A Survey of the State of IP

An anonymous reader writes "This week's Economist has a number of stories in its survey of the state of IP (link to lead article), written from a balanced, business-oriented perspective. If you do not have a web subscription it is worth picking up a newsstand edition, if only to read a defense of open source from being seen as a 'flaky, radical, pinko strategy not related to the competitive marketplace'." From the article: "In recent years intellectual property has received a lot more attention because ideas and innovations have become the most important resource, replacing land, energy and raw materials. As much as three-quarters of the value of publicly traded companies in America comes from intangible assets, up from around 40% in the early 1980s."

nice

[Anonymous Coward]

from the article:

"Already, businesses are having to negotiate with other firms in order to do basic things such as reading files from different proprietary formats; and the design of new technology products now involves lawyers as well as engineers. The proliferation of patents might prove a serious encumbrance to businesses, just as travellers along the Rhine in medieval Europe were slowed down by having to pay a toll at every castle.

James Boyle, a legal scholar at Duke Law School in North Carolina, claims that the current increase in intellectual-property rights represents nothing less than a second "enclosure movement". In the first enclosures, in 18th- and 19th-century Britain, the commons--open fields used by many, belonging to all, owned by none--were fenced in, and nearly all land became private property. By analogy, the granting of property rights on ideas, to the extent it is happening today, is plundering the intellectual commons of our public domain. "

amen

Surpised at the Economist..

[xtal]

They're usually more on par with energy problems and it's relation to the global economy. No cheap energy, no economic growth - that's not economic theory, that's PHYSICS.


"In recent years intellectual property has received a lot more attention because ideas and innovations have become the most important resource, replacing land, energy and raw materials"


I bet my entire life savings against that statement last year. Go look at a energy fund index and tell me I was wrong. Everything - land, raw materials, and IP is about energy. The cheap energy is running out, and the people who have it are doing very, very well at the moment.

If IP is the future.. well, I guess I have a couple years to go back and get a law degree. Here's another tip for the economist: Lawyers don't produce capital. They are a legislated tax on a free market.

Perspective of a Company Developing IP

[SkiifGeek]

When establishing my companies, I made sure to separate the IP R&D from the commercialisation processes. Although a lot of the research that is coming out of the R&D company is patentable, the decision whether to patent has been a long and well thought out process.

Ultimately, a lot of the research will be protected under trade secret and standard copyright law. The process of patenting requires disclosure of methods and techniques (even with legalese), and places a small company in a bind when larger companies can infringe at will (when the cost of compliance is less than the profit they will make from infringement). By definition, the patent allows one skilled in the art to recreate the invention, so it puts on public record the specifics to allow a competitor to recreate the result that has come from our significant effort and expenditure.

While we hold nothing against software patents (when issued properly), we do have major concerns about the patent process, and the ability to patent processes instead of inventions. When the next global superpower, and some of the largest companies in the industry, have a history of subverting IP restrictions to suit their own ends, the presence of a patent only stops the honest from ripping off the work we have carried out (and they are getting fewer and fewer in number).

Even in discussion with the patent office, and the Government body established to promote and assist the patent process, they readily admit that the model is broken, but it is the best we have at the moment - so we need to keep supporting it (which is a cop out if I have ever heard one).

Without a warchest of millions to fight legal battles, or huge patent holdings, the little guys are running on hope that no one picks their patent for willful infringement.

Probably the best advice for people involved in IP development - get yourself good legal counsel (even at the start of the research process), and remember that there is more than one way to achieve the same outcome (so if you get sued for an implementation - change it to something else).

statistics don't lie in this case..

[plasmacutter]

ideas and innovations have become the most important resource, replacing land, energy and raw materials. As much as three-quarters of the value of publicly traded companies in America comes from intangible assets maybe this has less to do with the fact that IP has become more numerous or "important", and more to do with the fact that recent extensions to both the breadth and lenght of copyright has produced an inordinate amount which actually surpresses the production of more tangible goods. Let me explain: if you're afraid of being litigated into the ground due to patent issues, you won't produce. If a system of mining is patented that makes extraction of current natural resources more expensive, and might result in the premature shutdown of a mine which may yet have productive capacity. I'm sure someone more educated than myself on the raw material marketplace could produce more examples, and there are plenty of examples of IP getting in the way of innovations which very well may be physical. I think rolling back IP or perhaps a universal worldwide backlash against more extreme forms of IP may restore some balance. Personally i don't like the idea of the economy being based on "intangible goods". Besides being tantamount to "faith based", it would also mean my nation of origin is surely on the decline, since her educational institutions are among the world's worst, and both R&D workers and spending are diminishing.

Thats enough, no more IP!

[burnin1965]

"In recent years intellectual property has received a lot more attention because ideas and innovations have become the most important resource, replacing land, energy and raw materials. As much as three-quarters of the value of publicly traded companies in America comes from intangible assets, up from around 40% in the early 1980s."

Wrong, the reason intellectual property has been recieving a lot more attention is because its the easiest way to milk capital from a technology dependant society without having to actually produce anything. Don't get me wrong, there are some valid legal complaints in the courts but, as most people here have noted over and over again, many of the companies submitting these complaints don't actually produce anything, they simply lay claim to some idea, label it as Intellectual Property, and make plans to profit from the work of others.

This whole Intellectual Property scam has got to go. So keep these concepts in mind in your day to day workings:

Copyrights are not Intellectual Property. Somebody did some significant work to express a story, a concept, an solution, whatever, in a written document, a film, a painting, a song, etc., and once the expression was completed the duplication of that expression is easy and inexpensive due to the technology we have for duplication and distribution. The copyright provides protection to those who expressed the work, however, the expression is NOT INTELLECTUAL! Its a peice of paper, a plastic disk, magnetic media inside a harddrive, its no longer intellectual. Since it is so easy to duplicate the work that has been done a copyright is a nice protection to those who did the work so that they may have some say over the duplication and distribution. If however, somebody comes up with a similar idea or is even influenced by someone elses expression and they go through and do the work over again then they have not infringed on anyones copyright or intellectual property.

Trademarks are not intellectual property. If you concieve a name, an image, whatever, and you express that conception onto paper, in writing, in any way, and you register it as your trademark then you can use the registration to ensure that others do not use your trademark in ways that would confuse others as you or your product. However, again, this physical thing which is an expression is no longer intellectual. The final product, the trademark is not some intangible asset, if it was intangible it would be useless.

Patents are not intellectual property. You come up with an idea and build a prototype or write down a conceptual design and present this for registration at the patent office so you will have the opportunity to profit from the idea by producing an end product. And once again none of the end results are intellectual, they are hard cold physical results. Even software code is physical, the CPU doesn't read your mind to run the code and the RAM and harddrive on which it is stored is not some magical ethereal thing, its a tangible chunk of hardware you use when you do the work of turning the ideas into something.

I think this entire intellectual property circus is just a scam to confuse the masses and make them believe that any thought in their head belongs to some corporation somewhere for whom they should be working. And nobody should be attempting to do any work outside of what they do for the corporation as that would in some way be stealing some "intangible asset" from the company. Well forget it, its just one big smoke and mirrors freak show designed to rape the masses for every penny they have and any penny they may ever have.

I mean really, can you believe this crap, "As much as three-quarters of the value of publicly traded companies in America comes from intangible assets". Does anybody really believe that everyone is paying all this cash to companies in America because some marketing guy, the salesman, and the chair slinging CEO said "I have this great idea, and if you pay me I'll tell you wh

Re:You lost me . . .

[ScentCone]

No, sorry. The "don't care what businesses think" crowd shares a lot of members with the "Windoze is teh Suxx0r" crowd that can't understand why more people don't use Linux. When people use something every day at work, they're a lot more inclined to feel comfortable with it at home, sending picture of the kids to grandma, playing games, using eBay, etc. Wide adoption of non-MS stuff by large corporate users is a huge step towards making millions of people more comfortable with it at home. That will also showcase the various distros' shortcomings and add more fuel to the fire. Of course I realize that idiots who don't see the big picture and can't bring themselves to think two minutes into the future for a glimpse of it won't get it. But if pointing out reality helps even the occasional person get it, then my work here is done. Well, not really. But I've at least ranted ever so slightly less pointlessly into the howling winds of nerdly piousness and anti-pragmatism.

Wrong

[bluGill]

Everything is about Food, shelter, clothing, and entertainment. More or less in that order. (though you can argue about the order of shelter and clothing)

Energy is a factor in several of them, but not in itself a basic need. You need energy for anything more than subsistence farming. You need energy for heating your shelter. You need energy to create clothing by modern process. (I'm not counting human input as a part of energy for this - though clearly that is a form of energy).

If there is too much rain, crops will die of overwatering, no matter how much energy you have. However if there were crops that could stand this over watering, and you bet your life savings them, you would have the same effect, even though energy was not a significant factor.

Despite your wish to think otherwise, energy is a much smaller part of the economy than previously. Now it was one of the (if not the) fastest growing parts last year, but will that continue? IP is growing too, and could replace energy. All it takes is a breakthrough in ethanol/biodiesel producting and energy will go down, while IP goes up farther (fueled by the breakthrough.

Personally I'm betting on such a breakthrough coming along fast. Though not with all my assets. Ethanol is already energy positive by .34, and shows promise of getting over 1 (that is for every energy input we get 2 out). Biodiesel can reach 3 in the lab. If I'm right, energy will have a short blossom, and then fade again like it has been for years. I've been wrong before though.

Re:Thats enough, no more IP!

[Anonymous Coward]

Hear, hear! I'd much rather be competing to sell my homemade DVD rips of Spider Man on the street for a living than creating new movies. Or playing search engine games trying to eke out an existence with a site full of ads hosting a copy of an old John Grisham novel rather than writing an original one. Or finding the latest unknown artist and "helping" to "promote" his work by hosting it myself with a bunch of porn links on the sidebar instead of developing drawing or painting skills, creating new artwork I can sell or license.

IP laws must be abolished!!

Re:IP - the anti-christ of free markets

[argoff]

With all due respect, we have had over 200 years to tweek, implement, and fine tune the patent system. This is not an implementation problem, it is a fundamentals problem. Patents are going to hell just at they are being brought to their logical conclusion. It is not morally or fundamentally ok to controll how people use invnetions and discoveries. Perhaps I have a good sounding reason to controll peoples free speech too, so what.

Re:Ring-fencing, the blindingly obvious, etcetera

[oliverthered]

RIM's Blackberry troubles stem from patents on the wireless transmission of email.

There are a hell of a lot of patents of the form:
1. Take something that people are doing today
2. Insert the word computer
3. File for a patent
4. Profit

I think that the length granted to a patent should be proportional to the amount of time developing the invention, maybe the patent lasts for twice the invention time with a 10 year cap, that way drugs and small time inventors would probably get the whole 10 years, but Microsoft would only get a couple of weeks for some of it's patents. I'm not quite sure how calculating development time would work in pactice though.

Re:IP - the anti-christ of free markets

[argoff]

How can one find these 150 year old arguements? A true comparison might turn out to be a powerful tool.

It's hard to find many of them, but I've done a lot of reading about that era for just this purpose.... the most paralels happen with copyright, because the patnet system hasn't really been competely commoditized yet. (watch out for the replication age)

Then: During the early 1800's it appears that many people believed that the entire meaning and purpose of the industrial revolution was use inventions like the cotton gyn to make their slaves 1000 more productive and thus free them up to expand their plantations for huge profits.
Now: Today there are many people who believe that the entire meaning and purpose of the information age is to leverage inventions like the internet to impose their copyright holdings to the far ends of the earth for unlimited growth and profit.

Then: arround 1850, there was a speculative stock market crash, as people invented in all sorts of models for how to make money with indiustrial technology.
Now: In 2001, there was lots of crazy speculation on new information technology and a following crash.

Then:People called slaves a property right, even though they were clearly nothing like regular property.
Now:People call copyrights a property right, even though they are clearly nothing like
regular property.

Then: In the early 1800's there was an agreement called the "missouri compromise" that basicly held off the factories in the north from the plantations in the south from having al all out fight about the slave issue.
Now: Today, there was the DMCA which was sorta of a detant between hollywood and the tech indsutries.

Then: The south eventually tried to fence themselves off from the rest of the world by breaking from the union.
Now: The media industries are trying to fence themselves off using DRM.

Then: It became illegal to teach a person of color how to read.
Now: Copyright violations can be punished worse than rape.

Then: Slavery used to be short term indnetured servitude that wasn't inherited, but was extended to last forever.
Now: Copyrights have effectively been extended to last forever.

There are some important differences though:

Then: there was a well defined north and south
Now: there is no defined territories, just a tech industry and a content industry.

Then: Physical controll of slaves requires physical violence
Now: Information can't be controlled physically, but it can be controlled with brow beating, threats, lies, suits, etc .... [warning: when the patent problem comes of age as "replication" technology gets more advanced, that IS a physical implementation and likewise imposing them WILL eventually require physical violence - and notice that some of the consequences of patents are far more physical, like millions of Africans dying because attempts to make generic AIDS drugs were attacked]

Then: The government of the north was on the correct side.
Now: Government seems to be more accountable to the media than to freedoms - it is a tough call.

Energy versus brainwork

[Beryllium Sphere(tm)]

But note that the richest man in the world got that way by selling 1's and 0's, not by selling hydrocarbons.

Notice further that it's only because of inventions and improvements that the energy is getting from rock formations into gas tanks.

After rain and wild berries there are very few natural resources. Everything else is the result of humans inventing agriculture, irrigation, mining, hunting weapons, and ranching.

The Patent Problem: A Question of Centralization

[naasking]

The whole patent problem can be reduced to a single point: the patent system, as currently implemented, does not scale, both in registration (filing for patents), and in resolution (resolving disputes). This is the natural result of trying manage a decentralized process (R&D) with a centralized system (patents); we are feeling these effects the most now, because of the drastic increase in the importance of information.

There have been a number of solutions to this problem proposed, including eliminating patents altogether [homeip.net], or significant patent reform of some kind. Both could resolve the situation.

However, one thing is clear: the problem is one of scaling a centralized system. Each patent that comes in requires decoding from legalese, and comparison with every other patent in the system that was ever recorded for prior art. For you programmers out there, that's an O(n) algorithm. 'n' is very large nowadays. 'n' will continue getting larger. Without managing this complexity in some sort of structured fashion, it will inevitably become unmangeable, just like any poorly chosen algorithm. If this is the best we can hope to do, then we have to scale our efforts at O(n) to keep up with the growth (funding, man power, etc.).

I think they could do better. Heck, hire Google properly index some the patents and come up with an appropriate process for the examiners. Personally, I prefer as little intervention as possible; in other words, a decentralized system, which can scale with decentralized development, or no patent system at all; the patent system imposes significant hidden costs to the economy via litigation and lost time. But a centralized solution can work, as long as it is designed to scale properly.

Now all you smart computer scientists, programmers, hackers, and mathematicians, let's hear some decentralized and/or scalable solutions; that's what we really need if we want to keep patents around. :-)

Clueless As Usual

[Master of Transhuman]

"firms increasingly rely on innovation to remain competitive. Yet the return on investment in R&D is short-lived because more people innovate at a far faster pace than before. That means margins have shrivelled, explains Ragu Gurumurthy of Adventis, an IT and telecoms consultancy. "How to recoup the cost of innovation? By licensing the technology," he says."

In other words, we don't know how to compete by innovating and marketing, so we're going to stop innovating and use the state to make our money for us.

Typical corporate thinking.

Guess what?

[Phantasmo]

Guess what? If you're calling it Intellectual Property, you're already siding with the people who abuse the copyright and patent systems. Intellectual Property is not a legal term. It was invented by people and organizations that control large bodies of copyrighted work and patented "inventions" who work very hard to resist the public domain.
It's all about controlling language. When you say "tax relief," you're asserting that taxes are a burden. When you say "Intellectual Property," you're asserting that copyrights, patents and trademarks are property (they're not) and that they're all fundamentally the same (again, they're not). That's why copying a CD results in being charged with copyright infingement, rather than theft (as the music industry calls it - another attempt at controlling language).