Startup Investors: "Patents are a cancer"

100-euro bills going down a drain

One oft-questioned objective of the Pirate Parties is the dismantlement of the patent system, as in scrapping the concept altogether. Patents are a remnant from the guild era that has never served to advance the rate of innovations, but always to brake it in favor of incumbent industries. It should have been killed when free enterprise laws were enacted worldwide in mid-1850s, but wasn’t.

The patent system delayed the Industrial Revolution by 30 years, broadcast radio by five to ten years, powered flight by 25 years… I could go on and on. And today, it’s no different. The situation certainly isn’t helped by clueless politicians who measure “innovation” as “number of filed patent applications”, which is about as useful as measuring “economic growth” as “number of smashed windows”. It’s not just unrelated, the correlation is strongly negative.

This is important: the patent system hasn’t derailed just recently. It was always a retardant on innovation. It’s just that the pace of ideas has picked up, and so this fact has become much more apparent — and much more damaging.

Engineers hate patents. Almost every engineer I’ve spoken to show the deepest burning sincere hatred for the patent system in their own field of work. At the very best, they haven’t questioned it and so are indifferent. Curiously, most engineers think that patents are necessary outside their own field of work, but in their own, they see how it is a major retardant of innovation. This goes for all engineers across all fields of work.

The justification that is constantly brought up across political panels when I criticize the patent system is that venture capital won’t flow into startups if they don’t have patents. Venture capitalists want it, I’m told, or they won’t invest in new startups, which is fueling our entire economy. It is true that startups and small businesses are the backbone of our economy. But I also know that venture capitalists and other kinds of business angels never consider patents to be the determining factor in investing.

Finally, via TechDirt, I learn that some very well-respected VCs are starting to say what they really think. And boy, are they telling it like it is. No punches are spared here.

“I can’t understand why our goverment allows this shit to go on. It’s wrong and its bad for society to have this cancer growing inside our economy.”

“The basic problem with patents is that you’re trying to assign property rights to something that doesn’t deserve property rights. […] The basic problem is that Chris [Dixon] and a bunch of engineers can be sitting at Hunch designing some amazing new feature and somebody unbeknownst to them has a patent on this feature and never actually implemented it and can now screw them over… It’s just not right, it shouldn’t exist.”

It’s great to have the people who supposedly matter politically on the topic coming clear in this very unambiguous language. Thank you, good sirs.

Nobody wants patents except patent lawyers and a few specific companies that can use patents to tax the public. Patents kill ideas, the growth of society, and our backbone businesses.

Rick Falkvinge

Rick is the founder of the first Pirate Party and a low-altitude motorcycle pilot. He works as Head of Privacy at the no-log VPN provider Private Internet Access; with his other 40 hours, he's developing an enterprise grade bitcoin wallet and HR system for activism.

Discussion

  1. Falkvinge: Startup Investors: “Patents are a cancer” http://bit.ly/ljmvSo

  2. Falkvinge: Startup Investors: “Patents are a cancer” http://bit.ly/ljmvSo

  3. Startup Investors: “Patents are a cancer” – http://t.co/OCl2s7X the pressure builds #intellectualmonopolies

  4. Startup Investors: “Patents are a cancer” http://bit.ly/ljmvSo

  5. Las patentes son un obstáculo para la innovación y un cáncer para la sociedad http://ow.ly/1tCJpi

  6. Falkvinge on Infopolicy: Startup Investors: “Patents are a cancer”:
    One oft-questioned objective of the P… http://tinyurl.com/3tjnvqr

  7. Particularly love the last paragraph. Sums it up, pretty much: http://bit.ly/jnCbrK #noswpatents

  8. ♻ @glynmoody Startup Investors: “Patents are a cancer” – http://bit.ly/jnCbrK the pressure builds #intellectualmonopolies

  9. "Nobody wants patents except patent lawyers and a few specific companies […] to tax the public" http://ur1.ca/4dm7k via @glynmoody

  10. 2011PirateparteiLu: RT @Falkvinge: on #infopolicy: Startup Investors: “Patents are a cancer” http://goo.gl/fb/lTEFi

  11. Travis McCrea

    Well said.

  12. "Nobody wants patents except patent lawyers" -Rick @Falkvinge » http://goo.gl/F3lAq

  13. Startup Investors: “Patents are a cancer” http://zite.to/jIqYFC via @Ziteapp

  14. Larry

    I agree that the current patent system is severely broken, but I’m not convinced a no patents at all scenario is optimal either. I’d rather see a gradual dismantlement of IP laws along with a way to measure the relationship between economic development and IP laws. So while the economy goes up following reductions in IP protection, keep dismantling IP protection, but if lowering IP protection starts to hurt the economy, then go back a bit and keep it at that optimal level. Realistically it’ll be a long process anyway, so an gradual approach will be much easier to pull off than doing all at once. (And possibly getting it wrong!)

  15. Robert Wensman

    Great you bring this topic up! I totally agree with your solution!

    Here is a good example. This american inventor has worked alone on a new engine design for years:

    http://www.angellabsllc.com/

    Now some russians just copied it:

    http://pesn.com/2011/04/23/9501814_Russian_firm_claims_MYT_engine_design_its_own/

    So we have progress!

    What if that first inventor had just been able to withold this invention from the world?

    1. rutros

      This is a development of the Wankel engine, that was on the market in the 60th.
      http://sv.wikipedia.org/wiki/Wankelmotor
      Probably with the same short life as well.

      What chance do you think this inventor should have without his patented system?

  16. Charley

    I disagree. Patents are good. They are too weak, in fact. I am an inventor. Even if your idea is properly patented “big, powerful companies ” can still manage to steal it. If you, the engineer, have a new idea or process then you have to do what we inventors have to do: check it with a patent search. “Crystal Plaza time”.
    If it has already been thought up then you have to make a deal with the inventor. That’s only fair. Although fairness is not what you had in mind. Everything is not free. Not free for the inventor, who has to live a hard life. Not free for the engineer who wants to use the idea. First come, first serve. Make a deal. What I’ve found is big companies don’t want to pay me anything. Paying any amount is “cramping their style”. That what patents are for. Those guys. To at least, try to keep them honest.

    1. Rolf

      Except, of course, that it doesn’t really work, does it? You more or less say so yourself, even. Ah, well. Your post relates to the patent system as it is (was?) *supposed* to work, and not at all to how it is actually (ab)used. Patents don’t work for the little guy. They are abused by the big guys. It’s getting worse over time, and not better.

      This is the entire *point* of the main post.

      1. rutros

        Patent is not perfect for the little guy, especially in the US., However patent is this is the best protection that is offered to him. Without patent he has no chance at all. The market leader will always copy, lower the price and the little guy will broke. Microsoft, GE and the big ones do perfectly well without patent, contrary to what is stated above . They are not lobbying for escalation of patents.
        I am of course referring hardware patent, software patent is different and is an abuse of the patent system and creates problem for everybody.

        In US there are 30 000 patent lawyers but millions of R/D engineers.

    2. Mumfi.

      Also, why ”first come first serve”.

      If I invent something, a fact in itself that indicates it is trivial and need no protection, why should I pay you just because you invented it also. Is it not more true to say that solutions will be found, based on our current understanding of the world, once the problem presents itself?

      A better way is to let the companies compete on implementation. Not on invention. Implementation is the hard part, and the part that is interesting for consumers. If an inventor has a patent that is nontrivial, and thus valid according to how patents were intended to work, he often also has a prototype. That is an implementation! Instead of a lengthy and costly patent application process, for a patent he has no economic muscle to protect; he might as well show it to investors as a black box and sell his expertise in implementation to some company.

      In the one field where it is really difficult to find solutions, mathematics, there are no patents. Go figure…

  17. NingúnOtro

    Patents, as they stand now and are abused by big companiçes are a cancer, agreed… but big money pools, as held by venture capitalists… are no less a cancer.

    Patents are instruments that can be abused

    Patents would be no real issue if there were not those amounts of excess money wandering around buying them to siphon off ROI potential.

    Money is an instrument that can be abused.

    What we see and identify as abuses in the use of patents, and in the use of money… are symptoms.

    All results obtained by man act as symptoms… all causes are to be sought in the way man THINKS… because it is when he thinks that he constructs the processes that ultimately leave the traces in the world as we can observe them… symptoms by which we can try to reconstruct the thought process that lead him to act in such a way as to leave the kind of testimony we can observe (you need to have an armored stomach for some of these, beware).

    Should we not aim to dismantle the money system too?

  18. Bodil Stokke (@bodiltv)

    Startup Investors: “Patents are a cancer” – http://bit.ly/joSdTJ If you’re for patents, you can’t be my friend.

    1. rutros

      What do you know about trying to get money to develop an hardware idea or a new drug?

  19. rutros

    Now, Falkvinge is on line again, twisting facts and trying to imply that experiences from software patents in USA are valid all over.
    Falkving states: Startup Investors: “Patents are a cancer”
    But this is false, taken from its context. The investor talks about software patents. The article starts as follows
    “Enough Is Enough
    I believe that software patents should not exist. They are a tax on innovation. And software is closer to media than it is to hardware. Patenting software is like patenting music.”

    All this is pointed out in the comments to the article, which Falkvinge obviously didn´t care to read.

    He also makes a statement of what happened on the 17th century, which as a matter of fact is impossible with modern patent law.

    However, this raise a question to us. Is Falkvinge to be trusted at all?

    I am happy that a overwhelming majority of the pirate movement have left Falkvinge´s view on elimination not just software patents but all patents since long.

    1. Bonk!

      Rutros Falkvinge clearly can’t be trusted as his biased rambling are sprouting out of him from all openings.
      Unfortunately a lot of young naive piratepeople look up to Falkvinge and see him as a fatherfigure who can do no wrong. But boy! These naive people are in for a surprise when they wake up..

  20. […] seasoned startup investors absolutely hate patents and the entire patent system. They compare it to a cancer in the economy. As soon as a company has any money at all, it will be sued for patent infringement on pure […]

  21. Slasher

    Alot of the big companies just use patents to lock up the competitiors choses and/or trade patents in between. Sometimes they also like to use it as a measure of how technically advanced they are. Some good examples are the patent fights between HTC and Apple.

  22. […] Feit: De doorgewinterde investeerder haat patenten en het hele patentsysteem. Patenten worden zelfs gezien als een kankergezwel dat in het huidige economische systeem zit. . […]

  23. […] seasoned startup investors absolutely hate patents and the entire patent system. They compare it to a cancer in the economy. As soon as a company has any money at all, it will be sued for patent infringement on pure […]

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