From srctran@world.std.com  Wed Feb  7 19:28:05 2001
Date: Wed, 7 Feb 2001 14:28:05 -0500 (EST)
From: Gregory Aharonian srctran@world.std.com
Subject: [Patents] Bessen & Maskin reply on software patent paper

Jim Bessen writes:
>  This is what the pro-patent forces do not do because they do not have
>the evidence on their side.

Come on Jim, neither side has any clear and convincing evidence of the
impact patents economically (outside the pharmaceutical industry). The
impact of patents is in general a minor financial concern for companies
(as compared to other business affairs), so measuring such a subtle
influence is difficult, either to prove patents are good or bad.

The pro-software patent side has an easy case to make - all they have
to show is that the impact of software patents in the software industry
is comparable to the impact of patents in other areas of technology. If
so, then there is no reason to discriminate against software patents in
the law.  And they can show this comparability by pointing to all sorts
of data (new journal articles on software, growing number of software
companies, the orders greater impact of NASDAQ on the health of software
companies, the relatively minor number of non-trivial lawsuit damages or
settlements awarded in software patent lawsuits, etc).  Certainly there
is more data backing this view, than the biased sampling of data you
used in your hypothetical model study.

The anti-software patent side has a harder case to make - to somehow 
show (with real data, not ancedotal stories and poorly researched
press clippings) that software patents are disrupting both the
software industry and consumers greater than in other industries.
And this is a hard argument to make, because the problems of bad
software patents (and I agree there are way too many) for the most
part pale in comparison to the problems with biotech patents (both
for biotech companies that increasingly are blocked out of promising
research areas because of patents, or consumers [especially in third
world countries
] who find it difficult to be able to afford to buy the new drugs).

That's why your paper is so disconcerting.  It models a very small 
subset of the dynamics of the software world, and analyzes a very
small subset of software industry financial data, to make some rather
strong conclusions about the impact of software patents.  I question
then the statistical reliability of your conclusions.

And with regards to the silly "loss of freedom" arguments, I know of
only one person ever thrown in jail because of an issue involving
patents (a student in Florida).  And the case had nothing to do with
software.  Similarly, I know of only one individual in the US personally
sued for software patent infringement, me.  Beyond that, any perceived
losses of freedom experienced by small software companies is probably
little more than an excuse to hide bad management.  Heck, someone should
suggest to L&H in Belgium that they blame their billion dollar losses on
all of those bad voice recognition patents they felt threatened by.  Not
true, but it would make the L&H story more spicy to read.

Greg Aharonian




