Jan 21 2007

Empirical Evidence of Why Software Patents Are Bad (or Good) – Part 1

I’ve written plenty about patents in the past, including a provocative post titled Abolish Software PatentsI was having a conversation with John Funk, a partner in Evergreen Innovation Partners, at the end of last year after a catch up lunch.  We got into a serious conversation about the fact that so much of the software patent good vs. bad rhetoric seems like it’s more about opinions, anecdotal experience, and agendas – rather than a comprehensive review of the facts.  So – we decided to take it up a level and see where the conversation went.

Now – John and I have some interesting history around this.  We have been colleagues (I was an investor in Exactis (fka Mercury Mail / Infobeat – his first company), adversaries (Infobeat sued a company I co-founded – Email Publishing – for patent infringement – which was eventually settled for $1 and a cross-licensing agreement between Exactis and MessageMedia (the company that acquired Email Publishing)), and once again friends and colleagues (I’m an investor in John’s latest company, Evergreen IP.)  While we’ve both struggled personally with an emotionally charged issue, we’ve ended up friends. 

Interestingly, given the wide range of experiences we’ve each had around software patents, we have pretty similar views.  So – John fired off a long email to me which I’ve edited and broken up into several posts with the following premise: What if we attempted to craft a social policy hypothesis that would defend the existence of software patents, and then we went about creating an experiment that would attempt to disprove that hypothesis?  Hmm – social science – disproving a null hypothesis – how academic!

Let’s begin with this: Patents in general, and software patents in particular, are a government conferred monopoly that rewards the public disclosure of a software method or program. The rationale for patents is anchored in (1) public disclosure accelerates innovation because future invention rests on prior patent disclosures (e.g., innovation is a chain that builds on prior building blocks), and (2) conferring a patent monopoly will encourage innovation that otherwise would not occur due to perceived risk/return (e.g., in absence of patents, competitors will trounce new entrants by rapidly copying; therefore monopoly is needed to be able to raise capital and take the risks).

More coming in part 2 – same bat time, same bat blog.