451 Group: Microsoft suing TomTom, not Linux, not open source

Posted Mar 3, 2009 10:25 UTC (Tue) by Seegras (guest, #20463)
In reply to: 451 Group: Microsoft suing TomTom, not Linux, not open source by dwon
Parent article: 451 Group: Microsoft suing TomTom, not Linux, not open source

"How do software patents encourage innovation again, in actual practice?"

The question can be asked far broader:

"How do patents encourage innovation again, in actual practice?"

And the answer is: The don't. There were some effort to prove this statistically, but all investigations turned up this is NOT SIGNIFICANT. So there is absolutely no proof that patents encourage innovation. neither is there that (also in the broad field, not only software-patents) that they stiffle innovation.

However, another investigation turned up the fact that the only field where revenues from patents are higher than the legal costs associated with them are pharmaceuticals. So even if patents do not stiffle innovation, they are everywere but in the pharmaceutic industry JUST LEGAL OVERHEAD.

Patents can be used for corporate warfare, of course, but does the state really need to maintain a patent-system whose only benefit in most industries is to pay rents for lawyers and to serve to provide ammunition for corporate warfare?

451 Group: Microsoft suing TomTom, not Linux, not open source

Posted Mar 3, 2009 12:14 UTC (Tue) by dlang (guest, #313) [Link] (1 responses)

when you talk about studies relateing to revenues from patents vs the legal costs associated with them, are you just looking at the revenue from licensing the patents? or are you looking at the revenue that companies get from selling items that include patents that they own?

if you don't include the revenue that companies get from selling items that include their own patents, and the fact that without patents they may not sell as many, if any of those items (due to competition that is prevented by the patent) then you are just cooking the numbers to make your own point.

How do patents encourage innovation?

Posted Mar 6, 2009 17:37 UTC (Fri) by anton (subscriber, #25547) [Link]

if you don't include the revenue that companies get from selling items that include their own patents, and the fact that without patents they may not sell as many, if any of those items (due to competition that is prevented by the patent) then you are just cooking the numbers to make your own point.

His argument may not be convincing, but that's far from cooking. If the patent really was innovative, one would expect other companies to license the patent, and there would be significant revenues from licensing.

And that still would not prove that the patent encourages innovation; the products based on the patent would be more expensive, so there would be less and probably fewer products, reducing the benefit of the innovation (that's what a monopoly does for you). If the innovation would have come about without the patent (as most patented innovations have), then the effect of the patent is exclusively negative.

Concerning revenue from "items that include patents they own", how would you count that? There is no way to know if an item "includes" a patent in general. And if that revenue was lower without the patent due to competition, then the consumers of these items or their competition would have paid a lower price, and probably bought more items, increasing the value coming out of the innovation.