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James Bessen's Latest Paper on Software Patents
Monday, June 27 2011 @ 04:00 PM EDT

Anyone who has studied software patents and the debate about their utility has surely run across the work of James Bessen. We have certainly mentioned his past papers co-authored with Robert Hunt, Michael Meurer, and Eric Masking, and the Bessen/Meurer book, Patent Failure, takes an in-depth look at why our U.S. patent system does not work well with certain technologies, particularly software. Prof. Bessen has a new paper out entitled "A Generation of Software Patents." Not surprisingly, in the paper Bessen writes that "it is hard to conclude that software patents have provided a net social benefit in the software industry."

This paper is largely a compilation and survey of the literature on software patents, both for and against, that has published over the last several years, and it contains a number of useful nuggets. For example, while some have asserted that patents are important to software start-ups (see, High Technology Entrepreneurs and the Patent System: Results of the 2008 Berkeley Patent Survey, Stuart Graham et al, 24 Berkeley Tech. L.J. 1255, 1270-71 (2009) [PDF], in which they found "67% of software startups backed by venture capital held patents", Ron Mann conducted a regression analysis and found that “patenting practices have at best a minuscule ability to predict the success of a venture-backed software startup.” (See, Ronald. J. Mann & Thomas W. Sager, Patents, Venture Capital, and Software Start-ups, 36 Res. Pol'y 193, 197 (2007) [PDF]. Suffice it to say, there is some worthwhile reading in this paper and the various works referenced in it. Enjoy.

  


James Bessen's Latest Paper on Software Patents | 30 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections here
Authored by: jplatt39 on Monday, June 27 2011 @ 04:17 PM EDT
If any.

[ Reply to This | # ]

Off-topic here
Authored by: jplatt39 on Monday, June 27 2011 @ 04:19 PM EDT
Make links clickable. On-topic comments will be ignored. Read the Important
Stuff at the bottom of the Post a Comment page. Remember, Preview is your
friend.

[ Reply to This | # ]

Newspicks here
Authored by: jplatt39 on Monday, June 27 2011 @ 04:20 PM EDT
Please use the title of the Newspick for the item you are commenting on.

[ Reply to This | # ]

Comes thread here.
Authored by: jplatt39 on Monday, June 27 2011 @ 04:21 PM EDT

[ Reply to This | # ]

James Bessen's Latest Paper on Software Patents
Authored by: Anonymous on Monday, June 27 2011 @ 09:27 PM EDT
I look forward to the day when lawyers, judges and more
importantly congress understand that patenting software is
the equivalent of patenting legal defense theories or
methods of appropriating federal tax dollars for localized
political interests (pork). They are removing entire swaths
of mathematics, algorithms, expression and language from our
discipline in arbitrary and impossible to grok ways with
patents on the trivial solutions to everyday problems.

After a lawyer is sued for $20 million for utilization of
the patent 1234 "innocence by virtue of insanity" or patent
12345 "unjust enrichment" in the defense of their clients,
perhaps the legal professions will understand the difference
between algorithms, logic, language and inventions deserving
of a patent.

Valid or not (from a legal perspective), every day software
engineers are almost certainly infringing on thousands of
patents whose inventions are trivially replicated for which
the validity and applicability can only be determined after
millions of dollars in legal fees.

If an software engineer were so foolish to attempt to
determine whether or their work on Monday violated some
patent, there is effectively no chance a search of the (from
an outside perspective) purposefully obscured legalese of
granted, extended, and kept alive past the shelf life of
Twinkies patent applications would allow one to say
definitively yes or no a patent has been violated.

A patent system can not function where a single person can
innocently and unknowingly violate tens or thousands of
patents in a single day of work solving every day problems.

[ Reply to This | # ]

An aquarium hypothesis
Authored by: IMANAL_TOO on Tuesday, June 28 2011 @ 06:03 AM EDT
When I read Mann & Sager (2005) I was struck that they concluded
One way to understand the data is that the existence of patents is much more important to a firm’s success than the number of patents that it has, and that the number of patents depends on the nature of the technology.We draw some tentative support for that point from the consistency with which our data illustrated that the performance variables had a more significant relation to the patent/no patent variable than to the number-of-patents variable.
and
Although we cannot answer the ultimate welfare question – would the industry be better without patents than it is with patents – we do shed a great deal of light on the reasons why so many firms do – and do not – choose to expend the time and resources necessary to obtain patents to protect their innovative work.
In an aquarium hypothesis these examined sharks live in a software patent aquarium, the US market. Can you really examine these from a non-patent perspective (cf. Gödel)? Even the 76% which do not have any patents in the US market do have to compete with those who have.

I guess one would need to re-examine the issue and compare the successful and unsuccessful, venture and non-venture software companies in the US with the non-patent aquaria of the European and Asian markets.

Otherwise I cannot see how to estimate the relevance of patents, venture money, success to a non-patent situation. Maybe Bessen discusses this, I haven't read it yet.



---
______
IMANAL


.

[ Reply to This | # ]

Function of Patents in S/W Startups
Authored by: Anonymous on Tuesday, June 28 2011 @ 07:41 AM EDT

From the business start up courses I have taken, no one has said that Patent's improve a companies chances of success. Instead, the arguments for patenting are:

Patents give the company leverage when they become involved in Patent Suits / Patent Licensing.
and
Patents provide the venture capital company with an asset in the event the company closes.
The exit strategies for the venture capital firm is to sell the patent, and/or to become patent trolls.

[ Reply to This | # ]

  • Hmmmm... - Authored by: Anonymous on Tuesday, June 28 2011 @ 01:50 PM EDT
Answering the right question...
Authored by: Anonymous on Thursday, June 30 2011 @ 04:21 AM EDT
For example, while some have asserted that patents are important to software start-ups (see, High Technology Entrepreneurs and the Patent System: Results of the 2008 Berkeley Patent Survey, Stuart Graham et al, 24 Berkeley Tech. L.J. 1255, 1270-71 (2009) [PDF], in which they found "67% of software startups backed by venture capital held patents", Ron Mann conducted a regression analysis and found that “patenting practices have at best a minuscule ability to predict the success of a venture-backed software startup.” (See, Ronald. J. Mann & Thomas W. Sager, Patents, Venture Capital, and Software Start-ups, 36 Res. Pol'y 193, 197 (2007) [PDF]. Suffice it to say, there is some worthwhile reading in this paper and the various works referenced in it. Enjoy.
Concerning the "67% of software startups backed by venture capital" that held software patents - the question is why? Did they seek it on their own? Or only b/c the VC's told them that was the only way they'd get the VC money? I would gander a guess that most likely they only sought the patents to get the money - which goes to say, are the patents really worth anything to start with? Given its a startup there is nothing validated by the courts, so it at best a dubious asset for the VC's in an industry where, as the paper says, software patents are of unproven value to the industry.

It'd be one thing for VCs to insist on it if the start-up was making micro-processors and patenting some manufacturing technique - that's a proven method of securing the technology - but it's another in a fledgling industry where patents have yet to be proven to be of any use or value in helping the industry.

[ Reply to This | # ]

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