Patents, Commons, and Anti-Commons

Yippee – the criticism of the software patent stupidity is starting to heat up and some really smart people are making both useful arguments about the issues and interesting proposals about the solution.  In addition, there are some general articles starting to appear that explain that while patents (and property rights) have an important role in our society and in encouraging and supporting innovation and entrepreneurship, there are some well understood problems that emerge from patenting small components of complex systems – especially when the vector of innovation is steep (like – for example – with software or the Internet.)

James Surowiecki has a great short article in the New Yorker Magazine titled The Permission ProblemIn it, he gives a great example of what Columbia law professor Michael Heller calls the "anti-commons" in his book The Gridlock Economy: How Too Much Ownership Wrecks Markets, Stops Innovation, and Costs Lives.

"In the second decade of the twentieth century, it was almost impossible to build an airplane in the United States. That was the result of a chaotic legal battle among the dozens of companies—including one owned by Orville Wright—that held patents on the various components that made a plane go. No one could manufacture aircraft without fear of being hauled into court. The First World War got the industry started again, because Congress realized that something needed to be done to get planes in the air. It created a “patent pool,” putting all the aircraft patents under the control of a new association and letting manufacturers license them for a fee. Had Congress not stepped in, we might still be flying around in blimps."

The anti-commons is a great reference point for what has happened with software patents.  Simply put, if too many people own individual pieces of a valuable asset – especially if those pieces are overlapping and vaguely defined (e.g. software) – you can end up with gridlock instead of innovation.  Surowiecki explains:

"When something you own is necessary to the success of a venture, even if its contribution is small, you’ll tend to ask for an amount close to the full value of the venture. And since everyone in your position also thinks he deserves a huge sum, the venture quickly becomes unviable."

So – we have (a) Google Sued For Patent Infringement For Keeping Track Of How Many Ads People Click OnAt the same time, we have (b) U.S. Patent Office Rejects All Ninety-Five NeoMedia Patent Claims.  For those of you uncertain about my perspective, (a) is bad.  (b) is good.  Hopefully (b) motivates the folks at Google to fight like hell to invalidate silly patents, rather than take a "let’s retrench and patent everything in sight" position.

Finally, I read an article by Timothy Lee on Ars Technica last week titled Patent Office finds voice, calls for software patent sanity.  We need smart people to step up, shout from the rooftop about how fubared the software patent system is, and provide real alternatives.  I’m optimistic that this is finally starting to happen.