3 ms·

There are some big companies out there with a lot of their on-the-books valuation existing in the form of software patents. If they suddenly have to mark that s

by tkeller 16y ago

There are some big companies out there with a lot of their on-the-books valuation existing in the form of software patents. If they suddenly have to mark that stuff down to zero, imagine the crash...

deleted 16y ago
[deleted]
olalonde 16y ago
I assume they would have to continue enforcing patents for some years to come, but stop granting new ones.
SwellJoe 16y ago
Only patent trolls would crash, which is almost entirely private equity. Let them crash. In fact, I'd argue that it would be a great good for the market in general to knock the wind out of the parasites who live off of software patent trolling. Microsoft, IBM, Oracle, etc. companies that make money from legitimate sources would be barely effected at all (and many tech companies who have huge patent portfolios have spoken in favor of ending software patents or making them less broad). And, startups could breathe a sigh of relief and stop worrying about being the subject of extortion the day they turn a big enough profit to be a target of patent trolls. Besides, this is about how the USPTO grants software patents. It's not about revoking them or abolishing existing patents, though lawsuits to break some of the more pernicious ones probably would follow.
- tkeller 16y ago
  This is simply not true. Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books. If the accountants suddenly had to revalue them to $0, it would unquestionably have a big impact on the share price.
  - nitrogen 16y ago
    Should that be a consideration when deciding whether to abolish software patents? If nothing else, the USPTO can grandfather the existing patents in, but restrict the ability of their owners to use them aggressively.
    - tkeller 16y ago
      Should it? I don't know. Will it? Absolutely. And what does "aggressively" mean? Making a patent unenforceable will have the same effect as invalidating it.
  - SwellJoe 16y ago
    Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books. I'd need to see some evidence of this assertion. When I was spending a lot more time researching tech stocks than I do now (now I spend 0 time researching tech stocks), I never saw a patent portfolio as a significant portion of the value of the companies I was investing in. Revenue and growth is king in tech company stocks. Book value is pretty much considered a big goose egg in software companies because they tend to have so little of it compared to old blue chips that have factories, brick and mortar stores, or infrastructure that has real world value. I'd be absolutely stunned if marking down their entire patent portfolio had more than a 1% impact on their market value, because I suspect even less than 1% of their revenue comes from patents...and revenue and growth is how people value MSFT.
bhiggins 16y ago
There were some folks who owned a lot of slaves back in the day, too. Not a good argument, by itself, sorry.
- lukesandberg 16y ago
  not really a fair comparison. Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle to the overarching concerns of Justice and Morality. However, as evil as you may think software patents are, they are not on the same level. The USPTO should consider economic ramifications of a decision to stop issuing software patents, or to invalidate patents. I'm not saying they should not go ahead and do it, but it would be irresponsible not to consider any potential negative effects.
  - deleted 16y ago
    [deleted]
  - metageek 16y ago
    "Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle" -- It wasn't obvious when slavery was legal.
    - lukesandberg 16y ago
      True, that was mostly certainly historical relativism on my part. Maybe in 100 years people will look back on patent lawsuits similarly... but i doubt it
- tkeller 16y ago
  Seriously? This is your argument? Comparing software patents to slavery trivializes the suffering and evils of slavery.
  - nitrogen 16y ago
    Perhaps independent developers feel like prisoners (slaves may be too strong a word) where the wardens are software patents. If you ask the FSF, non-Free software is unethical for "enslaving" the knowledge contained in the software (though I think that position goes a bit too far).
metageek 16y ago
On the other hand, knowing that they're less likely to be sued for patent infringement is probably worth a lot more.
DennisP 16y ago
Most big companies (fortunately) accumulate patents mainly for defensive purposes. If software patents go away, there will no longer be a threat to defend against. So they'll be making the same money, with less legal risk. If the market is silly enough to crash in response to that, I'll hustle out to buy as many shares in the crashed companies as I can.

by tkeller 16y ago

There are some big companies out there with a lot of their on-the-books valuation existing in the form of software patents. If they suddenly have to mark that stuff down to zero, imagine the crash...

deleted 16y ago

[deleted]

olalonde 16y ago

I assume they would have to continue enforcing patents for some years to come, but stop granting new ones.

SwellJoe 16y ago

Only patent trolls would crash, which is almost entirely private equity. Let them crash. In fact, I'd argue that it would be a great good for the market in general to knock the wind out of the parasites who live off of software patent trolling. Microsoft, IBM, Oracle, etc. companies that make money from legitimate sources would be barely effected at all (and many tech companies who have huge patent portfolios have spoken in favor of ending software patents or making them less broad). And, startups could breathe a sigh of relief and stop worrying about being the subject of extortion the day they turn a big enough profit to be a target of patent trolls. Besides, this is about how the USPTO grants software patents. It's not about revoking them or abolishing existing patents, though lawsuits to break some of the more pernicious ones probably would follow.

tkeller 16y ago
This is simply not true. Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books. If the accountants suddenly had to revalue them to $0, it would unquestionably have a big impact on the share price.
- nitrogen 16y ago
  Should that be a consideration when deciding whether to abolish software patents? If nothing else, the USPTO can grandfather the existing patents in, but restrict the ability of their owners to use them aggressively.
  - tkeller 16y ago
    Should it? I don't know. Will it? Absolutely. And what does "aggressively" mean? Making a patent unenforceable will have the same effect as invalidating it.
- SwellJoe 16y ago
  Regardless of how, say Microsoft, uses or doesn't use its patents, they account for a substantial percentage of its value on the books. I'd need to see some evidence of this assertion. When I was spending a lot more time researching tech stocks than I do now (now I spend 0 time researching tech stocks), I never saw a patent portfolio as a significant portion of the value of the companies I was investing in. Revenue and growth is king in tech company stocks. Book value is pretty much considered a big goose egg in software companies because they tend to have so little of it compared to old blue chips that have factories, brick and mortar stores, or infrastructure that has real world value. I'd be absolutely stunned if marking down their entire patent portfolio had more than a 1% impact on their market value, because I suspect even less than 1% of their revenue comes from patents...and revenue and growth is how people value MSFT.

bhiggins 16y ago

There were some folks who owned a lot of slaves back in the day, too. Not a good argument, by itself, sorry.

lukesandberg 16y ago
not really a fair comparison. Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle to the overarching concerns of Justice and Morality. However, as evil as you may think software patents are, they are not on the same level. The USPTO should consider economic ramifications of a decision to stop issuing software patents, or to invalidate patents. I'm not saying they should not go ahead and do it, but it would be irresponsible not to consider any potential negative effects.
- deleted 16y ago
  [deleted]
- metageek 16y ago
  "Obviously in the case of slavery most people would believe that matters of economic stability play second fiddle" -- It wasn't obvious when slavery was legal.
  - lukesandberg 16y ago
    True, that was mostly certainly historical relativism on my part. Maybe in 100 years people will look back on patent lawsuits similarly... but i doubt it
tkeller 16y ago
Seriously? This is your argument? Comparing software patents to slavery trivializes the suffering and evils of slavery.
- nitrogen 16y ago
  Perhaps independent developers feel like prisoners (slaves may be too strong a word) where the wardens are software patents. If you ask the FSF, non-Free software is unethical for "enslaving" the knowledge contained in the software (though I think that position goes a bit too far).

metageek 16y ago

On the other hand, knowing that they're less likely to be sued for patent infringement is probably worth a lot more.

DennisP 16y ago

Most big companies (fortunately) accumulate patents mainly for defensive purposes. If software patents go away, there will no longer be a threat to defend against. So they'll be making the same money, with less legal risk. If the market is silly enough to crash in response to that, I'll hustle out to buy as many shares in the crashed companies as I can.