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Too much R&D, not enough R - Nathan Myhrvold Will Not Apologize for Patent Trolling | 119 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Too much R&D, not enough R - Nathan Myhrvold Will Not Apologize for Patent Trolling
Authored by: gdeinsta on Monday, June 18 2012 @ 10:27 PM EDT
For private industry...a lack of first mover advantage is problematic...creating a new product and having it copied within a few years is a strongly revenue-negative proposition. So, companies will be better off sitting on their hands and spending their development dollars copying each other. (Even with patents, most developing economies spent a few decades just duplicating products from the US. And, even with patents, there are large companies that specialize in being second movers and duplicating innovative products.)

This is not true of industries that operate in a modern way. Over the last 40 years time-to-market and NRE (non-recurring engineering cost) have been greatly reduced in every market except pharmaceuticals and chemicals. Even in rocketry, SpaceX has greatly reduced time-to-market and NRE. It is normal now to carry out continuous product improvement so you present a moving target to your competitors. As a result the natural economic advantage of being first mover, that is getting to market first, is sufficient. You don't need to augment it with an additional artificial monopoly.

It isn't so much that basic research can be or is supported by industry. (Bell Labs was an exception.) However, without patents, it would be difficult to justify applied research - which industry does do. (For example, no one would ever invest 5-10B in clinical trials to get 1 new drug without getting a monopoly on its use.*)

Pharmaceuticals and chemicals are the big exception. But to what extent have they failed to reduced time-to-market and NRE just because, without competition, they didn't have to? Consider pharmaceuticals, which are not only protected by patents but also protected from imports by national "safety" regulations. This is not a natural or in any way free market.

One thing that's actually sort of nice about patents is that they scale well with development cost/need. (With a monopoly, anything where the value is > development cost will be developed. Bounty systems, current industry revenues, et cetera scale less well.)

Patents do not scale down at all. You have to have multi-millions just to enforce a patent. Consequently they are useless as an asset to small businesses and lone inventors, which should have the most use for them because they are typically the most innovative. Meanwhile they are very dangerous as a minefield. You are looking at patents with a large-business mentality, but as constructed the patent system only throws obstacles in the way of innovation by small business.

[ Reply to This | Parent | # ]

Pooling
Authored by: Anonymous on Tuesday, June 19 2012 @ 01:40 AM EDT
Why can't industry players pool their research or smart
people/universities/governments set up research centers or knowledge
hubs/exchanges to provide solutions to specific problems?

It can't be more expensive than the current suit-counter-suit patent regime and
has the added bonus of being cooperative and creative rather than exclusionary
and destructive.

It will of course mean a goodbye to the current crop of CEO's steeped in
oldThink. Good riddance!

[ Reply to This | Parent | # ]

  • Pooling - Authored by: Anonymous on Tuesday, June 19 2012 @ 04:30 AM EDT
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