December 20, 2005

Broken Patent System

The current issue of BusinessWeek online has a viewpoint piece by Greg Blonder, a former AT&T Bell Labs employee who is now a venture capitalist. He explains how the "current U.S. [patent] system is harming innovation".

I could not agree more, but the question left unanswered is who benefits from the current system and why is it so hard to change. I think the main beneficiaries are the lawyers and since lawyers are prominent in congress they are reluctant to do anything that will harm their profession. While at AT&T Labs I tried unsuccessfully to find out the total amount of money spent per year to obtains patents versus the yearly amount of money received from patent royalties. My guess is that only the lawyer made money.

It is often assumed that patents protect the individual inventor and small businesses, but in fact patents are mainly used by big businesses to protect their monopolies. Large companies sign cross-licensing agreements with other large companies and except for a very few high profile exceptions, small companies and individuals do not have the resources to fight big companies over patent rights.

Posted by mjm at 08:03 PM | Comments (1)