Initial rant on patents

My take on patents is what you might call "evolving". You might also call it "random" or "wishy-washy", but that would be mean. I want to write this post so later I can refer to what I thought in the past to see if my viewpoint is at least converging on something. Also writing helps me sort out my thoughts.

Disclaimer - I've put this post off for probably a year, so even if this isn't properly researched, I'm going to finish it so at least something is written down, and then I'll be forced to update my viewpoint by posting more, and showing proofs. It's going to be a wall of text with hopefully not too much rambling. But there will be a bit of ramble. I'm also assuming the audience of this article (if any) knows something about patents and their basic mechanics.

What does the system do?

The way our patent system is setup has a number of effects on our economy and society. Some are desirable, some not. Some might be called "side effects", but to paraphrase Kas Thomas, nothing produces "side effects", they're all just "effects". So to treat all effects of our current system equally, I'll just list what I can think of below:

  • The owner of a patent controls anyone else's ability to sell or operate using that invention
  • Patents go to the first person to file one, not to the first person to invent the invention
  • Independently coming up with an idea, if it is the same as a registered patent, doesn't let you use that idea (it's owned by the patent)
  • Patents can be invalidated by proving that the idea was public knowledge before the patent was registered (prior art)
  • Patent litigation is very very expensive
  • Small software companies often run afoul of patents they did not even know about
  • Easily copied, high capital investment products, such as medicine, are able to use patent protection to charge enough to repay research costs before generics undercut them
  • NPEs (non-practicing entities, often called patent trolls) have sprung up to sue any business entity that violates one of their patents
  • NPEs do not sell a product or service, so they are at no risk of violating other's patents, and therefore cannot be counter-sued by the companies they attack

There are many other effects, but I think they just start to overlap and be mostly covered by these in the list.

What is the goal of the patent system?

The patent system has tons of effects as seen above, but why was it setup? What were the primary goals? The arguments I've heard fall into 4 categories:

  • Encourage people to devote time to invent things they wouldn't have otherwise
  • Encourage people to disclose their inventions to the public
  • Give inventors a chance to earn back the money spent on high-cost invention
  • Give inventors a just reward for their hard work, to show that their actions have value

These reasons blend together at the seams, but I'll try to treat them separately.

Encourage people to invent

The monopoly power that patents give to inventors might incentivize an innovative problem solver to spend time inventing, rather than other pursuits. This goal of increasing innovation comes from the idea that innovation is good for society and/or the economy, which I agree with. Next, this goal assumes that inventors are not encouraged enough by either intrinsic motivation, or the business advantage of being the first-mover. I'm not convinced this second point is true, at least in software, as shown by the number of people explicitly inventing and creating in the OSS world.

Encourage people to disclose

The reasoning here is that patents are an agreement with the public. If an inventor discloses to the public how to build or recreate their invention, the public will reward the inventor by giving them monopoly rights on that invention for a number of years. I'd like to look at this goal in isolation, so I will assume that the invention has already been created, and the alternative is that the inventor will sell the end-product without telling anyone how it was created. The losses to society here could be that the company goes out of business at some point and the knowledge is lost forever, or that duplicated effort is wasted by other companies trying to discover the same process.

For this goal, the length of monopoly rights only need to be long enough to encourage disclosure that would otherwise be hidden. This means that for something like Plexiglas, where the patentable creation process is not obvious from the end-product, a patent encourages the knowledge to be released to the public when normal business operations of selling the Plexiglas would not have revealed anything. For something like Amazon's One-click patent, the innovation is user-experience design, which is revealed immediately upon using the patent. In this case, there is no reason to incentivize disclosure because it disclosure is inherent in using the knowledge in business. Amazon's other alternatives were to not create or use the invention at all, which falls under the Encourage people to invent or Allow return on high development costs goals, not this one.

Allow return on high development costs

This is partially an extension of the first goal. Some areas of invention have such high capital costs (to create the first product), but such low reproduction costs (to replicate each copy of the product after that), that they are unpalatable for businesses unless protection is provided. This is only really a concern if the output of these areas of invention is needed or desired by a society, otherwise who cares if no one bothers to invent in those areas.

The best and most obvious example is medicine. Developing and bringing to market a new drug costs a lot. Part of this is inherent, and part is artificial. The inherent part, that labs cost a lot, and this process involves a lot of expensive trial and error, is unlikely to fundamentally change, though technological advancement might give us some leeway. The artificial part is the government regulation. Our clearance process that drugs must go through before being sold to the public is long and expensive. This is unlikely to drastically change as medicine is an area where the average consumer is not qualified to decide which products are safe and which aren't if a regulation body with experts does not do most of the work.

This argument has the most traction for me, but it does not imply that we need a general patent system, only that we need a specific system that only allows patents in very restricted areas of the economy. Medicine is the best example, with other sectors of the economy being added only if they could show that the sector's output is important to the well-being of society and that without protection, the sector will not innovate.

Ensure inventors are rewarded to show their actions have value

This is a general moral argument that inventors are entitled to monopoly rights so they have a chance to get a reward for their work. This argument bugs me. For it to hold any weight, the parallel-invention problem must be solved (a second inventor who comes up with the same idea must also have a "right" to get a reward). As is, only the person who invented the thing, then paid tens of thousands of dollars to patent it, gets the protection. The other guy who came up with it independently doesn't even have the right to use his own idea, much less the right to bar everyone else from "sealing it".

I also dislike this argument because it feels like a "think of the children" emotional appeal that encourages overlooking the downsides of the system. If I think a sector of the economy doesn't deserve patents, then I'm branded as saying that the work those inventors do has no value. Pointing out the inherent advantage of being first to market with your new idea doesn't save me from claims that I want less appreciation for inventors. "OMG YOU HATE INVENTORS!"

Wall of text

Yes, that was a giant wall of text. Writing it out helped me to form my viewpoint a bit more, and posting it will let me refer back and contradict, evolve, and update different parts of it. Now that I have a baseline to work from, I will hopefully put myself on record more often.