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Re: McCain Supports Monopolistic 'Ownership' of Mathematics, Ideas

  • Subject: Re: McCain Supports Monopolistic 'Ownership' of Mathematics, Ideas
  • From: Rex Ballard <rex.ballard@xxxxxxxxx>
  • Date: Wed, 10 Sep 2008 06:02:00 -0700 (PDT)
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On Sep 10, 12:53 pm, Roy Schestowitz <newsgro...@xxxxxxxxxxxxxxx>
wrote:

> ,----[ Quote ]
> | But the fact is. A company that wants to invest in patent lawyers can expand
> | the number of patents it holds as it likes. Just reallocate resources to the
> | legal department. And HP under Carly Fiorina did that, increased the number
> | of patents it applied for dramatically. But does it mean more innovation?
> |
> | [...]
> |
> | I recently noticed that SUN Microsystems announced to abandon its patent
> | inflation strategy as over-patenting was not worth the investment. It is
> | difficult to assess the strategic value of a mine field and you don't find
> | good data how much profit is generated by patents, which patents generate
> | profit or benefit for the company and which are not worth the investment. In
> | most companies investments in patents follow a rule of thumb. Large holders
> | seek profit with patent portfolios like hunters with a shotgun aim for a
> | flock of birds.
> `----

The irony is that most of the money made in patents comes from
treating the patent like a product, pitching it to lots of companies,
and seeing which of those companies want to give you a few cents for
every product that WILL USE your new invention.

I had a friend who patented something he called the "Glitch Master".
He lived in colorado which has frequent lightning storms that take out
the power for just a few seconds.  He figured out a way to charge a
capacitor slowly so that you didn't need a great big transformer to
deal with the surge.  The original thought was to put the glitch-
master in PCs so that when the power blinked out, a huge capacitor
would keep the PC running long enough for the power to come back
online.

After pitching it to many companies, they found a new market, in
laptop power supplies and very light-weight power supplies for
computer accessories.  These days nearly all power supplies for
computer accessories and laptops use the "glitch master" device (not
sure if that's what it is still called).  He makes about 2 cents for
every one of these that gets sold (or the device it's sold with), and
as a result, he has a comfortable income.

The device was pretty simple, but he and his small company pitched it
to a whole bunch of companies.  At first, they all said no, but one
suggested the use is smaller power supplies, and they applied for a
new patent, which he gets paid for.

Companies rarely make much money just filing a patent and then waiting
for some company to accidentally infringe so that they can file a
lawsuit.  More often than not, the company hasn't even heard of the
existence of the patent, and they can easily claim that the device was
intuitively derived.  Even if they are lucky enough to keep the
patent, the royalties are also likely to be very disappointing.
Often, it's less than 1 cent per item, in the case of a settlement.

The people who make any money on patents are the ones who file for the
patent and then pitch the daylights out of the product, and keep
detailed records of everybody they pitch.  That way, the prospect
can't say "not interested" and then use the device, claiming that they
intuitively derived it.

When a company really likes an idea, they are usually willing to pay a
penny or two per item, and if that turns out to be 20 million items,
then you might actually get a few hundred thousand dollars out of the
deal.

Big companies file patent applications for almost every aspect of
every device they make, and they assume that about 80% of those
patents will be rejected.  They don't do it because they want to make
a $billion suing some other company.  They do it so that they won't
have some ambulance chaser papering them into a few million in legal
bills fishing for a fat settlement (for which he gets a contingency
fee).

> http://stopsoftwarepatents.org/forum/t-86439/mccain-senior-advisor-ca...


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