Monday, August 27, 2012

Protecting Balls

I'm not going to comment directly on the Apple v. Samsung patent lawsuit, mainly because my employer wouldn't like it (and I obviously don't speak for them), but also because the reader would just assume I'm biased.

However, I share the apprehension that many have expressed about patents. Even if you agree that Samsung copied the iPhone and should be stopped, the power of even a single well-placed patent to block an entire class of products is fearsome. If memory serves, over a decade ago, Geoworks had a patent in the WAP browser area, and it propelled the stock from something like US$30 per share all the way to US$180. This is a lot of power.

The solution that many of these patent opponents propose, however, is extreme in the other direction. They want to abolish all patents, or at least all software patents. First of all, very few if any established players are going to support that, and lobbying dollars aside, why should the government ignore some of the country's most successful companies in favor of ranting Internet advocates? Secondly, what would that achieve?

The iPhone was a hugely expensive gamble. There was a mountain of software to develop, and Scott Forstall recalls that Steve Jobs gave him permission to bring in anyone from within the company to work on the iPhone. Forstall then went around and found those he described as "true superstars of the company" and "amazing engineers", and worked them incredibly hard for years. (No, he didn't invite me.) This is no less than betting the company, because stripping every other project in the company of their superstars has an easily-predictable negative effect that I need not belabor, yet they placed that bet.

In other words, to me it's not so much whether there was prior art to pinch-to-zoom or whatever other legal details the poor judge and jury had to slog through, but how to protect the "balls" that goes into a truly innovative product that changed an industry. The point is, even if you didn't think any of the individual distinguishing features of the iPhone were worthy of patent protection, you probably should admit that the total end package redefined smartphones. However trivial you think those inventions were, the fact is that upstart Apple jumped ahead (at considerable risk to itself, let's not forget) technologically, while the rest of the industry rehashed their allegiance to carriers by shipping yet another crippled phone.

Another point that I've seen made is that Apple was handsomely rewarded for its venture, so that should've been enough incentive to innovate. I can't agree with this point of view, true as it may be, because it can be made only in hindsight. Apple couldn't know how much it would make from this phone that it hasn't even fully developed, couldn't know if people would really accept typing on an on-screen keyboard, couldn't know if other carriers could be persuaded to carry the iPhone, and couldn't know a hundred other risk factors. If you still think Apple would've done it anyway in a world without patent protection, consider what would allow another company to leapfrog Apple, without worrying that Apple could easily ape the new invention and crush it with scale? The decision to go for it must be made long before you are assured of wild riches, and a lot of big changes can really only come from big players with lots to lose.

So the question for society is, if not patents (which I'm not really defending here, because there are indeed good reasons to worry that they are too powerful), then what? Is the answer to all future innovation really going to be "Google supporting it with ad revenue" regardless of whether it ever makes its own money? I hope not, because I don't really like that world.