Into Tech

We’ve been pointing out how the movie industry appears to ifinally/i be realizing that they need to give people a reason to go out to the movies, now that they’re competing with home theaters, and many are doing that by making use of things like a href=”http://www.techdirt.com/articles/20080721/2256451753.shtml”IMAX technology/a that simply can’t be reproduced in the home yet. Now, a href=”http://blogcampaigning.com”Parker Mason/a notes that the next version of the movie iIron Man/i is supposedly a href=”http://io9.com/5048799/iron-man-2-to-be-in-3d-and-imax-and-maybe-give-back-rub-too” target=”_new”going to be in both 3D and IMAX/a — again, trying to give people real reasons to actually go out and see the movie as a social experience. It’s nice to see the industry recognizing this, though it would be better if the rest of the industry stopped freaking out about piracy and a href=”http://www.techdirt.com/articles/20080914/2237332263.shtml”DRM/a and put more resources into giving people reasons to pay.
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By this point, it should be rather clear what we think of a href=”http://www.techdirt.com/search.php?site=#038;q=Myhrvold”Nathan Myhrvold’s Intellectual Ventures/a project. It’s perhaps the biggest threat to innovation around, as Myhrvold is collecting a ton of patents (now up to 20,000 apparently) and pressuring companies to pay hundreds of millions of dollars to get blanket licenses to avoid getting sued. It’s a scam to shift money away from actual innovators and into the pockets of lawyers and speculators. For some reason, though, Myhrvold has a knack for getting press. His latest is a a href=”http://www.emailthis.clickability.com/et/emailThis?clickMap=viewThis#038;etMailToID=275993933″ target=”_new”profile in the Wall Street Journal/a that covers much the same ground as previous profiles in places like a href=”http://www.techdirt.com/articles/20060626/1011256.shtml”Business Week and Fortune/a.
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So what is new in this one? Well, less than a year after a href=”http://www.techdirt.com/articles/20071112/191128.shtml”raising a $1 billion patent hoarding fund/a, he’s out raising a inew/i b$2.5 billion fund/b. So it seems like he’s good at getting press and raising money — but not so much actually making money at this point (well, Myhrvold personally is doing fine, since the piece notes that he gets a 2% management fee, just like a VC). And that’s where the saber rattling comes in. The article notes that Cisco and Verizon have paid up between $200 and $400 million as licensees — though, to make it more confusing some of that is invested back into the fund for equity. Thus, it’s not really clear as to how much is being used specifically to license patents. The article also highlights that some of Myhrvold’s earlier investors are going to start wondering when the fund is actually going to bring in some real revenue.
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Another oddity is the vast amount of secrecy surrounding Intellectual Ventures. Anyone who sells a patent to the company or who licenses patents from the company are required to sign extensive non-disclosure agreements. When asked why, Myhrvold skirts the question by claiming many companies don’t want to reveal what they’re doing with IV. If that’s true, though, why do they need NDAs in the first place? The company also uses an array of secret shell companies to go around buying patents, again raising questions about what it’s doing. If the company is really so proud of its business model and doesn’t think it’s shameful, why is it hiding behind shell companies like garden variety a href=”http://www.techdirt.com/articles/20071127/015820.shtml”patent hoarders/a. But, as we’ve learned, patent hoarders very much a href=”http://www.techdirt.com/articles/20080815/0346231992.shtml”rely on secrecy/a to convince others to pay up.
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And, then, of course, there are the myths that Myhrvold loves to repeat, but no reporters ever push him on. He insists that those who disagree with his business model are merely “infringers.” Yet, as we’ve all seen, so many patent infringement lawsuits these days are hardly about actual infringement, and much more about a company that didn’t succeed in the marketplace suing one that did. He also repeats the myth that patent lawsuits are decreasing, claiming that the number of lawsuits peaked in 2004 and has been declining. That’s misleading because it ignores the fact that patent hoarders are now suing larger and larger groups of companies in a a href=”http://www.techdirt.com/articles/20071130/010512.shtml”single lawsuit/a meaning that the number of companies being sued has been a href=”http://www.techdirt.com/articles/20071221/012831.shtml”increasing rapidly/a.
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Either way, Myhrvold may want to close that new fund as quickly as possible. The a href=”http://www.techdirt.com/articles/20080409/011406799.shtml”Bilski ruling/a that could put an end to software and business method patents is expected sometime in October, and it could put a big dent in his patent portfolio.
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The EFF sure has been busy today. First it a href=”http://www.eff.org/press/archives/2008/09/17″filed a lawsuit against the US Trade Representative/a for keeping info on the a href=”http://www.techdirt.com/articles/20080916/1839352286.shtml”ACTA negotiations/a secret, and then it a href=”http://www.eff.org/press/archives/2008/09/17-0″ target=”_new”sued the NSA, President Bush and Vice President Cheney/a over the warrantless wiretapping issue. Must be a busy day at the EFF office. In both cases, it seems likely that the lawsuits may draw some additional attention to the issues, but it seems unlikely to have much of an impact on actual government policies.
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a href=”http://torrentfreak.com/study-says-intellectual-property-system-should-die-080911/” target=”_new”TorrentFreak/a alerts us to the latest in a long line of research that a href=”http://www.theinnovationpartnership.org/en/bioip/report/”highlights just how damaging the intellectual property system has been to innovation/a. This isn’t new, of course. We’ve been pointing to tons of research on this subject for years, but it’s great to see some more to add to the pile. And this isn’t just a couple of folks with an opinion either — but a seven year study, involving a large interdisciplinary team of folks examining all aspects of intellectual property, with the main focus being on the biotech industry. The report hits on a few key themes we’ve highlighted over the years:
blockquotei
The current era of intellectual property is waning. It has been based on two faulty assumptions made nearly three decades ago: that since some intellectual property (IP) is good, more must be better; and that IP is about controlling knowledge rather than sharing it. These assumptions are as inaccurate in biotechnology – the field of science covered by this report – as they are in other fields from music to software.
/i/blockquote
The full report is a good read. It’s well researched and documented, and points out that listening to IP lawyers alone, or just looking at IP laws is a huge mistake in analyzing the overall impact of IP:
blockquotei
An analysis of IP laws alone gives a distorted understanding
of how IP facilitates innovation and dissemination. Such
an analysis must be complemented by an understanding of
business and governmental practice as well as the public
and private institutions and entities that create, grant and
govern IP.
/i/blockquote
There’s plenty more in the report, and it’s all footnoted, and some of the additional research is new to me and will be fun to explore over the next few weeks.
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However, while the report’s description of the problems is dead on, the report runs into trouble when it gets to the “and what do we do about it” section. It talks a lot about “new IP” which is vaguely defined, and involves a lot of wishy-washy statements about trust and collaboration and openness. It basically suggests that a bunch of different parties all have to start acting differently but doesn’t necessarily explain why or how that will work. That seems… difficult, and a tad idealistic. This is really too bad, given how solid the earlier part of the report is. It’s almost as if the group putting together the report saw all the problems, but couldn’t come up with really concrete solutions. That’s unfortunate, given that plenty of folks have shown real world examples of how the system can work just fine by simply removing IP from the equation, and watching the business models that result. Overall, this is an excellent addition to the literature in looking at the iproblems/i, but comes up short when it gets to the isolutions/i side of the discussion.
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We’ve pointed to a bunch of stories that involved Apple somewhat a href=”http://www.techdirt.com/articles/20080905/1631352184.shtml”arbitrarily/a forbidding or a href=”http://www.techdirt.com/articles/20080807/2107381925.shtml”banning/a iPhone apps, but now it appears that the courts are getting in on the game as well. A German court has a href=”http://www.theregister.co.uk/2008/09/12/german_court_bans_voip_on_iphone/” target=”_new”banned a VoIP iPhone app/a after T-Mobile, the mobile operator who offers the iPhone in Germany, complained. The court says that this VoIP app “makes use of unfair business practices,” though it’s difficult to see how. VoIP is a perfectly acceptable application, so why is it unfair? The court’s explanation here seems a bit stretched as well. Apparently, the only way to run this particular VoIP app is on a jailbroken iPhone, and T-Mobile’s contract forbids jailbreaking the phone. Of course, if that’s true, isn’t it an issue between T-Mobile and its customers who broke the contract? Why should the app maker be blamed? All it did was build a useful app? This seems like yet another case where a company is arguing that a href=”http://www.techdirt.com/articles/20071004/163314.shtml”interference with a business model/a should be illegal.
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We’ve noted the very clear a href=”http://www.techdirt.com/articles/20080625/0045471509.shtml”shift in patent strategies/a at Microsoft over the years — from a company that hated patents to one that now views them as central to its mission, and often uses them to a href=”http://www.techdirt.com/articles/20071009/135529.shtml”threaten/a competitors. However, you want to know when things have really gone too far? It’s when the company is a href=”http://news.cnet.com/8301-13505_3-10041410-16.html?part=rss#038;subj=news#038;tag=2547-1_3-0-20″ target=”_new”sending out the legal department to provide press quotes on a “product launch”/a that is tied to a technology licensing deal. As Matt Asay points out in the link here, in a story about Novell launching Linux on a Windows virtualization offering, there are two quotes from Microsoft employees — and both appear to come from the legal department rather than a product role. What used to be an innovative company working on new stuff is apparently turning into a legal firm trying to put tollbooths on innovation. It’s sad.
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If you follow the various RIAA lawsuits against music fans over unauthorized file sharing, you certainly know the name Ray Beckerman, a lawyer in New York who not only has defended clients against the RIAA, but runs a wonderful resource, called a href=”http://recordingindustryvspeople.blogspot.com/”Recording Industry vs. The People/a, that keeps people informed on various issues and cases related to the RIAA’s campaign. We a href=”http://www.techdirt.com/articles/20071211/101325.shtml”don’t/a always agree with Beckerman, though we do side with him in the vast majority of cases. He is fighting an important fight, standing up for people that the recording industry has often unfairly bullied through the use of questionable legal tactics and flimsy evidence. Before Beckerman came along and took a very public stand, a href=”http://www.techdirt.com/articles/20060406/0914230.shtml”exposing/a the RIAA’s playbook, there was almost no one in the legal community standing up to cry foul at the RIAA’s actions.
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Apparently, the RIAA has had enough of him, however, and has a href=”http://blog.wired.com/27bstroke6/2008/09/riaa-decries-at.html” target=”_new”filed motions against him directly/a, asking that he be declared a “vexatious litigant” and demanding monetary sanctions. Specifically, the RIAA is claiming that Beckerman made false statements, sending the RIAA off on tangential efforts, while trying to block every effort by the RIAA to obtain the evidence it needed in the case. Plus, the RIAA’s lawyers are not at all happy that Beckerman posted all of the motions he filed to his blog, claiming:
blockquotei
Finally, as this Court is aware, Defendant’s counsel has maintained an anti-recording
industry blog during the course of this case and has consistently posted virtually every one of his baseless motions on his blog seeking to bolster his public relations campaign and embarrass
Plaintiffs. Such vexatious conduct demeans the integrity of these judicial proceedings and
warrants this imposition of sanctions.
/i/blockquote
While it’s unclear how much truth there is to the false statements claims, complaining about the blog is simply ridiculous. From the beginning of the RIAA’s legal campaign, its own executives have always insisted that the lawsuits were part of an educational and PR campaign to promote that downloading was illegal. On the whole, the entire filing has the feeling of sour grapes on the RIAA’s lawyers’ part. They don’t like that they lost, and they hate the fact that Beckerman keeps exposing their tactics and flimsy evidence. Clearly, he’s getting under their skin a bit. It was much easier suing music fans with questionable evidence when no one was standing up for them.
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Looks like having poker lobbyists setting poker tables at both a href=”http://www.techdirt.com/articles/20080901/1724222141.shtml”presidential conventions/a this year was effective. A new bill is successfully moving its way through Congress that would a href=”http://www.informationweek.com/news/internet/policy/showArticle.jhtml?articleID=210602291″ target=”_new”effectively re-legalize online poker/a, reversing a law passed two years ago that made it illegal for financial institutions to accept payment for online gambling (all in the name of a href=”http://www.techdirt.com/articles/20061002/124356.shtml”national security/a, of course).
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Of course, the new legislation would also add some regulations to online gambling, banning wagers on sports — though, of course carving out an exception for the time of sports gambling that politicians a href=”http://www.techdirt.com/articles/20070112/155626.shtml”engage in/a: jai-lai, horse racing and dog racing — which would remain legal). Rep. Barney Frank who introduced the bill, noted: “Adults are entitled to do with their money what they want to do.” Of course, if that’s the case, why can’t they also wager on sports? Either way, considering the number of folks who have jumped through all sorts of hoops to continue playing poker online, this seems like a step in the right direction.
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Apparently a whistleblower recently leaked some evidence that German authorities were using a special trojan horse software to tap Skype audio conversations. The document detailing this was leaked to the German Pirate Party, one of many international “Pirate Parties” that have been formed in recent years to push for more reasonable government policies on a variety of fronts from intellectual property to privacy and government surveillance. Illegally tapping Skype conversations may be illegal, but it seems that German authorities are a lot more interested in tracking down who leaked the documents and a href=”http://torrentfreak.com/pirate-party-official-raided-after-uncovering-state-trojan-080917/” target=”_new”have raided the homes of various German Pirate Party members/a, confiscating computer equipment. Of course, if anything, this would seem to confirm that the government was at least experimenting with, if not actively using, such a trojan horse wiretapping program — and the raids have only served to generate much more attention over that fact.
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I recognize that I was in the a href=”http://www.techdirt.com/articles/20080905/1337532180.shtml”minority/a of folks who actually thought the Microsoft Bill Gates/Jerry Seinfeld ads were good and entertaining, but I’m still quite surprised to see Valleywag report that a href=”http://valleywag.com/5051455/microsoft-to-announce-jerry-seinfeld-ads-cancelled-tomorrow” target=”_new”Microsoft is ending the Seinfeld ads/a, despite plans for a huge $300 million ad campaign around them. Microsoft is trying to claim that this is a href=”http://news.cnet.com/8301-13860_3-10044931-56.html?part=rss#038;subj=news#038;tag=2547-1_3-0-20″all according to plan/a, but that seems difficult to believe — especially since the “narrative” of the ads had only just begun. It looks like Microsoft basically caved to all the online critics, which makes no sense to me. Even if some people didn’t get the ads, people were talking about them. Caving, rather than going through with the rest of the planned ads and laying out the message that they had planned to lay out, just makes the company look foolish. The first two ad segments clearly set the framework for numerous commercials that Microsoft could use to both humanize itself and inform people about what Microsoft was doing — and now it’s basically a dead end. Yes, there were some very vocal critics of the ads, but bowing to their pressure sends exactly the wrong message.
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