The first step in dealing with these issues, is to have a serious discussion about the term "intellectual property", and whether or not an idea can indeed be "property".
I think a very large part of the problem, is that our society has somehow come to the conclusion that yes, they can be. I strongly disagree. I think a better way to look at IP, is as an "intellectual lease".
When you have an idea, as the person or group who originally conceived of it, you are presumably in the best position to make use of it. You can therefore "lease" from society, the right to use it exclusively for a short, well defined period of time. At the end of that term, your lease expires.
At no point do you "own" the idea, because as soon as you release it into the world, it is already in the minds of many, some of which may be able to put it to better use than you, or to improve it faster than you.
This has several ramifications, including ones that effect creative works too. I posted a few long comments recently about copyright that expresses my view, but to summarise - creative works should have a limited window during which the author or creator can be the exclusive seller of the work (eg copyright should be about restricting who can profit, rather than who can copy). After that time, anybody is free to sell as well. This has many benefits. I used Harry Potter as the example last time as it is well know. Harry Potter now is known by almost everybody. We all know the story, we know the characters. JK has made a ton of money - more money imo, than any one author deserves, but that aside. HP is part of our collective humans story now. If I want to make a mobile game about it, or write a play about it, or adapt it for a new medium, or translate it - why should I still owe the original author royalties when I could reproduce the plot from memory? Again, I use the example of ancient Greece, and the way in which aural story telling was paranount. Stories spread, adapted, becamr part of society. The ones that survived that we have written down are simply one version that would have been told aurally at one point in time. The way that we insist that works and derivative works be set in stone in order to maintain profit is prioritising profit over the joy that is the spreading and adapting of stories that has been central to most human cultures since the beginning.
> At no point do you "own" the idea, because as soon as you release it into the world, it is already in the minds of many, some of which may be able to put it to better use than you, or to improve it faster than you.
When it comes to patents, even if you don't share the idea, others will come up with it independently. And the patent system is perfectly fine if you patent something then sit on the idea for 20 years and never allow it or any derived products be made or used.
All reasonable points. But except in an ideal world, I don't see how people who shape and enforce the laws are incentivized to realize them. That intellectual property is "out of control" is perhaps but part of a bigger picture that the government is dysfunctional and out-of-control.
You can talk about how things should be until the cows come home, but at the end of the day, the big question is how do you realize your ideas in the world.
The patent system has long been touted to help the little man, but today it's used by people who have legal fee money to bully everyone else. But why or how would this change given the political structure in the states or anywhere for that matter.
This is a byproduct of centralizing vertical power which is the very nature of most modern governments and their respective cultures. A distributed horizontally cut set of powers would be better and I think with the states, states rights argument support this.
> Without the right to exclusively profit from the final product, are pharmaceutical companies gonna invest all the resources and engage in all the bureaucracy-navigation it takes to develop a new drug?
Per recent congressional testimony, virtually all drugs are developed with NIH (federal) funding. So the first order of business in fixing this problem is dispelling the notion that there is such a thing as a "market" for pharmaceuticals. There is not. Government money is present quite literally from the very first step.
Coincidentally, dispelling false notions of the existence of "free markets" is the first step to solving a lot of other economic problems as well.
Virtually all drugs come out of an NIH-funded lab, but so do a huge number of other drugs and therapies that don't work. The vast majority of things that come out of research labs have no hope at making it past a phase 1 trial.
The drug companies do a lot of R&D to validate the ideas of drug discovery teams and to test for side effects. They spend incredible amounts of money on this, much more than the labs that initially proposed the drug.
> Virtually all drugs come out of an NIH-funded lab, but so do a huge number of other drugs and therapies that don't work. The vast majority of things that come out of research labs have no hope at making it past a phase 1 trial.
None of this has anything to do with the fact that the government is footing this bill.
> The drug companies do a lot of R&D to validate the ideas of drug discovery teams and to test for side effects. They spend incredible amounts of money on this, much more than the labs that initially proposed the drug.
Yeah, they do a lot of that... with taxpayer money.
But that work isn’t only magically able to be done by corporations. If pharmaceutical corps like Gilead and others didn’t rake in billions per year and were taxed properly (i.e. no more rentier incomes), that same work could be done in the open by NIH and others. Why are people so keen on state granted monopolies (patents) when it can be done open source?
No, copyright restricts copying and derivative works without royalties. As I said in my comment, I propose the restriction only be on profiting from work, and for a much shorter period of time than currently (70 years for creative works? Absurd. 10 years is far more appropriate).
I would actually go even further and say that the only restriction we should eventually need is crediting the original author. Potential individual profit (as in economic profit) makes sense in the current world where the distribution of resources is terrible and you want to be able to capitalize on your ideas. But ideally, if that's not an issue in the future, all you could reasonably want is "acknowledgement for your contributions". Even there the line is hard to draw, but I find myself more and more aligned with this perspective lately. Might still be too egocentric, though, and maybe not even "acknowledgement" is necessary. Maybe if acknowledgement was culturally more widespread even a law like this wouldn't make sense to me.
I mean, I said "ideally", and I didn't talk about money disappearing, only about, as you expressed, "money [not] being a problem". Which you might still consider naive, fair enough, but that's another story. And honestly, even if in practice it makes no immediate difference, telling apart the "moral" issues and the practical ones is relevant for analysis and defining the direction we want to move towards.
Free copies, even if you restrict profiting on the copies, implies the value effectively goes to zero. Most things can be digitally copied for free (art, books, software...). It is already a problem even with the restrictions.
Derivative works without royalties implies you would get countless copy-pasted works with the minimum amount of changes done to claim they are derivative. It already happens nowadays with things that try to claim they are not derivative works but completely new things when it is clear they are not.
Both these things are already super expensive to keep track and defend for small companies. If anything, what should be done is make them cheaper.
The 70 years is the only thing I agree. 10 is quite short. 20 would be fair and way better than the 70.
I'm sure many people are going to disagree with this, but authors should only receive income if people think their work is valuable enough to be rewarded for it. There will always be selfish people that would rather just download a copy rather than support an author. But I don't think simply writing a book entitles you to income. It was your choice to write it, nobody paid you to (if they did, then you are already paid for the work). If you choose to write a book, and nobody wants to pay you for it, then how good actually is it?
I have perhaps a different view of the arts to some people. I see them as good, noble pursuits in and of themselves. They should be done for their own sake. Art and literature was in my opinion, at its highest point, when the motivation for profit was secondary to the motivation for expression and exploration. As such, I see no reason for we as a society to restrict what people can and can't do with the stories, artistic works, and cultural works of our society. They best serve the interests of a society when they are free to spread, free to be shared, and free to be adapted.
I don't believe in artificial scarcity. If the only way for me to get access to a book is to pay a publisher for it, then it's worth has been artificially increased. I value the experience of going to the theatre, so I will still buy a ticket even if I can pirate the film a couple months later. I value seeing a musical artist perform live, so I will pay for a concert even if I can download their album for free. I value possessing hard copies of good works, so I will pay for them to support the author even if I can download the PDF for free. This is how you separate the truly valued works, from the works that have been artificially given a monetary value for the sake of profit raising.
And I hate to say it, but our social media frenzied society has inflated everybody's self worth. Just because you can publish an ebook in 3 clicks, doesn't mean it is good literature, and doesn't mean it is worth paying for. Copyright law which makes bad literature valuable is a bad law. Good literature will always be good, regardless of any laws that exist to protect it from distribution.
> But I don't think simply writing a book entitles you to income.
Writing a copyrighted book today does not entitle you to income either.
Do you really think artists make money just because they publish something?
> I see them as good, noble pursuits in and of themselves. They should be done for their own sake.
Agreed, but unless you are rich or someone supports you, that simply does not work.
I suggest you take a look at universal income instead. One of its advantages is that people could work on non-profitable endeavors if they are fine with a very basic life.
That, or wait until Star Trek becomes a reality :-)
> I value seeing a musical artist perform live, so I will pay for a concert even if I can download their album for free.
How do you do that for books and software which do not have any equivalent to a concert or performance?
> This is how you separate the truly valued works, from the works that have been artificially given a monetary value for the sake of profit raising.
Giving a concert does not mean your work is valuable. Neither publishing it digitally. And neither guarantee any audience whatsoever, much less profit...
> Just because you can publish an ebook in 3 clicks, doesn't mean it is good literature, and doesn't mean it is worth paying for.
This seems to follow from the "copyright entitles you to income", but since that isn't true, this does not follow either.
Someone publishing a bad ebook (actually, not even a bad one, average ones and even many good ones too) is not going to get any sales. Ask any aspiring average author or artist. They will have countless stories of how their endeavors have not paid any bills yet.
> Ask any aspiring average author or artist. They will have countless stories of how their endeavors have not paid any bills yet.
How doesn't this support my argument of reforming copyright laws? If even the (imo flawed) intent of copyright laws isn't doing what it's supposed to do (an economic incentive for creation of work) then what is the harm in reform?
You're right that holding copyright doesn't magically generate sales. People have to value the work in the first place. But I don't see how copyright laws as they exist now, make the work any more valuable.
When I talk about value, I am not talking about something in a supply-demand sense. I am talking about a work being genuinely quality so that it earns some kind of reward for its merit.
For example, I don't see buying a book the same as buying a ticket for entry. I see it as supporting an author. Let me use an example:
I might buy a ticket to a museum, not knowing what artwork is inside. It could all be atrocious, or maybe just not to my taste. Regardless, it could be work I would never buy. Now, the sale of the ticket as been a "fee to see". I made no choice over whether I wanted to support the artists. I believe that copyright laws as they exist now, place books in a kind of imaginary museum. An author isn't deserving of income simply because they produced something. Nobody asked them to. If they were paid by a publisher to, then great. If not, then what makes them entitled to income? The mere act of putting pen to paper? Anybody can do that. If I want to support them I will do so based on merit. And I can only assess merit of I can read what they have written.
> How doesn't this support my argument of reforming copyright laws? If even the (imo flawed) intent of copyright laws isn't doing what it's supposed to do (an economic incentive for creation of work) then what is the harm in reform?
It doesn't because your suggested reform would only make it (even) worse...
It'd imply only rich people could be full-time artists/authors. That is how it used to be centuries ago, by the way.
I know a lot of folks who don't love that they have to choose between charging for their work and starving. You seem to suggest that the first of those options should be foreclosed and replaced with "beg for patronage".
Which is pretty cool, because all else equal, that forces people to keep creating, lest they lose for lack of output whatever patronage they've managed to obtain.
Like, it's fine to say ars gratia artis, but you need to come up with a way for that actually to happen. What you've described here is much more ars gratia affluentium. What ends up getting made is, and is only, what people want to pay for, which at best is no improvement over the status quo, and probably isn't even as good as that.
I fail to see how copyright law as it exists now, removes the need to "beg for patronage". If anything, being able to freely access an authors work may generate more interest for lesser known authors.
I think, as with many industries, there is an unfair wealth divide amongst creative professionals. I don't think JK Rowling is such a better writer than most other writers alive today, that she deserves to have made billions of dollars for her work. The only reason she has made that much is because of copyright law. If anything, copyright law increases the divide between the lucky authors, and the much more talented but much more unlucky ones.
I tend to think the eight-movie deal had something to do with the money. Would it have failed to happen without copyright law? Your analysis should account for that, and it doesn't.
It also doesn't account for how, when there's no option to do anything but give it away, the people who succeed aren't those doing the best work, but those doing the best marketing. What's to stop them from simply finding good work by "talented but unlucky" people, representing it as their own, and getting rich on the back of it?
> The 70 years is the only thing I agree. 10 is quite short. 20 would be fair and way better than the 70.
Why is 10 years too short? Why is 20 better? What kind of profit does a huge book publishing company or a software corporation still need to extract after first 10 years of earning the revenue that needs to be protected?
Remember, most of profits from copyright don't go to starving artists, but to huge media and software conglomerates which then use this money to pay lawyers and lobby for more copyright extensions.
Limiting it to "profiting" opens up a giant load of issues. Is an artist not profiting from their art, do they not pay the rent with it, increase their reputation? Isn't a scientist profiting from their research, as results will also benefit their reputation and get them the next grant or tenure position / promotion?
If you're limiting it to "immediate profit", I guess Amazon could've used anything and everything because they never made a profit until 2001.
I very much agree regarding the years, though. And it's not even 70 years, it's 70 years after the creator's death.
Yeah great but when you put JK and HP stories as an example you trow out the window all those people whose works take decades to get popular. There is a lot more authors who struggle whole their life's. You should not change law based on exceptions.
Harry Potter would not have been written and published, and made into a global phenom without IP laws in the ballpark as they stand.
There is zero chance the Potter films would have been made were the Studios not able to protect their distribution.
There are other parties in the system, the content creators, who are pretty strongly affected by these rules - it's an equilibrium, you can get the same kind of output when you change the to empower one side.
Yeah, the argument that creative works wouldn't have been created without current IP laws is rubbish. Almost the entirely of the Western literature cannon was written before our current IP laws. Even in Dicken's time, he was able to profit without obscene copyright laws, because back then publishers would simply purchase the manuscript from him (which would be his income) and then they would print and sell them.
I find the notion that the number of times your book is read should be proportional to the income you make from it, to be entirely antithetical to the point of creativity and art. Doesn't matter whether your book is read by 1 person or by 1 million. You still put in the same amount of work. And, presumably, the higher quality the work, the more will read it. But not always. That's life. If a publisher thinks they can sell me or if you're an already famous and established author, publishers will buy your manuscripts for higher prices. If a publisher wants to enter into a royalties agreement then that is their own affair. We as a society should not be encouraging such arrangements - which is exactly what our copyright laws are designed to do.
"Yeah, the argument that creative works wouldn't have been created without current IP laws is rubbish. "
I didn't say that 'no works would have been created' - I said Harry Potter would not have - and certainly not the films.
I am not denying that some content will be created - but the anti IP people are sadly denying the very stark reality that most of it would not.
Harry Potter is definitely an example of a work that would not have been created, given the authors personal history during writing her works.
The sheer arrogance of those dismissing but the humane aspect of content creators not being able to make a living from the works, combined with the ignorance of the material reality of what this would mean for content creation and massive industries is missing from the argument.
"I find the notion that the number of times your book is read should be proportional to the income you make from it, to be entirely antithetical to the point of creativity and art."
Spoken by someone who has never actually created such work I can assume?
Have you ever actually made any 'art' or tried to do this full time?
Because your treatise speaks entirely and fully from the perspective of the consumer, who naturally, doesn't want to pay anything.
"I want everything for free because that's the way I feel about art" is not an argument.
I can comment and have opinions on the artistic and creative pursuits without actively pursuing all of them.
You cannot prove that HP would not have been written if profit protections didn't exist, unless you ask JK "if copyright didn't exist, would you still have written HP?".
My argument is that creative works will still be created because they always have been, and because people have created them before our laws existed.
You also assume that for-profit creators stopping their work is a bad thing. I am happy for people to be earning a living doing what they do. But I think the way we go about providing them with it is wrong.
The material reality is that artists were only successful if they were actually good. That shouldn't stop people from doing them - like I said elsewhere, I think artistic pursuits are good in themselves aside from profit.
But walk into any bookstore, go to the fiction section, and gaze on all the mediocre literature you can buy. I don't say that arrogantly. I couldn't write much of it. I am not putting myself above those authors. I am simply saying that the works themselves are mediocre, they won't be studied or remembered. They are simply entertainment. And I am happy for it to exist. But I can guarentee you that many of those authors were writing purely in the hopes that they'd "make it big". That maybe, just maybe, a movie company would see their book, and want to buy multi-million dollar film rights.
This, to me, is a perverse incentive for writing. And so I have no problem if less of it is published with the changing of laws.
Not everybody needs to go to university. Not everybody is a skilled enough actor to make it on Broadway. Not everybody is the next Michaelangelo. Pretending that the arts is a level playing field in terms of ability is a waste of time.
Talent is always rewarded eventually. The best artists don't need to say how good they are. The best authors don't need to say how good they are. In almost every case of copyright litigation, I saw mediocre creators quibbling over small profits that are "rightfully theirs". Just stop. Save your breath, and find a day job. Keep writing for the love it. Start a journal when you go home. Try and sell some of your work to a small publishing house for a small fee. And then be chuffed if enough people like it enough to copy it.
I just want to add to that under the current system very few artists are able to make a living off of it. Consider all the scripts that never get made into movies, the mountains of not-bestseller books, the musicians that have other jobs to pay the bills.
I know several people who wrote highly regarded technical books. Not one of them makes enough off of books to be a living. What the books do do for them is make their reputation and careers.
The artists that do make a living are doing artwork for web pages, advertising, packaging, etc.
The system as we know it needs to be overhauled. We need to scrap everything and then think carefully about what should be patentable with the goal being a system that’s good for society. Drugs that cost $1B to bring to market? Seems like they should get some kind of exclusive period though we can argue over what that period of time should be. Software? Nope. Keep copyright law for that, but even there, drastically reduce the copyright period.
I think both patents and cooyright should be taxed so that the time progressivity is high. Say first year or two practically free, but if you want to keep your ip at 20 years, it should cost you billions. You can stop paying tax any time you want and your ip moves automatically to public domain. Solves also orphan works. (Yes, I know, Berne convention needs likely to be amended for this to be possible)
or treat intellectual property the same as physical property - pay a property tax. The value of the IP is the amount of transfers and licensing it has - so you cannot hide profit by "selling" IP from a foreign offshore tax haven.
I think the value of most IP is to abstract to apply a tax to it. Some patents are extremely valuable, most are worthless. Some are only useful to Patent Trolls, or for defensive purposes, etc.
How would you tax a company that patents something it develops and sells itself? If the products/service they sell involves lots of non-patented features and/or multiple patented features, how do you determine the value of any individual patent?
How do you determine the value of patents effectively licensed through an Agreement Not-to-Sue?
You raise a good point. The way how real estate is valued is through a market where each item is looked at individually more or less, but patents are connected.
A possible solution could involve letting the patent owner itself state how valuable owning the patent is to them. They could declare a monetary number X and then do annual payments of say 0.1% of that number. They could adjust the number monthly by statement to the patent office, but would have to pay the tax on the maximum number they told to the patent office within each year. Now comes the core of the idea: the number would be public, and any entity could "free" the patent by paying that amount X to the patent office which then redirects it to the patent's owners after deducting a tax. The patent would then enter the public domain.
So company A invents something, patents it, and claims a billion dollars of value to the patent office. They have to pay a million in taxes annually. Company B thinks it could make a lot more than a billion dollars if the patent got lifted, and pays 1 billion to get rid of the patent. Company A is now 1 billion richer (minus patent freedom taxes), but now has to deal with competitors. So their next patent will have 10 billion as value number.
I'm not sure the idea is good or not, it has some problems, e.g. it might lead to patents becoming even larger than they are today so that they get lots of valuable stuff into the patent's umbrella. Patent offices might become more willing to grant patents for things as they are now a major revenue source for the government, and many patents on promising stuff will need big investors so that they can afford the taxes until the patent matures. Also companies won't be able to plan as well as they are now. Making the tax progressive will help with some of these problems, but maybe not enough and maybe not with all of them.
This is an interesting idea. It reminds me of the idea of "I’ll break the cookie in two; you choose your piece." I’d have to work through the implications of how this would play out between large corporations, but the most immediate issue I would see with it is for the smallest inventors/companies.
In many industries, a new/small company would never be able to price it’s patents out of the reach of its largest competitors, it would put them in the position of either spending huge amounts of their working capital in taxes to defend their patents, or let the patents be sold and compete with their large competitors on production, logistic, and support costs (which is a loosing position for a new small/new company).
It would be even worse in the case of a solo inventor. Imagine you come up with an idea so good it’s clearly worth a billion dollars, but only in an industry with a single, or small number, of big players. If that one big player, or several big players collectively, refuse to buy or license your patent, you won’t be able to afford the taxes and end up with nothing once it expires (and they are free to use it). If you want to try to develop it yourself, you now need to find a huge amount of additional investment just to cover the taxes.
If the invention is clearly worth billions (that is, either it is capable of generating billions in value, or save costs of billions in value), then why wouldn't the big players license it?
If these big players openly collude (via contractual agreements for example), then it sounds illegal (or should be).
If these players aren't colluding per se, but "individually" decide to not purchase a license, then the first player that buys the license gets a head-start in their savings/rewards from using the patent.
>How would you tax a company that patents something it develops and sells itself?
That's easy. Have a flat fee per patent that increases based on years plus number of patents the company holds up to crazy amounts. What this does is three fold: 1) Tax patents the same way physical possessions are taxed. 2) Limit big corporations that have the budget to realize tons of patents quickly so patents are again used for the benefit of the small players. 3) Prevent patent trolls from holding big portfolios of bad patents as the costs would be extremely hard for them to maintain.
You can charge a flat fee per patent. By this you avoid having to assess their value.
For normal ip it would likely need to get registered in order to receive copyright protection.
This way creators only pay taxes for their larger works. The biggest problem with this is that this tilts the playing field against smaller creators.
This would seem to be very biased in the favor of large corporations. If the fees/taxes are high enough to be non-trivial for a mega-corp, then it's very likely those large and increasing rates would easily outpace the rate at which a small company could develop their product, get it to market, and start making a profit. It would also mean larger corporations would have little incentive to purchase patents from smaller entities, when they could just wait our their ability to pay for them.
I think that would still be a boon for society. Take Slack as a random example. They took an incredibly simple idea (chat, but seriously) and took it to market with great success. Everyone including the largest corps had been doing chat, yet Slack did it once more and nailed it.
I think if everyone could freely build upon ideas, corporations wouldn't suddenly be making all of these amazing products that thwart every little player out there. Or rather, any more than they already do. And then we'd all be reaping the benefits of collective knowledge.
I think you may be limiting your view to software here though. Software has an entirely different cost-of-entry then virtually any other industry, and most of the major products you see coming out of the industry right now are a combination, reimplementation, or reimagining of already existing ideas. Most patent issues in this space are issues with "business method" and "XYZ but on a computer" patents, the validity of which are both arguable, but a separate issue from the wider value of patents.
There are many other industries where advancement is not made without huge amounts of investment, and the only thing that protects the little players are patents. An industry like Chemical Engineering and Manufacture for example – the development of a new useful chemical compound may cost 10s of millions of dollars in research, testing, process improvements, etc. Why would any company bear that cost if they could just wait for another company to do it and start producing it themselves, undercutting the cost of the original developers who must price their offering higher to recuperate their R&D cost? What would stop any large manufacture from taking a novel new compound developed by a smaller competitor, or recent entrant, and using their large already existing production and logistics capacity to undercut their small competitor?
Also, regarding collective knowledge -- remember that the only alternative to patent protection is to keep something a trade secret. That encourages a company to never publicly disclose anything about their process that they can keep secret, which can theoretically be done forever, and can mean that when the company eventually ceases to exist, that knowledge can be lost.
I’m not saying that the patent system doesn’t have its flaws, and really needs some revisions and updates in places, but it does provide a real value.
The fact that the 3D printing community, and even some of the companies that currently operate in that niece, share more openly with each other is great. But should 3D printing ever get wide-scale traction (think home appliance), then that free sharing of information means any random mega-corporation looking for a new profit-center can step in, take all that knowledge, and simple stomp out all the small players who invested time and energy into their products. The same goes for any product developed as open-hardware, if it gets wide-scale traction, any mega-corp can trivially reimplement it and remove the smaller players from the board. Neither group has any protections without patents and copyrights.
I would also argue that those two areas have a relatively low-cost of entry like software development, but only have such due to the huge amount of investment previously put into those fields, and existing industries around them. High-power and low-cost microchips, high efficiency stepper motors, etc, were developed due to decades of constant industry investment, and the open-hardware community isn’t going to be mass producing stepper-motors, microprocessors, or FPGAs anytime soon.
To be clear, these are both communities I think are great, and consider myself part of, but you can’t ignore the reality of the industrial and business world around them because it’s inconvenient. In an ideal world, everything would work like those communities, but our world is far, far, from ideal.
As for case examples for my arguments. For small player protection -- just look at how lack of patent enforcement causes so many small companies to fail due to lower-cost knockoffs produced in china being released before their brand gains traction. For the need for a return on investment -- that’s just how industry at large works. No company will invest significant funds developing something if there isn’t a reasonable chance of making a return on that investment. If all your competitors can immediately copy and undercut you, the ROI drops to zero. I can actually provide some specific examples from the company I work for / industry I work in, but I'd prefer to move the conversation offline if you'd like to discuses that.
3D printing was sat at an impasse for two decades because several companies independently came up with related processes for it, then fought a massive patent war, and each of them walked away with exclusivity to one particular process (EOS with sintering, Statasys with FDM and 3D Systems with SLA). For two decades progress just didn't happen because the patents prevented it. There was a world market of about 5000 3D printers. The market was saturated entirely.
As soon as the patents started expiring, it took less than a decade for the market size to grow by four orders of magnitude, part quality improved by an order of magnitude, part cost and machine cost dropped by three orders of magnitude. Everyone, including the fuckers that kept the market locked up, are benefiting massively from this. The innovations that enabled the dramatic development of the field over the past decade were primarily driven by a loose community of individual contributors and companies of all sizes, and there seems to be enough of a market for all those entities to exist simultaneously. You have mega-corps trivially reimplementing open innovation, and then failing commercially because everyone hates them and doesn't trust them enough to work with them. Patents are actively harmful to this industry.
As for open hardware producing capital investment intensive products, just have a look at what's happening in the RISC-V community. You can ensure return on investment by collaboration from the start - investing in an ecosystem rather than a particular product. It's much easier for smaller players to survive as part of an interwoven ecosystem than on their own with litigation as their only weapon. If the only way to get people to work with you is to threaten to sue them, you're going to be destroyed as soon as someone comes along with a bigger gun. The very concept of "protecting your investment" and treating everyone else as a competitor and a threat is a mindset that ends up self-fulfilling.
I would argue that many more companies get killed by hostile patent enforcement than by lack of patent enforcement.
Again, you're still limiting your perspective to some very specific, niche, and frankly unusual industries, and looking at them in isolation. Most industries don’t and can’t have a "loose community of individual contributors and companies of all sizes." The 3D printing industry is unusual in that it has a very low cost of entry, and many of the primary consumers have the skills to directly contribute to the further development of the technology, and an intellectual interest in doing so.
You’re also still ignoring that 3D printing and Open Hardware would not exist without the trillions of dollars in capital investment made in all the underlying technologies. Investments that would have been an insanely risky propositions without IP protections.
Can you explain how the multi-billion/trillion-dollar research and development in jet engine design, commercial refrigeration, medical devices, drugs, microcircuit manufacturing, industrial mechatronics, etc, can be accomplished by the private sector, without legal protection to allow for a ROI? Can you find an example of someone developing Open Hardware who is making large enough profits to build their own semiconductor R&D labs and foundries?
And again, I’m not saying that there aren’t a lot of problems with patents. I fully agree there are. As you said, “hostile patent enforcement” (meaning forcing a company to defend itself against vague and often entirely invalid patents), is a serious problem. But that’s an argument for patent reform, not abolishment. Unless you can come up with an alternative way to protect the huge-to-astronomical R&D investments many industries require.
Also, to be blunt, thinking that “mega-corps trivially reimplementing open innovation, and then failing commercially because everyone hates them and doesn't trust them enough to work with them” applies to anything outside tiny niche and industry-internal markets is frankly silly. The general public will buy the next shiny new toy from whichever mega-corp has the best marketing. Serious industrial operations always prefer to buy from bigger companies as it reduces various sources of complexity and risk (this is an area I know firsthand and can go into detail on). It’s very rare that anyone cares who originally invented the technology. And regarding your last point -- without patent enforcement, no small company developing a functionally better technology would even exist to be attacked. Nobody would invest in starting a company if there was no way to stop the incumbent from reverse-engineering the improved tech before the start-up gained any market traction, adding it to their products, and crushing competition through price, marketing, and existing consumer network (again something I can talk about firsthand if you'd like to continue this off HN).
The 3D printing industry is a side effect of existing stuff developed for entirely unrelated purposes. There's nothing exciting there technically. The only reason it didn't go mainstream decades ago is patents. There was never any heavy capital investment in the underlying technologies - it's just yet another application of motion control, material handling, and CNC technology, which was never developed specifically for that, but taken into use after it was already widely adopted in other industries. Claiming it would never have existed without heavy capital investment is true, but misleading. It's like saying flexible PCBs and space blankets would never have existed without the moon landing. It's true, but now that the technology exists it's possible to use it without starting your own space program. There's plenty of money to be made and new stuff to be developed by standing on the shoulders of out-of-patent giants. 3D printing has a low cost of entry now - it didn't before. The cost of entry advantage came due to community/ecosystem based development, after the patents expired. Prior to that, it was much more expensive. This can definitely be replicated to other industries (and we're seeing it right now with computer peripherals for example).
There's an enormous number of industries with an ecosystem of specialized suppliers, some of which are tiny. The automotive industry is a prime example, where the big brands rely on thousands of tiny specialized vendors, many with single digit number of employees, for parts. The electronics industry is even more extremely so, with thousands of fabless semiconductor outfits with double digit employees, hundreds of packaging and testing companies serving those, thousands of distribution, assembly, and logistics companies on top of those, many one person or one family operations. The big foundries are what everyone knows, but none of them would exist without this. And the industry giants don't rely on patents because patents are not really safe to rely on - they mostly use trade secrets - both in the automotive and the electronics industries. You also see trade secrets as the core investment protection mechanism in aerospace, heavy industry (metallurgy, polymers, large-scale manufacturing processes) and related areas. Almost all heavily centralized industries except pharma/biotech rely on trade secrets rather than patents.
Industry-internal markets are where the bulk of the market for technology is. And reputation is critically important there. You definitely see large companies attempt to break into these ecosystem based markets and fail commercially because they don't give a shit about their customers, and smaller outfits do. And there's certainly aversion to dealing with litigation-trigger-happy outfits. I see a whole lot of migration away from products after Oracle acquisitions for example.
And fuck the idea that no innovative companies would exist without patents. There's endless companies that don't have patents, and exist, and take investment. And there's countless instances of companies that do have patents being attacked by megacorps who want to take their stuff, and of course the megacorp almost always gets away with it because they have the bigger guns, and can spend years in litigation until the victim folds and they can buy their assets at pennies to the dollar. Patents have never been adequate protection for a small company. They mostly exist to justify investment, rather than to reduce risk.
I don't see a way to reform patents that makes them a net gain to humanity. I see them doing a whole lot of damage now. I don't see a moral justification for this to go on.
Much of the cost of that drug being brought to market has far less to do with innovation and much more to do with regulatory approval and clinical trials.
A solution to address that might be in the form of designed profits, where the exclusivity period is determined by the profits generated. However I'd also still like to see second and more sources, so a compulsory license during this period is also desirable, but might focus on a fixed percentage of profits. (Also contributing to paying down the public liberation fee of the work.)
We need a system where a patent can be challenged in the initial period when someone applies for a patent.
For example, someone wants to patent "one click shopping". The USPTO publishes the "objective" section of the patent application. Then, during the challenge-period, someone else reads the application, implements a one-click shopping button, sends the solution to the USPTO and the patent is denied. Optionally, the person who found the solution (either by implementation or by finding prior art) is then compensated for their work by the original applicant.
The system could be extended by allowing the patent applicant to specify the expiration date for the patent, but a longer expiration time will also mean that the challenge-period will be longer and the cost for a rebuttal will be higher.
Re drug development: Why should they get an exception? This is how we create a flawed system. There are lots of things in the markets with high entry costs that's part of the challenge to bringing a product to market.
You still get a huge market share/reputation and likely can keep that by being the first to market which is enough reward imo to a product to market.
If the public did subsidize any ip then that ip should be disimenated after the subsidy period to the public.
> Re drug development: Why should they get an exception?
Because we've decided that drugs need to be safe and effective to get approval. And the process for proving that a drug is safe and effective is extremely expensive. If you don't reward companies that do the R&D, there just won't be incentives for private industry to develop drugs. If company A spends $1 billion dollars to develop a new compound and then run clinical trials to prove it's safety, and then company B comes along and manufacturers the same drug but says "it's already been tested on patients by company B, so we shouldn't have to bear any of that cost again, but just the cost of manufacturing the drug itself which is trivial" then you'll have a lot of company Bs but no company As.
That said, maybe patents aren't the right mechanism for this. Maybe just extend the term on existing exclusivity to something similar to the term that patents cover.
> You still get a huge market share/reputation and likely can keep that by being the first to market which is enough reward imo to a product to market.
The data doesn't bear this out. When drugs go generic, the brand drugs' market share overwhelmingly drops in favor of people who buy the generic (insurance companies usually force you to by not paying for the brand). There are exceptions for certain types of drugs.
I think the thing that is unique about drugs is that they are incredibly expensive to develop and bring to market, but trivially cheap to reproduce. I just happened to watch this video  a few days ago, where the host gets, as a free sample, enough of a chemical to make $3 million at retail prices worth of a cancer drug.
That doesn't seem to be true of anything else covered by patents. Software is cheap to develop, and other kinds of engineered products (cars, hardware, etc.) usually aren't that much cheaper to reproduce than they are to develop.
I think patents should simply be far more expensive. For a drug (or a chip manufacturer or whatever), even a very expensive patent would be negligible relative to the R&D costs. However, it would make a lot of bullshit patents not worth getting.
Patents are already expensive enough to stifle innovation and even more expensive to enforce. This is already happening when they aren't artificially raised because of inherent costs in our legal system.
I think modern drug manufacturing is a lot more nuanced then oh I can copy this chemical. And if it is then that's life of a drug manufacturer, you build that into the price. Like everybody else, I think it's a false political narrative that drugs are magically nuanced in ways other things aren't.
There should be a compulsory license fee, and the total fees for any given device should be capped as well.
It would actually be nice if there were a couple different schedules for such fees, and if one of those was based on the final sale cost. That would make "IP" a non-issue for no-charge free (as in beer, but also liberty) software.
Your second suggestion would be extremely exploitable, because you'd be allowing the licensee unilateral control over the price. Your competitor just came out with a cool new widget that's going to keep them in the black for years? Copy it, shove it on the market at near-zero price, and enjoy your uncontested market.
Could you provide a hypothetical example of where this might exist?
I'm having trouble envisioning how selling some form of hardware at an extreme markup is necessary if the compulsory license fee for being able to copy it is a PORTION of the sale (and not profit) price?
That would ideally mean that someone else has decided to bring the product to market for more people, and that the actual inventors get rewarded for enriching society faster and more greatly in total.
Along the lines of hakfoo's response below, this would naturally happen any time you're dealing with enhancements to a larger ecosystem (i.e. complementary goods) - the sale price of certain products can be profitably set to almost zero if they encourage buying more expensive, or at least higher-margin, things. A specific example: patentable improvements to consumer-grade inkjet printers might be disincentivized under this scheme, because the real money is in selling ink to locked-in buyers.
I think there are some more fundamental problems with using sale price as the base of computation. What's "final" sale? Is it the price my company sells for wholesale? If I own my own vertically-integrated distribution network and sell direct to consumers, do I now owe the patent holder more per item? Am I incentivized to put my retail stores behind a shell company to bake the "final" sale price earlier in the pipeline? On that note, what's to stop me from doing so recursively? I could set up a "manufacturer" entity that produces the patented widget at a loss, paying the minimum licensing fee, and then an "assembler" entity that packages it into a meaningful product and actually makes all the profit. I suppose to some extent this is the same problem as deciding when to impose sales tax, so maybe the same regulation works there, but it feels trickier.
That's also setting aside what I expect are deal-breaking practical problems having to do with components. Most actual products are not patented in their entirety. If you use a patented design that improves one component of a $400 machine, is the license fee based on a fraction of $400? Do I owe the patent holder more per unit if I assemble my product with a high-quality aluminum shell instead of a cheap plastic one? If I have to use 5 different patent ideas to make that machine, do I pay all 5 owners the same fraction? If not, then who decides the respective fee for each one? (As an example, a modern smartphone probably makes use of hundreds of patents - think about how many patented bits of circuitry there are just in the radio and modem.)
Re: 5 different IPs. That's already covered for the COMPULSORY LICENSE, which would have the terms that society agrees are the absolute maximum that could be charged.
Lets say this is 25% of the sale price. That is, society says that at most 25% of the sale, not profit, price is allowed to cover IP costs. In your fictional example of 5 different involved patents the legal framework incentivizes the 5 patent holders and those who desire their patents to negotiate a split.
Re the other question: no patent fees in sub-assemblies aren't counted, those things were already on the market as whole units. However a large corporation that is integrated across manufacturing many things (which presumably also has other market distortions like a huge IP portfolio anyway) would be able to count it, if they were also making those sub components. Yes that seems unfair to me, but it's a reflection of a different broken system and should be addressed there.
>Lets say this is 25% of the sale price. That is, society says that at most 25% of the sale, not profit, price is allowed to cover IP costs. In your fictional example of 5 different involved patents the legal framework incentivizes the 5 patent holders and those who desire their patents to negotiate a split.
I'm not sure I'm following the story here. So we have compulsory licenses, which are to be set as no more than 25% of the licensee's sale price. Let's assume that the licensee accurately knows all of the patented ideas they plan to rely on. The prospective licensee needs to set aside 25 cents of every dollar to be paid to patent holders. So far, so good (although I don't think you'll be able to find a number that's satisfactory; see below). Now what do they actually do with those 25 cents? They can't unilaterally send it to any of the patent holders, because apportionment needs to happen. You can't require that they pre-negotiate a split among the patent holders, because that would defeat the point of a compulsory license by allowing one or more patent holders to drag out negotiations. You could set up a third-party entity (i.e. a government agency) whose job it is to hold all the payments in escrow and manage the negotiations among the patent holders, but that would require said entity to either bear the risks of dealing with bad-faith negotiators or be willing to make unilateral judgments based on the merits of an individual case - and given how well the USPTO does with bad-faith actors now, I don't think I trust them to take on an expanded role that would require dramatically more technical expertise and judgment.
re: 25% - I know you didn't mean to put any weight behind that particular number, but I also don't think there is any such number that would be universally reasonable. Again, I don't think many commercial products consist solely of the implementation of a single idea. Even if you're only basing your product on one patent, presumably you're also adding your own thought to make it marketable, and the amount that that new thought contributes is variable per product.
If you set the license fee ratio very high, then patent holders of small ideas can unduly enrich themselves by demanding most of the revenue for something to which they contributed only a small part. (That degenerates to the current situation - you can think of the current situation as having a "compulsory license" with a price that's often somewhere above 100% of sale price, since you can always proceed without a license, at the cost of a lawsuit that would recover the price plus punitive damages.) On the other hand, if you set it too low, then you open the door to blatant copying. And note that this isn't just a matter of picking something "in the middle" - no matter where you put the line, bad-faith actors will change their behavior to exploit it in one direction or another, or both.
Addressing the middle point (which you've labeled a fundamental problem)... I am not a patent lawyer (or even a lawyer generally).
However I believe the stopping point is exhaustion.
A license for X would be demanded when the first sale that uses X happens. If the IP is related to the formulation or formation of part of a capacitor then the payment for such is part of the price of that good and is not required or taken again at any other stage (other than in the price of the components already included in the BoM). Similarly, the price is reflected in the first transfer of the good, not in any final consumer sale of the unit.
>the price is reflected in the first transfer of the good, not in any final consumer sale of the unit.
Right, so this is trivially exploitable, as I described. Set up two entities. One of them makes the capacitor and "sells" them at cost, or lower, to the second one. The license fee will now be based on that deflated price. Arguably it's fraud, but proving that - and the extent to which it's out of the ordinary, since manufacturers do sell each other things at discounted bulk rates all the time - would be a nightmare.
Even if you close that loophole (e.g. with perfect fraud enforcement (ha)), you're incentivizing inefficiencies by punishing vertical integration. What if it's cheaper (less labor, less waste, less machinery, easier logistics, ...) to produce a whole circuit as one unit rather than building the capacitors first and then assembling? If the license price depends on the first transfer point, then the circuit manufacturer is better off wasting money and resources to isolate the patent-dependent components so that they can be transferred independently, with the licence fee coming out of that small price. Otherwise, they'd have to pay a fraction of the entire final product, which is presumably much greater.
Aren't there already anti-dumping regulations for similar goals?
I'd wonder if you'd see a lot of products sold "ready to assemble". The software is free, or some mandatory-license component costs pennies, but it's useless without the remaining bits to plug it into.
There's obviously a balance to be made with incentivizing inventing though. Some inventions are expensive and nobody would do them without patent protection. Some are trivial though and it's those that are a problem.
Perhaps whether you can get a patent should depend on how much time has passed from when the invention was possible (existence of necessary prior inventions/science/etc.) and when you invented it. If nobody else thought of it for 10 years, maybe it's worth a patent but if it's an immediate consequence of something else, then perhaps it's obvious and deserves no protection.
There's obviously a balance to be made with incentivizing inventing though. Some inventions are expensive and nobody would do them without patent protection. Some are trivial though and it's those that are a problem.
That is quite an assumption, especially in assuming that the only way for governments to incentivize the development of technology is to give someone exclusive monopolies on those inventions.
We could give them grants, reward money, whatever. There are other ways to incentivize invention without tramping on companies and inventors' abilities to build upon the work of each other.
Not to mention that the development of 3D printers take hardware, which is quite expensive.
You get market share and rep for bringing a product. People are naturally incentivized to innovate within their grasp.
At some point all new technology is so expensive it's beyond reach, until it's not.. When governments force these things out of time with artificial incentives for political reasons often the market grows around it with poor incentives. The cost of which is filled long term for the negative by the tax payer.
The US interstate is a good example. If the government had waited until it was cheaper and the private sector would have done it then cities wouldn't have developed with such sprawl issues because the citizens and private markets would have had the opportunity to have paid for those costs and they wouldn't have. Cities would instead have been more dense and later when cheaper more viable public transportation systems were developed they would have been a lot more effective and more widely deployed.
Furthermore this takes resources away from the natural market growth that would have otherwise gone toward the natural market direction.
I question that it's obvious that we need to incentivize inventing through any form of IP law.
Let's look at software. Some of the most notable pieces of software, from postgres, to linux, to redis, are available under open source copyright license. Those licenses are intentionally waiving copyright law.
Inventions of those pieces of software happened with no expectation of IP.
Let's look at academic research: research institutes and academic institutes are more interested in getting published, advancing the arts, and improving their own name in the field than they are with patents. A large chunk of ground-breaking research done in academia or research-labs is done with the primary goal of getting a paper published out of it, and whether there's a patent or not, it's not what motivated the research. Often, there is no patent.
In fact, I think the open source software movement is the most obvious example of what happens when you don't have IP. The whole point of open source licenses is to defang copyright law (to use copyright law against itself). In the case of the Apache2 license, it also gives up patent rights. Within the open source software movement, innovation and profit are both common. Both happen in spite of the lack of IP protection.
Why is that the case? Well, software developers who create great things and release it into the open source world often want to increase their talents, increase their recognition, or solve a problem they or others are facing. Those motivations all exist even without IP nor profit motives. Some of them do have a profit motive and create open source software in order to be hired or in order to sell support (or for some other more complex funding model). Those also don't need IP laws to help them.
I admit, software is interesting. It can be argued to be an art in many ways, and it's much easier to accept that artists will continue producing art, even without financial or IP benefits.
However, I think that it's likely other fields where this holds as well. I think that someone who has an idea to improve a part of a car will still wish to publish the idea to gain recognition, or negotiate with an auto company to try and implement the idea to gain both fortune and fame. I think the drug companies will still wish to produce and sell drugs, and their research employees will still attempt to find new and better drugs, even with the only motive being commercial profit, not IP + commercial profit.
I think software provides ample evidence that you can profit off something even when IP is not in play. That the original inventor has enough of a headstart.
Linux copies Unix (Bell labs), postgresql copied sql (IBM); redis is open core and is a bit of a different situation; newer examples are godot copying unity and blender copying other 3d programs. Each implementation is often better than the original, but they are not examples of novel inventions.
I forget the history of gcc but assume it was not the only c compiler? Anki is based on supermemo, etc.
Emacs was a novel invention, as was the concept of foss development.
I love foss but it’s often more about freedom and trust and community and improvement, more than about innovation.
It's difficult to get the general public to support taxes that will fund the repair of degrading bridges, leaking dams, and cracked roadways that may soon fail and actually KILL them. Do you honestly believe you’ll find widespread support for government funding of all major industry research?
Also, how does that investment get prioritized? What if the general public decides that some industry isn't worth investment, despite some people believing it is? Without patents, there is no way for the private sector to invest in R&D without just knowingly burning money.
I'm not saying government investment in research isn't a good idea. I think it is, and is something we should be doing more of, but it's not a replacement for patents.
Honestly, our general public really hasn't had any direct say in how our tax dollars are spent for most of America's history. Outside of really rare individual referendums, the public doesn't sit down and decide on individual taxes like bridge repair/etc. We're not a democracy; we're a republic.
If you look at polling, virtually everybody in our country would be in favor of repairing bridges/etc. Furthermore, both political parties in every major election for the past few decades have explicitly promised to enact massive funding for exactly this. Ergo - we're all voting in favor of major infrastructure funding - i.e. voting "yes, please, tax me and pay for bridge repair. Do it." The public will is absolutely behind this.
Our real problem is we're terrible judges of character - we elected people who just pocketed the money, instead.
Popular Mechanics has been popularizing science and technology and promoting inventions for over 100 years. For them to publish an article that comes down so firmly against the current intellectual property laws is significant. It's time for change.
Glenn Harlan Reynolds (born August 27, 1960) is Beauchamp Brogan Distinguished Professor of Law at the University of Tennessee College of Law, and is known for his American politics weblog, Instapundit.
When the group of people who are supposed to be protected by a law say it’s not helpful and the group that enacts the law says it’s for their own good, it says a lot about the law and who it is really benefiting.
Thanks, very interesting. I found their "what the public wants has no impact" hard to believe – well, they have about 4 differently-worded versions of that on that page – so I tried to read the first paper cited,
In which Figure 1 is the flat graph in the video, showing that about 30% of policies are adopted no matter what percentage of 'average citizens' favor them. For 'average citizen' (what on that webpage they call "the public" and "public opinion") they seem to consider only opinions of the median-income percentile (i.e. 1% of people):
> Policy preferences at the fiftieth income percentile — that is, the preferences of the median-income survey respondent—work quite well as measures of the preferences of the average citizen
Also it finds a correlation of 0.78 between the preferences of this percentile and that of "economic elites", yet a -0.1 negative correlation between economic elites and business interest groups, which is surprising.
This seems to me to contradict the "no impact" finding:
> Thus when popular majorities favor the status quo, opposing a given policy change, they are likely to get their way; but when a majority—even a very large majority—of the public favors change, it is not likely to get what it wants. In our 1,779 policy cases, narrow pro-change majorities of the public got the policy changes they wanted only about 30 percent of the time. More strikingly, even overwhelmingly large pro-change majorities, with 80 percent of the public favoring a policy change, got that change only about 43 percent of the time.
How is that "no impact"? Anywhow, it's an interesting study, I'd love to read what someone who knows statistics better than me thinks of it.
I read somewhere that neanderthals were not less intelligent than humans, but humans "won" because being more social animals they can better learn from each other and spread ideas faster. Sometimes I feel like excessive "intellectual property" laws make us more like neanderthals.