Rackspace sued for hosting GitHub [LWN.net]

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 19:38 UTC (Tue) by jackb (subscriber, #41909) [Link]

If this trend continues at some point the only profitable way to start up a new software company will be to operate it anonymously as a Tor hidden service.

All this Imaginary Property rent-seeking does in the long term is drive new innovations into the darknet.

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 21:32 UTC (Tue) by khim (subscriber, #9252) [Link]

If this trend continues at some point the only profitable way to start up a new software company will be to operate it anonymously as a Tor hidden service.

It'll not work: you still need to somehow pay the salary and investors will probably not want to deal with an illegal company.

All this Imaginary Property rent-seeking does in the long term is drive new innovations into the darknet.

Not really. They will probably push software development to China where it'll be controlled (to some degree) by government, but since government (even Chineese government!) is easier to placate then patent trolls…

The solution (which couple of years ago sounded like a joke and year ago looked like far-fetched extrapolation) becomes more and more real as time goes on.

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 21:36 UTC (Tue) by jackb (subscriber, #41909) [Link]

It'll not work: you still need to somehow pay the salary and investors will probably not want to deal with an illegal company.

Proof by counterexample.

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 21:44 UTC (Tue) by khim (subscriber, #9252) [Link]

We were able to determine that Silk Road indeed mostly caters to drug users (although other items are also available), that it consists of a relatively international community, and that a large number of sellers do not stay active on the site for very long.

What this has to with github or investors? Yes, dark market does exist and will exist. I doubt it'll be ever used for low-return things like software development: you need profits measued in thousand percents to make it worthwhile.

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 21:52 UTC (Tue) by jackb (subscriber, #41909) [Link]

The need for outside investment in the first place is inflated by artifical barriers to entry into the market.

As the barriers to entry increase the value proposition of using technology to bypass them also increases.

It starts with drugs because that's where the incentives are highest, but given enough time and opportunity the patent trolls and other rent seekers will make it profitable to move more businesses into the darknet as well.

Rackspace sued for hosting GitHub

Posted Sep 18, 2012 21:55 UTC (Tue) by jackb (subscriber, #41909) [Link]

This isn't specific to the software industry - it's part of a larger trend in the overall economy.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 0:16 UTC (Wed) by khim (subscriber, #9252) [Link]

As I've said: black market always existed and will always exist. It does not mean government will tolerate it. Well, some governments do, but they don't last long.

The problem with so-called “System D” is that it's much, much, much less efficient other approaches. In a world where software must be developed in a darknet not a lot of software will be produced. Take the article you are linking to. "Lagos is a city for hustling," he told me. "If you have an idea and you are serious and willing to work, you can make money here. I believe the future is bright." Wow. The power of “System D”! The world where people steal from legal oil-based economy, waste 90% of resources in the process and still have something to live with. The only problem: all that works only where there are normal economy to plunder.

If you want to look on the final of the “System D” triumph then take a look on Baltic states. As long as they had the ability to pillage transit they showed excellent promises. When the "legal economy" contracted “System D” went nowhere as well.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 12:05 UTC (Wed) by copsewood (subscriber, #199) [Link]

There are plenty of places outside the US other than China which have more sensible patent laws. A server hosting company is one of the last kinds of operation which can relocate or go anonymous on Tor due to bandwidth and latency issues, so a much more probable solution if Rackspace don't want to fight the lawsuit is for Github to be hosted in Europe by a hosting company with no US office.

There have been some crazy and highly offensive extraterritoriality in the reach of US law recently, but I really don't see the US cutting connections to those who don't respect US patents in the same manner as has more reasonably occurred in respect of online gambling sites, and if they do that in respect of ignored patents then people outside the US will increasingly ignore the US market as irrelevant to our interests.

Frankly looking at it from this side of the pond, the only relevant question here is how much unemployment and lost business the US wants before the US population force their representatives to clean up patent law as affects software.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 22:34 UTC (Wed) by khim (subscriber, #9252) [Link]

There are plenty of places outside the US other than China which have more sensible patent laws.

"Sensible patent laws" is just one ingredient. Another one is "large domestic market". Thus China is the primary candidate: other countries are just not big enough.

Why is it important to have large domestic market? Easy: in this case you can develop all the patent-encumbered technologies you want without thinking about patents at all till you are big enough and is ready to go and kill your US competitors. Otherwise US trolls just squeeze your customers instead of you.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 11:18 UTC (Wed) by carlopiana (guest, #85127) [Link]

In this Europe is a little bit on a more service providers friendly area, since nobody in their mind would have sued the company hosting a third party's service for what the third party offers. Not because Europe has in theory a legislation against software patents (and I believe it's quite difficult to argue that source code is not "software as such"), but because we have an express liability exclusion for service providers, interpreted quite strictly by the European Courts.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 13:07 UTC (Wed) by debacle (subscriber, #7114) [Link]

Thanks for Imaginary Property. It was new to me.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 14:21 UTC (Wed) by jackb (subscriber, #41909) [Link]

If Intellectual Property Is Neither Intellectual, Nor Property, What Is It?

Rackspace sued for hosting GitHub

Posted Oct 2, 2012 17:08 UTC (Tue) by Rudd-O (subscriber, #61155) [Link]

I've been calling it Intellectual Poverty myself.

Rackspace sued for hosting GitHub

Posted Sep 19, 2012 17:03 UTC (Wed) by drag (subscriber, #31333) [Link]

> If this trend continues at some point the only profitable way to start up a new software company will be to operate it anonymously as a Tor hidden service.

No.

> All this Imaginary Property rent-seeking does in the long term is drive new innovations into the darknet.

What it actually means is that companies will re-locate out of the USA into countries that have less IP restrictions, continue to develop software, and then hire lawyers to represent them in the USA and file patents and sue the shit out of software companies still stupid enough to be based in the USA.

Since they are immune from USA laws themselves, since they are not doing business in the USA, then USA software companies with patent portfolios will be forced to into unfavorable cross licensing agreements. Once that happens then foreign software companies will be able to start to legally do business in the USA.

There already going on and it's been going on for a while. It's going to get worse and worse.

The USA is pushing IP laws through international treaties to try to cut off countries that don't honor the IP laws. But this is not going to last long once other country's government's start to realize how much of a huge competitive advantage their corporations will have over USA corporations by ignoring IP BS. IP laws are a huge drag on innovation and USA regulations cause a massive overhead on any corporation operating in the USA. If companies can avoid this then even small companies can leapfrog around much larger and much richer competitors.

Unfortunately this also means that USA government will become much more violent and aggressive in forcing compliance. We don't have 737 military bases spread across the world in most major countries and all major regions for no reason.