The whine-a-thon over software patents---especially in the wireless industry---has reached a fever pitch, but there's little chance of anything actually being reformed any time soon.
Let's recap a few data points over the last week.
- Google goes off about how the wireless industry ganged up on Android via the patent system.
- The reaction to Google was predictable. Microsoft mocked Google. John Gruber said that Google's response was laughable given that it wouldn't have yapped about patents if it had won Nortel's 6,000 patents. Danny Sullivan gives the Google side of the case.
- Mark Cuban noted that his portfolio companies are spending more time with lawyers over patents than actually doing real work and creating jobs.
- And the lawsuits keep flying. Patently Apple notes that Apple is being sued over a patent originally owned by LG Electronics. Meanwhile, Google, which has a massive intellectual property headache over Android and appears to be facing some serious risks in its Oracle lawsuit.
It's fairly obvious that patents are the new tactical nukes in the technology industry. Companies want to grab patents largely to defend lawsuits than actually create anything. The companies with the most patents win.
Short of some cross industry disarmament policy---something that won't happen---there will have to be some reform on the patent front.
Among the options:
- Ban software patents completely. Some folks will argue that software patents are bunk. Cuban argues that software and process patents should be banned. The whole ban software patents thing is a tad unrealistic.
- Reform the system. Patent reform has been on the radar for years. Nothing meaningful happens. Cuban noted:
It’s bad for my little companies. It’s horrific for bigger companies. It’s so bad that major tech companies are buying big collections of patents not because they want to own the intellectual property but rather because they want the ability to respond to patent lawsuits with a lawsuit of their own. It’s like playing a game of thermo nuclear war. If all sides have “nuclear patents” they can respond to patent litigation with equal force. In other words, if you have enough “nuclear patents” no one will sue you for patent infringement because you have enough power to respond in kind. It’s crazy and costing this country jobs.
Google just bid $900mm to buy a patent collection. Those patents ended up being sold for $4.5BILLION dollars. That is money that for could have gone to job creation.
And now the reality: Nothing is going to happen. Congress is a mess. Patents will always take a back seat to things like making interest payments, debt downgrades, elections and an economy that is sucking wind.
As a result, the thermo nuclear patent game will continue. Companies can whine about lawsuits and sky-high bids for patent portfolios all they want. Their time may be better spent acquiring patents.
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