Subject: RE: GIF/LZW patent
From: "Lawrence Rosen" <lrosen@rosenlaw.com>
Date: Wed, 27 Sep 2006 09:03:29 -0700

Chris,

Your email is misleading and inaccurate. 

First, I was postulating a hypothetical legal scenario. Of course the world
would be a worse place if the number of low-quality and improvidently-issued
patents increased. That is why all the major software companies (and our
little International Characters venture) are joining in Community Patent
Review. We want only our valid patent claims to issue; we're not just
interested in having patent plaques to post on our walls. Please give this
process--and other attempts to fix the system by OSDL, OIN, the PTO itself,
and many others--a chance to work.

My topic is software patents so references to situations in pharma and the
auto industry are only mildly relevant. But I guess I brought it up by
saying that the copyright regime confuses computer software intellectual
property in ways that no other technology has to bear. So let me correct
you: 

(1) Pharma patents have their own problems. One of the reasons that the
software patent mess isn't being addressed is because politically it is
being conflated with pharma patents. A unified position on software patents
by the software industry, including open source leadership, rather than a
reflexive "I don't like 'em" reaction, would help enormously to focus
political attention on the need to reform *our* area of technology
independent of pharma's special needs. From my perspective, the problem in
pharma isn't too many patents, or low quality ones, but the term of the
patents and the difficulties that poor people have to get essential
pharmaceuticals. Perhaps compulsory licensing at reasonable rates, or
perhaps shorter terms, or perhaps different ways of funding expensive and
time-consuming drug testing????

(2) Cross-licensing in the auto industry (or perhaps, as you describe it
instead, an informal agreement not to assert their patents against each
other) is a good thing, not a bad thing. Particularly in industries where
there is a large cost barrier to entry and enormous manufacturing expenses
(unlike software!), an agreement not to impose large patent costs against
each other is an effective business strategy. As long as such informal or
formal arrangements don't adversely affect innovation and competition in
automobiles, I'm all for them.

(3) I don't understand much about the chemical industry, but it seems to me
that it is not burdened by the enormous creativity spurt that characterizes
the software industry today. Perhaps when invention in software stabilizes
after a time (hah!) we'll reach a steady-state patent market similar to the
one you describe for chemistry.

Finally, you describe these problems generally as making it "very difficult"
for small companies to become peers in the market. According to the PTO, the
independent inventor share of all patents issued to U.S.-resident inventors
was 15.5 percent in 2005 and 16.1 percent in 2004. That's a significant
percentage that belies your suggestion that small guys can't play in the
patent game. The cost to play effectively with patents is much lower than
the cost of setting up huge companies to dominate the software industry. If
anything, that's why the big companies have joined the push for software
patent reform: They're more scared of the little guys than the little guys
are scared of them.

/Larry

> -----Original Message-----
> From: Chris DiBona [mailto:cdibona@gmail.com]
> Sent: Tuesday, September 26, 2006 10:45 PM
> To: lrosen@rosenlaw.com
> Cc: Free Software for Business; Rob Cameron; mbeinschlag@rosenlaw.com
> Subject: Re: GIF/LZW patent
> 
> > I'll be blunt about it: If we didn't have copyright on software and only
> had
> > patents, we'd be much better off. At least then monopolies would be
> based
> > upon innovation instead of mere writings by armies of programmers of
> mostly
> > me-too code. Programmers would be rewarded for being innovative, and the
> > rest of us could otherwise copy and reuse any non-patented or off-
> patented
> > software we wanted, regardless of who wrote it. That's how intellectual
> > property works in every other area of technology! Wouldn't that be a
> better
> > world?
> 
> Yes, but the  'world' does not grant patents to only the truly,
> uniquely, innovative. They grant and allow the litigation of
> submarined, obvious, broad patents that certainly stifles ordinary
> innovation instead of rewarding the extraordinary.
> 
> I was also on the team for one of these kinds of suits, PMMC v.
> Viacom, in the mid-90s. It is why I bacame the open source person I am
> now. I found the award of 130m+ to PMMC for the exceptionally simple
> technology they were litigating about to be a pretty oversized,
> outrageous result.
> 
> It is worth pointing out that this statement:
> 
> That's how intellectual property works in every other area of technology!
> 
> Is also incorrect. In pharma, patents have been so overused (along
> with vast regularoty compliance cost) to stifle the industry into a
> patronage/research lab structure. In autos: Vast number of patents are
> filed and left unlitigated while the competition blindy 'steals' the
> ideas/inventions that were patented by one of the other dominant
> players. In chemisty, patents have some weight, but the overall burden
> of patent litigation cause companies to broadly cross license with
> each other rather than litigate.
> 
> What do all these have in common? They all make it very difficult for
> small companies to become peers in the market due to the lack of
> patent/trademark/channel 'armor' that is in place around the dominant
> players.
> 
> I'm not promoting a fix or a solution, I'm not sure that I have one or
> that I agree with the destruction of all patents or some subset
> therein. But suggesting that replacing one regieme with the one that
> serves large players overwhelmingly over the small would be unwise.
> 
> Chris
> 
> Chirs
> 
> --
> Open Source Programs Manager, Google Inc.
> Google's Open Source program can be found at http://code.google.com
> Personal Weblog: http://dibona.com