymous Coward

"It would be better if the patent system was destroyed, root and branch, than if it continued in it's present form."

I hope none of your pension fund is invested in technology companies!

Seriously; this would destroy the value of many American and European companies, leaving those who manufacture products, rather than those who design and invent them, with all the profit.

For example; Apple develops the iGadget and sends the designs to XYZ Manufacturing in the far east; XYZ Manufacturing says "fuck you very much" and just sells iGadget clones to anyone who will buy. Apple doesn't like that, so for iGadget 2 they make it themselves, in the USA, for $500 each. XYZ Manufacturing buys one (or finds a prototype in a California bar) and then goes on to make its own iGadget 2 clone for $200. Apple goes out of business, because who will lend them money to develop iGadget 3 if there's nothing to protect the investment?

Patents are a good thing! But the way they are being evaluated is at fault; we're letting too many obvious ideas get patented which devalues real research and development. Maybe the best solution is to fix the cost of licensing a patent at the time the patent is given, perhaps based on how difficult/costly the design process was; this could be subject to legal appeals by either side if .

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and...

that's a bad thing because????

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There are these things called contracts, perhaps you've heard of them? Apple and XYZ manufacturing develop a contract for the production of iGadgets, with punitive measures if either party breaks the contract. Manufacturing clones and selling them to all and sundry would break the contract so hard it makes an audible snapping noise and XYZ would face all sorts of legal wrangles from Apple.

Patents aren't particularly relevant to the manufacture of goods in east asia by American companies as they're often manufacturing goods that aren't protected by the local patenting regime; the distribution of those goods is protected by contract. Where the issue rises up is when a company in, say, China begs, buys or borrows a patented widget from Widgets R Us and begins manufacturing their own without permission, in order to undercut the patent-protected market, either foreign or domestic.

All that said, I agree that patents, as they were originally conceived, are a good thing. They were designed to encourage the sharing of new ideas whilst still providing the originator with income. Now, they're used to kill off competition by application to such generic ideas as buttons, business methods and wiggling fingers against glass. The problem started the moment the patent office dropped the requirement for a working model.

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Stop

Nope

There is still copyright law to protect source and binary code, circuits, mechanical designs and so on. You do not need patents to protect companies from direct rip-offs.

Now try to near-copy Windows on your own and you will see that it costs a few billions to get something as complete and polished. Your arguments are basically invalid.

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@AC 14:48 , Quite right

"Seriously; this would destroy the value of many American and European companies, leaving those who manufacture products, rather than those who design and invent them, with all the profit."

Quite right. Without the financial incentive provided by patents, no one would bother to make anything new because there'd be no substantive reward. And then we'd end up in a society quite like that of the old Soviet Union. Dull, drab, and nothing getting better than it already is.

Private investment has driven the technology of the world for the past 200, 300 years. Take away the incentive, and you're then reliant on government to drive things forward. How likely is that to be a good thing?

Your point about the evaluation of patents being at fault hits the nail on the head.

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fch

Soviet union technology ...

... might not be sexy nor flashy and more often than not lacks the patent "protection" seen in "the west" if for no other reason than its age.

Yet, much of what got developed there has been developed with the intent to last - reliable, rock-solid, hard-wearing, widely applicable, ... - things that one would wish to be more prevalent in a forward-looking (sounds less cerealy-greenish than "sustainable") society.

There's a lot the Soviet Union(s) of this world are to answer for, and no I don't think it's a good idea (though probably patentable) to bring it back. But with respect to the soviet approach to technology (maybe crude to use, but well-working, possible to build from limited-availability resources, lasting for longer than a communist party chairman, produced-with-pride), I can't help but see some value in it.

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Happy

But, meanwhile, in Europe

We don't (yet) have software patents. You can still buy European software.

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Anonymous Coward

Not so much a bubble as a mine-field.

The problem with a lot of the patents is that they are not innovative and what they cover is obvious to experts in the domain of the patent. The people evaluating the initial validity of the patents are not experts in the domains of those patents

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"The problem with a lot of the patents is that they are not innovative and what they cover is obvious to experts in the domain of the patent. "

The best inventions seem completely obscure and when completed seem completely obvious. The toys you wonder how you never coped without.

After the invention has come to market and been played with it seems obvious.

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Mushroom

The idea versus the thing.

> The best inventions seem completely obscure and when completed seem completely obvious.

Patents protect implementations and not ideas.

If all it takes for something to be invented is a good description and the work of a college student, then it really doesn't deserve a patent. This was the case for my own "favorite" patents that Tivo was granted for the PVR.

You are advocating treating nukes like firecrackers for no other reason that you are really ignorant and you can't imagine anyone actually having a clue.

A 17 year exclusive innovation crushing monopoly is like any nasty thing you can name (nuke, toxic waste, biological weapon) and should be treated accordingly. Proliferation certainly shouldn't be casually encouraged.

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Anonymous Coward

That may be true, but most US patents aren't like that.

US Patent 6,016,038 Multicolored LED lighting method and apparatus - Filed 1997

That patent claims a data signal controlling LEDs dimmed by PWM.

That one is so obvious that I was doing it *at school* in the early 1990s.

There are many others of that nature.

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Unhappy

optional

The problem is also that the market for patents is being flooded with essentially worthless ones (swipe to unlock anyone) that nonetheless can cause a great deal of trouble. Quite a bit like all those CDOs, doncha think?

The only winners here are the lawyers. Again, a bit like the financial bubble too.

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Anonymous Coward

Patents last too long

Make them worth a year (or even less), and suddenly they make a lot more sense.

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I hate to support big pharma... it takes years to develop a new drug, then there is testing, licencing and release. This costs millions. The patent is granted to allow recovery of monies spent and make a profit.

A year wouldn't cut it...

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oh noes!!!!111!!11

you mean big pharma would become only the second or third most profitable sector!

whats happening in tech now has been happening with drugs for years.

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Or make patent duration variable?

In some sectors you can innovate quickly, and long duration patents can stifle innovation (potentially). In other sectors, innovation is slower, and patent duration might be longer.

Of course, you then end up with a question on how to judge the duration per domain, but it is worth a thought.

As others have said, the USPTO spends to little time evaluating patents. Things are a good deal better here in Europe, where investigation into prior art is generally quite thorough (as I noticed when I was (co-)inventor on a patent).

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Bring back Florian Mueller...

WTF?

"A lot of people have talked about it being bad for innovation but I think the ability to enforce patents is a core aspect of what drives people to invest the huge sums of money that they do in R&D," he says. "And ultimately that will be of benefit to the end user, even if in the short term there is an increase in prices as some of the litigation is settled in the form of higher licence payments by some of the makers."

Of course, it's all for my benefit. Thank you for explaining that, really, large convicted monopolists are abusing the patent system fot my benefit.

Reminiscent of "if you play the video backwards that, really, the LAPD are helping Rodney King get up"

(ascii art because m.elreg)

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Trollface

The worm is definetly in the fruit...

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