Patent Wars: Oracle Sues Google And The Wright Brothers Solution

August 19, 2010 - There is a growing movement against patents in general and software and technology patents in particular. The recent move by Oracle to sue Google is a case in point. Mike Masnick at presents background for the prosecution, citing the story of how IBM sued Sun Microsystems for patent infringement long ago. In response to Sun's engineers saying that their patent claims were ridiculous, IBM's lawyers said:

"OK, maybe you don't infringe these seven patents. But we have 10,000 U.S. patents. Do you really want us to go back to Armonk [IBM headquarters in New York] and find seven patents you do infringe? Or do you want to make this easy and just pay us $20 million?"

Sun lost the case, paid IBM and went on to amass an arsenal of patents with which it could defend itself in the future (a typical response to being sued is to countrersue). As Masnick writes in another post, "Sun has been one of the more outspoken companies against abusing the patent system, with former CEO Jonathan Schwartz explaining that real companies innovate, not litigate. However, Sun and its patents are now owned by Oracle, and apparently Larry Ellison feels otherwise."

The argument against patents amounts to this: in a world where there are so many patents it's impossible for even the most diligent and honorable company or individual to create something new that doesn't violate some kind of patent. Consider that there are probably something on the order of 1,000 patents covering the various technologies incorporated into an i-phone - chip design, manufacturing processes, materials, radio technologies, antenna, keyboard, etc. etc. etc. - and you can quickly see why independent inventors and small companies might want to steer clear of innovating in the field of wireless technology.

Eliminate patents, the thinking goes, and innovators will be able to spend more time innovating and less time worrying about possible patent infringement. The argument has merit, especially when patents are interpreted broadly. But throwing out the patent system is not the answer.

At the beginning of the 20th century aviation was the hottest technology in the world. The Wright Brothers were the first to patent methods for controlling an airplane and airplanes literally could not fly unless they incorporated technology claimed in a Wright Brothers patent. The Wrights defended their patents fiercely. Critics at the time said they were hindering advancements in aviation.

By 1917, two major patent holders, the Wright Company and the Curtiss Company, had effectively blocked the building of new airplanes which were desperately needed by the United States in World War I. The U.S. government pressured the members of the aviation industry to form a cross-licensing organization (a Patent pool) under the Manufacturers Aircraft Association.

All aircraft manufacturers were required to join the association and share their patents. Each member was required to pay a comparatively small blanket licensing fee for each airplane manufactured. The fees were shared according to an arrangement worked out by the manufacturers and went primarily to the Wright and Curtiss companies, until their respective patents expired. This arrangement was designed to last only for the duration of the war, but effectively continued beyond it.

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