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Tuesday, July 26, 2011

Software Patents

There's an hour long segment from "This American Life" called "When Patents Attack." It focuses on the rampant problem of patent trolling in the world of software patents and how far these patents have deviated from working "To promote the Progress of Science and useful Arts" and are working more to promote business models entirely built on buying up overly broad patents and then extracting money from actual innovators by forcing them to pay licensing fees. The program appropriate connects this business model to a protection racket, an old mob scheme in which local mafia would extort fees from local businesses in order to protect them. And if they didn't pay up, the mob would damage their property, burn down their building, physically assault them or such.

The scary thing is how often patents are issued with substantial prior art that should negate them. A patent is not supposed to be issued when some innovation is either obvious to others in the field or if there is prior art, namely that someone already figured out how to do it. Nonetheless, redundant patents are issued all the time. One patent they highlighted on the show Patent number 5771354, which was issued to a fellow named Chris Crawford in 1998, is a broad patent that covers things like cloud drive, online sales and automatic software updates over the internet. It should've never been issued because there was considerable prior art; and it contains nothing non-obvious since any programmer could easily figure these things out. In fact, it overlaps with a great many other issued patents. According to a software search, there were 5,503 active patents at the time this patent was issued that covered the same innovations. And yet the patent was issued and is now valuable and is being used to extort money from companies that were easily able to come up with these innovations without even being aware of this patent's existence. And this is no anomaly. An estimated 30% of patents are issues for already patented inventions.

At the very least a reform of the system of issuing patents needs to be considered, such that patents that should be negated on grounds of prior art and obviousness aren't issued so frequently. Though it also tempts one to think that the idea of software patents are a bad idea to begin with, and that we should return to the old program where software was only covered by copyright.

Added: Kent Walker, Google’s Senior Vice President & General Counsel talked with TechCrunch yesterday about patents and the big Nortel Patent Auction Google was involved in. He sees patents system as failing to encourage innovation, noting:
When you see a lot of [Venture Capital] money flowing into the acquisition and holding of patents, it’s a problem. These are not companies doing new things, they’re buying them. You see hundreds of millions and billions of dollars flowing in to exploit others
An average patent examiner gets 15 to 20 hours per patent to see if it’s valid. It can take years to go back and correct mistakes.

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