Saturday, August 21, 2010

Speaking of Mouse Trap Economics, What About that Yarn that Patents Stimulate Invention: Les Earnest Testifies Before the USPTO

This posting is a continuation of a previous LawPundit posting on Mouse Trap Economics.

About those "Stimulating Patents"
LES EARNEST testified before the USPTO

more than 15 years ago
(January 7, 1994)

MR. EARNEST: Les Earnest, speaking for myself.

Based on my 40 years of experience in the computer system development, much of it before software patents were introduced, I believe that the alleged connection between such patents and the stimulation of innovation is tenuous at best and probably negative. Let me confess that even though I oppose the continuation of software patents, as a defensive measure I've applied for some that have been granted.

When I entered the field as a programmer in 1954 there were only about a hundred of us in the whole world, and each of us was turning out thousands of inventions each year, or maybe it was hundreds depending on your standards, but a lot. Software was given the same kinds of protection as other documentation, namely copyright and trade secret.

It was certainly a good thing that there were no software patents because my colleagues and I could have papered over the field and retired for 17 years or so to collect royalties. Since patents didn't exist, we kept working and had quite a good time doing it, sharing ideas and standing on each other's shoulders to see how high we could reach.

In 1956 I went to MIT to help design the Sage Air Defense System, it was a technological marvel full of inventions, both hardware and software. It was the first real_time computer system and depended on the large software system that was cooperatively written by many people. That was the first such system.

This project helped transfer a lot of technology from MIT to IBM, but almost nothing was patented. Dozens of Sage systems were eventually deployed around the country, each with a vacuum tube computer that covered a floor area about the size of a football field and an air conditioning system to match.

It is fortunate that this power, that the Soviet Union, never attacked the U.S. in that era, because the marvelous technology in Sage had several Achilles' heels that would have caused it to fail catastrophically under attack. However, those short comings were kept well hidden from Congress and the public, and as a result the so_called command control communications technology became a major growth industry for the military industrial complex. The most recent example of that line of development being the grossly defective Star Wars system, but that's another story.

Beginning in 1959 I developed the first pen_based computer system that reliably recognized cursive writing. I believe that it was more reliable than the 1993 version of Apple's Newton. But the idea of getting a patent on such a thing never occurred to me or my colleagues. It wouldn't have done much good anyway because the computer on which it ran filled a rather large room, and the 17_year life of the patent would have expired before small portable computers became available.

In order to cope with a personal shortcoming, I developed the first spelling checker in 1966.

(laughter)

I didn't think that was much of an invention and was rather surprised when many other organizations took copies. And, of course, nobody patented things like that.

When John McCarthy and I organized the Stanford Artificial Intelligence laboratory, and I served as its executive officer for 15 years, there was a great deal of innovation that came out of there, including the first interactive computer_aided design system for computers and other electronic devices, early robotics and speech recognition systems, the software invention that became the heart of the Yamaha music synthesizer, document compilation and printing technologies that later came to be called desktop publishing. The Sun workstation was invented there. And the guy who invented public key cryptography was in our lab.

Few of these inventions were patented in the early period, but we later began to file for such coverage. The pace of innovation I note has necessarily slowed over time as the technology matures, but concurrently, of course, the amount of patent protection has increased. I suspect that these changes are connected.

Yesterday in this forum, my friend Paul Heckle said that software patents stimulate new businesses. I'm afraid that Paul has that backwards. In fact, new businesses stimulate software patents. Venture capitalists want the comfort of patents on products that are being brought into the market even though know_how is far more important in most cases.

In 1980 I co_founded Imagen Corporation, which developed and manufactured the first commercial desktop publishing systems based on laser printers. We filed for software patents to try to appease the venture capitalists, even though it was not actually important to our business, I believe. Of course, they didn't understand and the lawyers were happy to take our money.

Based on my experiences, I also joined the League for Programming Freedom to help resist the patent conspiracy and I later served for a time on its board of directors.

In summary, for many years there has been a great deal of innovation, there was a great deal of innovation in the computer software field with no patents, under the quote, stimulation of software patents the pace now seems to have slowed. I believe that there may be a connection, not only because of the time that must be devoted to covering and deciding what to cover and filing a patent application, but also because patents are owned by other organizations, many of them in fact based on prior art, and constitute a mine field that must be carefully navigated. I recommend a return to the good old days when success depended on moving faster than the other guys rather than trying to catch them in a trap.

[bold emphasis added by LawPundit]

Thank you.

COMMISSIONER LEHMAN: Thank you very much, Mr. Earnest.

[LawPundit note: Les Earnest writes at a web page at Stanford.edu as follows:
"Incidentally, in my opinion creating a computerized version of a function that already exists should be viewed as an adaptation rather than an invention, even if it greatly increases functionality.  Indeed, I believe that the U.S. Patent Office has gone off the deep end in recognizing many “inventions” that are nothing of the kind.  Nevertheless, following popular usage I will use the term “invented” instead of “adapted” for some computerized versions of old ideas."]

Germany's 2nd Quarter 2010 Economic Growth Largest on Record

German Missions in the United States - Second Quarter Growth
"Germany’s economy in the second quarter grew by the largest margin ever recorded in reunified Germany...."

Mouse Trap Economics: Give us a Billion Dollars Says the Judge on Behalf of the USPTO : Did Bilski Kill Sensible Patent Reform?

Beware of the consequences of Bilski.

Has Bilski killed patent reform?

Rick Merritt at The EE Times in Support for patent office rises as reform bill wanes reports on a story which has for all practical purposes been going on for 55 years now, namely the lack of any type of patent reform by U.S. Congress, as both houses persist in juggling pending legislation and ultimately getting nowhere.

It is just so much more fun and politically -- individually -- more useful for Congresspeople to waste thousands of Congressional man-hours uselessly grilling shoo-in Supreme Court nominees rather than getting down to business and doing what they are supposed to be doing in Washington, D.C., namely, solving the nation's problems.

Small wonder then that, Paul Michel, the retired (May 31, 2010) former Chief Judge of the U. S. Court of Appeals for the Federal Circuit -- the "specialized" appeals court for patents -- not content with the shambles left behind in the patent world during his tenure, in an op-ed to the New York Times together with Henry R. Nothhaft, now with a straight face recommends in Inventing Our Way Out of Joblessness that Congress should give the USPTO a "small" $1 billion shot in the arm to reduce its patent backlog of 1.2 million applications, a new kind of "bailout" for what Michel sees as the holy grail of releasing the economic power of currently pending inventions.

In a new kind of "mouse trap economics", Michel estimates that the $1 billion USPTO bailout would create as many as 2.25 million jobs over the next three years, a remarkable economic calculation by which every ca. $444 gifted to the USPTO would create 1 new job. Wasn't it the Alice in Wonderland economics believed in by the Bush Administration that for every $300,000 in tax cuts gifted to the rich, one new job would be created? Nothing of the sort happened. How baffled the economists should now be to learn how much easier they could have created new jobs just by giving much less money per desired job creation to the USPTO.

It remains a remarkable fact in spite of articles such as those by Michel, that there is no probative empirical evidence whatsoever that patents themselves greatly stimulate either the economy or the job market. INVENTIONS may do that, but this has nothing to do with patents per se, rather it relates to the exploitation and implementation of new ideas, which is necessary in nearly every business, and usually accomplished without patent monopolies.

The success of new start-ups such as Facebook shows that it is the ideas themselves, their implementation and their funding through venture capital that initially determine what happens with new INVENTIONS. The copyright, patent and trademark monopolies come later. Patents do not drive the economy.

Rather than fueling the economy, a good argument can be made that all of these monopolies stifle creativity and merely shuffle money into fewer and fewer pockets.

Outlandish analysis by persons such as Michel obscure the severe structural weaknesses that mark the American economy, an economy floundering as the result of decades of plundering of the economy by monopolies of numerous kinds, including patents, leading to an egregious inequality of income distribution, the outsourcing of large chunks of the economy to the third world and, when that was not possible, to cheaper and cheaper labor domestically.

No amount of invention will solve those problems, nor will the job market be healed by more and better mousetraps. The mouse is gone.

You want to jump start the economy into a whirlwind dash toward the future? How about if we close down the USPTO entirely and invalidate all patents and similar ill-conceived monopolies as of tomorrow? That would get things moving. You bet. It would stimulate a "free for all economic miracle". Right now, the economy is tied in chains. People such as Michel just keeping adding new links to those same chains to keep the economic -- and democratic -- giant beneath them from bursting out.

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