4 ms·
I imagine a lot of patent trolls (e.g. Intellectual Ventures) just read this headline and interpreted it as: Patent sector profits rise to half a trillion.
by rkalla 15y ago
I imagine a lot of patent trolls (e.g. Intellectual Ventures) just read this headline and interpreted it as:
Patent sector profits rise to half a trillion.
The This American Life piece on patent trolls[1] (Which I am sure a lot of you listened to) was certainly eye opening, but one take-away was the huge investments that companies like IV have coming in from 3rd parties that expect serious returns.
From what I would tell, IV operates a lot like an insurance company.
They hoard 10s of thousands of patents which they enforce through 1 of 1300 subsidiary companies and larger companies like Microsoft, Samsung, HTC, etc. can pay a monthly or yearly membership fee to IV in order to "lessen the chance of being sued by IV or one of the child companies".
Of course it is cheaper for all of them to pay their membership fees and IV enforces this behavior by violently attacking anyone that decides they don't want to pay up.
There is an implied threat[2] to not playing along.
(this isn't me postulating, the "When Patents Attack" piece covers this).
In turn, investors step in and invest billions into IV to get a cut of the growing patent market, like I might invest in a fund.
I understand financial and legal systems are complex, but what IV has created seems to me to be this dystopian-esque octopus of circular self-leveraging that is designed to be impossible to untangle.
[1] http://www.thisamericanlife.org/radio-archives/episode/441/when-patents-attack http://www.thisamericanlife.org/radio-archives/episode/441/w...
[2] http://en.wikipedia.org/wiki/Extortion http://en.wikipedia.org/wiki/Extortion
- binarybits 15y agoIf you read my article, you'll see that's not what the study finds. They estimate that less than 10 percent of the wealth lost by defendants goes to patent trolls. The rest is destroyed.
- rkalla 15y agoBB, sorry for the confusion, I was using your post as an opportunity to stand up on my soap box. I didn't mean to put words in your mouth.
- fleitz 15y agoWho knew that using other people's inventions with out paying them could result in a loss of share value. If you dig into the dataset you can see that patent trolling drastically increased after 2005, given the stock market trends over that period it's not surprising that companies would lose a lot of value after a litigation event in a market defined by lack of confidence. Also, as the case progresses the market will price back in the EV of the litigation, how do they account for that? A lawsuit is big news, a technical maneuver in court that absolves a lot of liability may not because of the complexities involved.
- noonespecial 15y agoSome people are willing to steal money directly. A dollar lost is a dollar gained. They make me mad. There is quite another type, alive and well in our political and legal system, that have no problem stealing or ruining thousands for a few dollars gain for themselves. I well and truly wish these folks hadn't been born. I feel as soon as humanity grows out of the stage where this kind of behavior is tolerated, we'll be well on our way to the utopia that most of us hope for. Once you nip this impulse in the bud, it won't matter if the systems are socialist, capitalist or whatever, they'll probably work just dandy. This is why we can't have nice things.
- praptak 15y ago"From what I would tell, IV operates a lot like an insurance company." An insurance company that insures against its own actions is usually called other names.