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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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Innovation, Consolidation, Then Litigation

Comments (6)

Philip Greenspun has an excellent essay up on the web titled Internet Software PatentsHe sets the tone by suggesting that "the natural progression of an industry is innovation, consolidation, then litigation."  Philip better be careful of he’s going to be spending a lot of time in East Marshall, Texas.

His decomposition of U.S. Patent 5367627 and analysis is straightforward and highlights the absurdity of this stuff.  Philip also asks "Are computer nerds smarter today than they were in the 1960′s" and provides a nice annotated timeline of Internet and e-commerce.

Does anyone know if the USPTO examiners are allowed to use Google Patent Search in their evaluation / review process?

  • Steve Bergstein

    So, Brad, when are you going to either become or hire a lobbyist to get some real movement on eliminating software patents? I agree with you that they're all or almost all bullshit – Greenspun just made the point in great detail.

    • http://www.feld.com Brad Feld

      Look for an announcement on the End Software Patents coalition in the next week or two. I'm also funding a full time person at CU Law to do real academic research on this (which is needed at this point to really make the point since all the research that exists is crap.) I have a grander strategy than just hiring a lobbyist – I've accepted that it'll take a while and needs to be a broad coalition based approach.

  • http://www.feld.com Brad Feld

    Here's a comment that underscores the absurdity of the situation. I received it via email from a reader.

    “My friend works at the patent office and they have been instructed not to use Google tools because “Google mines the search data to steal ideas.” The amount of technical review that they are able to do under their quota system is pitiful. No wonder the patent system is a mess.”

    Someone at the patent office is just missing the point.

  • http://www.kehle.com Joel Kehle

    Brad,

    You say software patents are evil. Agreed.

    When (if ever) are patents good?

    When (if ever) does a business founder have an obligation to their shareholders (i.e. investors) to seek intellectual property protection?

    These are important questions if someone is trying to build a new company, get funding or compete in the marketplace.
    Can you point me to any thought leaders in this area?

    Thanks!

    • http://www.feld.com Brad Feld

      I don’t believe software patents are ever good. The legitimacy of non-software patents varies dramatically – many are useful, productive contributions to protecting innovation.

      I’m not sure how to answer the “obligation to shareholders” question as it’s fundamentally a legal question where wording (in both the question and the answer) matters. In addition, strategy shifts over time as the patent dynamics evolve and other sources of IP protection (e.g. trade secret, copyright) emerge as relevant alternatives to patents.

  • Curious

    It is hard to judge the need for a Patent Office as it exists today. When the original Patent Office was created, communication took weeks or months or years, collaboration was limited by many factors (distance), and things that got patents were usually something with a solid manifestation.

    What was the goal of the patent in that world?
    I suppose that much of the goal was to encourage individuals to produce new and useful items. But this was in a world where communication was minimal and collaboration was hardy possible. Thus, an inventor would be able to get some reward for contributing to society.

    The also seemed to be a concept that creativity was an isolated effort. That is, one person or small isolated group would be able to create the thing being patented separately. However, as things have evolved, we now know that interaction over vast distances is easily accomplished and people enjoy contributing just for fun. That alone breaks the model upon which the patent system is based. An individual is no longer the sole creator of things. People contribute just to be a part of things. This was not possible before the communications era.

    The advent of the Internet, rapid transportation, and other forms of rapid communication has created a whole new universe. It is possible to individuals to make major contributions to societal efforts; for example, Linux, just because they want to. We have
    moved into a new world.

    What changes are needed in the patent process?
    I dislike negative rules but for a blog they will work for the moment. The wording is a bit lose also as lawyer like detail would fill volumes, probably unnecessarily.

    Nothing can be patented that is
    1)
    found in nature; for example, DNA or the like, whole or parts of living organisms, minerals or allied things (think what a patent on Iron Ore would do), etc..
    2)
    an effective interface to systems that are in or that become major interfaces to systems that humans or their agents interact with; for example, steering wheels in cars, point and click screen systems, etc.

    If something became a major interface over time, the existing patent is immediately deemed open for free licensing.
    3)
    a small change to an existing patent. That is, a new way to package a drug is not a new patent or a patent extension.
    4)
    something that is a derivative of public funding. This is something where public funding contributed to the initial breakthroughs leading to the idea. That is, academics cannot go out and start a company that patents ideas that they got while working in a publicly funded research area.
    5)
    an algorithm, period but especially those that arose from any form of public funding; academic work of any sort falls into this category. If the idea is related to or used any resources from a publicly funded institution; this includes graduate student and faculty funding, fellowships, assistance ships, etc.
    6)
    a business, research, or other process that is just an extension of practices that have been in use for years. For example, one cannot patent the concept of a “shopping cart” if it is done on the Web as opposed to in a grocery store. One-Click ordering is also not patentable since it is a trivial thing that was used for many other Web activities in the past. Prior art cannot be limited in such a way that just changing the venue of a current practice from one area to another justifies a patent.

    (There are more)

    ========================
    In what follows,
    government means all levels of government, from town to federal. It is all inclusive, that is, the government directly or for government contracts or for interactions with the government or for projects that include public funding of any sort.,
    ========================

    In addition to the above patent rules, the government should set a rule that no government agency or organization is allowed to use proprietary software for any tasks; for example, business software, word processing, databases (with some exceptions outside blog entry lengths), graphical programs for common tasks (needs definition), etc. This rule does not apply to things that are done for highly specialized tasks such as military, rarefied environments (space, deep sea, etc.), and allied areas, security systems, etc.

    Also, no software that uses a default proprietary file format may be used anywhere in the government. The government is not allowed to accept any documents in a proprietary file format; for example, *.doc or *.pdf formats. This includes resumes, major project proposals, user documentation, etc. If a new area that has previously not had an open availability file format arises, the providers of any software in that area will agree that the file formats will be made open to all without licensing or fees or their software cannot be used by the government.

  • http://intensedebate.com/people/bfeld bfeld

    Look for an announcement on the End Software Patents coalition in the next week or two. I'm also funding a full time person at CU Law to do real academic research on this (which is needed at this point to really make the point since all the research that exists is crap.) I have a grander strategy than just hiring a lobbyist – I've accepted that it'll take a while and needs to be a broad coalition based approach.

  • http://intensedebate.com/people/joel_kehle1953 joel_kehle1953

    Brad,

    You say software patents are evil. Agreed.

    When (if ever) are patents good?

    When (if ever) does a business founder have an obligation to their shareholders (i.e. investors) to seek intellectual property protection?

    These are important questions if someone is trying to build a new company, get funding or compete in the marketplace.
    Can you point me to any thought leaders in this area?

    Thanks!

  • http://intensedebate.com/people/steve_bergs2127 steve_bergs2127

    So, Brad, when are you going to either become or hire a lobbyist to get some real movement on eliminating software patents? I agree with you that they're all or almost all bullshit – Greenspun just made the point in great detail.

  • http://intensedebate.com/people/bfeld bfeld

    Here's a comment that underscores the absurdity of the situation. I received it via email from a reader.

    "My friend works at the patent office and they have been instructed not to use Google tools because "Google mines the search data to steal ideas." The amount of technical review that they are able to do under their quota system is pitiful. No wonder the patent system is a mess."

    Someone at the patent office is just missing the point.

  • http://intensedebate.com/people/bfeld bfeld

    I don’t believe software patents are ever good. The legitimacy of non-software patents varies dramatically – many are useful, productive contributions to protecting innovation.

    I’m not sure how to answer the “obligation to shareholders” question as it’s fundamentally a legal question where wording (in both the question and the answer) matters. In addition, strategy shifts over time as the patent dynamics evolve and other sources of IP protection (e.g. trade secret, copyright) emerge as relevant alternatives to patents.

  • Curious

    It is hard to judge the need for a Patent Office as it exists today. When the original Patent Office was created, communication took weeks or months or years, collaboration was limited by many factors (distance), and things that got patents were usually something with a solid manifestation.

    What was the goal of the patent in that world?
    I suppose that much of the goal was to encourage individuals to produce new and useful items. But this was in a world where communication was minimal and collaboration was hardy possible. Thus, an inventor would be able to get some reward for contributing to society.

    The also seemed to be a concept that creativity was an isolated effort. That is, one person or small isolated group would be able to create the thing being patented separately. However, as things have evolved, we now know that interaction over vast distances is easily accomplished and people enjoy contributing just for fun. That alone breaks the model upon which the patent system is based. An individual is no longer the sole creator of things. People contribute just to be a part of things. This was not possible before the communications era.

    The advent of the Internet, rapid transportation, and other forms of rapid communication has created a whole new universe. It is possible to individuals to make major contributions to societal efforts; for example, Linux, just because they want to. We have
    moved into a new world.

    What changes are needed in the patent process?
    I dislike negative rules but for a blog they will work for the moment. The wording is a bit lose also as lawyer like detail would fill volumes, probably unnecessarily.

    Nothing can be patented that is
    1)
    found in nature; for example, DNA or the like, whole or parts of living organisms, minerals or allied things (think what a patent on Iron Ore would do), etc..
    2)
    an effective interface to systems that are in or that become major interfaces to systems that humans or their agents interact with; for example, steering wheels in cars, point and click screen systems, etc.

    If something became a major interface over time, the existing patent is immediately deemed open for free licensing.
    3)
    a small change to an existing patent. That is, a new way to package a drug is not a new patent or a patent extension.
    4)
    something that is a derivative of public funding. This is something where public funding contributed to the initial breakthroughs leading to the idea. That is, academics cannot go out and start a company that patents ideas that they got while working in a publicly funded research area.
    5)
    an algorithm, period but especially those that arose from any form of public funding; academic work of any sort falls into this category. If the idea is related to or used any resources from a publicly funded institution; this includes graduate student and faculty funding, fellowships, assistance ships, etc.
    6)
    a business, research, or other process that is just an extension of practices that have been in use for years. For example, one cannot patent the concept of a "shopping cart" if it is done on the Web as opposed to in a grocery store. One-Click ordering is also not patentable since it is a trivial thing that was used for many other Web activities in the past. Prior art cannot be limited in such a way that just changing the venue of a current practice from one area to another justifies a patent.

    (There are more)

    ========================
    In what follows,
    government means all levels of government, from town to federal. It is all inclusive, that is, the government directly or for government contracts or for interactions with the government or for projects that include public funding of any sort.,
    ========================

    In addition to the above patent rules, the government should set a rule that no government agency or organization is allowed to use proprietary software for any tasks; for example, business software, word processing, databases (with some exceptions outside blog entry lengths), graphical programs for common tasks (needs definition), etc. This rule does not apply to things that are done for highly specialized tasks such as military, rarefied environments (space, deep sea, etc.), and allied areas, security systems, etc.

    Also, no software that uses a default proprietary file format may be used anywhere in the government. The government is not allowed to accept any documents in a proprietary file format; for example, *.doc or *.pdf formats. This includes resumes, major project proposals, user documentation, etc. If a new area that has previously not had an open availability file format arises, the providers of any software in that area will agree that the file formats will be made open to all without licensing or fees or their software cannot be used by the government.

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