Innovation Comes To Backyard Grills… After The Patent Expires
from the funny-how-that-works dept
If you look through the history of economic innovation (at least over the last few hundred years), you notice a pattern: for all the talk about how patents are required for innovation, true innovation only seems to occur after key patents expire. The history of the steam engine is quite instructive on this, but it’s true of many other inventions as well. For Memorial Day this past weekend, the Associated Press ran an article all about the sudden rise in popularity of infrared grills for home use. Despite the technology first being invented in the 60s (for drying paint on cars), it was a very limited market until the key patent expired in 2000 and real innovation could occur that would allow such grills to be produced economically for backyard use. Chances are the market is a hell of a lot bigger today than it was before the patent expired. However, there’s an even bigger point hidden towards the end of the article. The traditional patent defenders always claim that without a patent, the original inventor will simply get left behind. However, that’s not at all what happened here. Char-Broil, makers of popular backyard grills could have gone out on its own and produced their infrared cookers without the help of Thermal Electric Corp., who held the patent. However, knowing that Thermal Electric Corp. understood the technology better than anyone else, they still formed a strategic alliance with them for the production of Char-Broil’s grills. In other words, the patent slowed down the production of backyard grills in the space, which have only enlarged the market. At the same time, the loss of the patent hasn’t destroyed Thermal Electric’s ability to profit. Far from it: it’s opened up new opportunities for it.
Comments on “Innovation Comes To Backyard Grills… After The Patent Expires”
Use case scenereo
I’ve been hypothesizing about this for a while– if a product with core IP never becomes successful after the IP expires as a result of inability or unwilling to license the IP.
Interesting example of how current patent system has no incentive to license… Which could innovate expand upon the idea…
Another good example of IP failure
People who believe IP law actually has a useful purpose are just like people who have blind faith in the Bible. They listen to experts and believe what they are told regardless of the evidence that faces them.
IP law in the form it exists nowadays did not exist for thousands of years of human innovation. What honestly makes people think that it is suddenly now so neccesary?
With a world growing as fast as it is does IP law have any real place in our future? Will we continue to allow a minority of people to own ideas and concepts so that they can control the way innovation happens?
IP law along with majority of businesses that exist are already obselete. When will our coveted market economy force them to change? Or do they have such a stranglehold on everything that they can continue to bully us into buying into their broken systems?
I guess the future will hold the answers.
Re: Another good example of IP failure
reed,
Come on now, to bring the Bible and religion into this discussion illustrates some very obvious bias. Please leave this out of your discussion and stick to some more appropriate illustrations.
ben
Substitutes
Mike, I agree with a lot of what you say, but your analysis is incomplete.
First, you don’t talk about how the existence of a patent on a technology influences innovations in the substitute market. A patent on a technology is not a monopoly per se if there are substitutes that compete with that technology.
Next, I’m not convinced that the expiry of the patent was the but for cause of innovation in that space. If consumers enjoy the use of infrared grills so much, why didn’t the patent holder introduce a consumer version? Perhaps they just missed a market opportunity, but it could be that the technology’s sub-components have gotten cheaper.
Re: Substitutes
First, you don’t talk about how the existence of a patent on a technology influences innovations in the substitute market. A patent on a technology is not a monopoly per se if there are substitutes that compete with that technology.
Unfortunately, with so many patents being written so broadly these days, it pretty much wipes out the substitute market in many cases.
Next, I’m not convinced that the expiry of the patent was the but for cause of innovation in that space. If consumers enjoy the use of infrared grills so much, why didn’t the patent holder introduce a consumer version? Perhaps they just missed a market opportunity, but it could be that the technology’s sub-components have gotten cheaper.
It seems pretty clear from the article that the other companies were waiting for the patent to expire before even exploring the market. It’s true that the original company simply missed the market, but that’s because they could sit fat and happy with their monopoly.
Another sensationalist title
Care to elaborate on how innovation of ceramic-burner grills has “taken off” now that the patent has run up?
Oh, by “innovation” you really mean “other companies started making the same thing, except worse in quality but cheaper, so it is becoming more popular in the consumer market” ?
Perhaps you have lost yourself in your own FUD and forgot what innovation even means?
Re: Another sensationalist title
Hi Paul,
Always nice to hear from you!
Care to elaborate on how innovation of ceramic-burner grills has “taken off” now that the patent has run up?
Paul, the underlined portion of my post is a “link.” If you click on it, you can read the article on which I based my post. In that article, you’ll see the following: “But original infrared burners — and some offered currently to consumers — contained ceramic material that was hard to clean, prone to flare-ups and fragile…. The fragile ceramics have been eliminated. There’s a layer of glass to shield the burners from drippings and provide even heat distribution….”
Oh, by “innovation” you really mean “other companies started making the same thing, except worse in quality but cheaper, so it is becoming more popular in the consumer market” ?
Nope, but why bother with the facts when you enjoy coming here and simply attacking me with nothing to back up your attacks?
Perhaps you have lost yourself in your own FUD and forgot what innovation even means?
Actually, I think you are confused about what innovation means. As we’ve detailed repeatedly, innovation is the process of taking something new and getting it to market successfully… So even if you *had* been right originally (which you weren’t) having other companies get the product to the consumer market absolutely is innovation.
Or do you not consider the Model T innovation? After all, that was simply a copy of other automobiles, except cheaper.
Paul...
I think I can take that one on…
Cheap copycats serve a fairly useful purpose in our market. They provide a cheaper version of a product, affordable for the less wealthy. this has a couple very stimulating effects:
a) increases awareness to public of a new technology. This causes more and more competition in the market, and drives prices down further. existing manufacturers are forced to innovate in order to keep up, either by improving the technology, or finding a cheaper way to manufacture.
b) increases awareness among VC. This increases the chances of a startup which has new ideas getting the VC they need. VC’s are not likely to invest in an idea which does not appear to be in demand, no matter how brilliant the idea may be.
Actually I read this in the paper and found it interesting, from the sound of it there’s more to it than that. Basically it sounds like Char Broil made a deal with Thermal Electric which allowed them access to TE’s technology, and I suspect make some money off of it while insuring that they’d have a leg up on the competition when the patent wore off as they’d helped design the new technology (basically TE’s paint drying system redesigned for grilling). Actually a pretty neat little bit of maneuvering, it allowed someone else to pick up the costs of putting the product out on the market, while getting them a head start on the competition.
Other examples
Consider the Dolby noise-reduction technology commonly used on the old audiocassettes. Apparently the patents had already expired, but manufacturers continued to pay licence fees to Dolby for the right to use the double-D symbol, because it was something consumers had grown to expect.
Another example is the Otto four-stroke cycle as used in your common-or-garden petrol combustion engine. While the patent for that was still in effect, rivals expended great ingenuity coming up with alternative systems (like the Atkinson cycle). After the patent expired, everybody adopted the Otto cycle, and thereafter mostly concentrated on refinements to it, rather than development of radically different systems.
Not really
Your false premise is that patents exist merely or principally to increase the widespread adoption of technological advances. Let’s call that a “social utility” theory of patents, and it’s a theory that flips the Constitutional concept of individual rights on its ear.
Patents perform one primary and essential function: to protect the patent holder’s ability to gain benefit from his inventions. It’s true that patents thus create an environment wherein inventions are rewarded, thus resulting in a greater number of inventions (and, that’s not actually a mere byproduct, since a society that protects individual rights is necessarily a better society to live in).
By your argument, however, an inventor shouldn’t benefit from his invention, or if he does so, it should be by some other standard than his own. “Just think how many infrared grills we might have enjoyed all these years, if only that darn patent hadn’t gotten in the way,” you might say. That’s wrong on a number of levels, however.
First, I don’t think you’re arguing that an individual inventor should be sacrificed for a larger outdoor infrared grill market (the essental issue). While that’s the natural result of your argument, I don’t think it’s intentional. Rather, I think you mean that without patents, the market for something would be bigger overall, and thus the inventor _and everyone else_ would benefit. That’s mere sophistry, however, relying on a number of unprovable and unproven assumptions, and it evades the essential point. You’re making the argument that, essentially, the inventor should willingly accept having his efforts appropriated because he’ll probably end up making more money anyways. This is neither _necessarily_ true (which is enough to invalidate it) nor is it up to you or anyone else but the inventor to decide.
Second, in a single possibility out of many, perhaps the market for inexpensive infrared grills was smaller because of the patent, but maybe the market for other types of grills was larger and more innovative in response (and this is a non-essential issue). Certainly, to the extent that others could have come up with non-infringing methods for utilizing infrared in grills, they would have done so had a market existed for them–which it didn’t, because there were plenty of other, less costly and acceptable substitutes. That’s not meaningful, however. The point is that patents are _supposed to_ grant monopolies, to ensure that the inventor benefits. Otherwise the concept of patents would be meaningless.
And then, finally, you’re missing an important aspect of patents that bears directly on your central argument in this post. Because patents are public, the rest of the world has time and opportunity to evaluate a patent and plan for its eventual expiration. _Of course_ a market becomes larger once a patent expires: other producers have had 17 years to create and then, ultimately, manufacturer and sell their own products based on the once-patented works. That’s what makes a patent different in practice from a trade secret, which by definition is _not_ in the public sphere and therefore can theoretically be protected forever.
The second half of your argument isn’t so clear. In particular, this sentence was confusing: “In other words, the patent slowed down the production of backyard grills in the space, which have only enlarged the market.” I think you’re saying that, even in spite of the patent’s expiration, Char-Broil still partnered with Thermal Electric Co. to create new grills. That’s not relevant to the discussion of patents, however; it’s simply an example of normal business decision-making. Remember that anyone is free to request that a patent holder license his protected material. The only question is whether, in the context of the patent, such licensing would be economical for either party. Once the patent expires and the patent holder has less leverage, certainly it might become economical to partner with other firms.
Where you say “the original inventor [isn’t] left behind,” it sounds like you’re just throwing the dog a bone. Again, it’s not up to you or anyone else to decide how an inventor benefits from his efforts in inventing. Arguments that an inventor would be well enough off if only he followed your advice–and thus he should be forced to do so, by the failure to protect his rights–is the kind of thinking that leads to the gulag.
Re: Not really
Your false premise is that patents exist merely or principally to increase the widespread adoption of technological advances. Let’s call that a “social utility” theory of patents, and it’s a theory that flips the Constitutional concept of individual rights on its ear.
Um. No.
“Congress shall have power… to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”
The Constitution makes it clear that the sole purpose of patents is social utility. Individual rights have nothing to do with patents.
Patents perform one primary and essential function: to protect the patent holder’s ability to gain benefit from his inventions.
This is wrong on a variety of levels. First, patents are not there to protect the patent holder’s ability to gain benefit. That’s simply wrong. The purpose is solely to benefit society — and if society is not benefited, then the patents are unconstitutional.
It’s true that patents thus create an environment wherein inventions are rewarded, thus resulting in a greater number of inventions (and, that’s not actually a mere byproduct, since a society that protects individual rights is necessarily a better society to live in).
You make this statement as if it’s fact, but it shows an ignorance of history and technology. Innovation is an ongoing process, and locking up each step of innovation slows down that innovation. Take a look at the history of the steam engine or flight as examples. Patents *slow down* innovation, rather than speed it up.
It would speed it up if the process of innovation was a “bright flash” of inspiration. But it’s not. It’s an ongoing process built on the backs of everyone before.
By your argument, however, an inventor shouldn’t benefit from his invention, or if he does so, it should be by some other standard than his own.
Not at all. Not at all. An inventor should benefit from his invention — just not by patent, which holds back other innovations. The point is that there are numerous ways to profit from innovation, and a patent is only one method — and not a very good one. Bringing products to market in a way that serves market demand is a pretty damn good way to profit from an invention, and it doesn’t require a patent.
You’re making the argument that, essentially, the inventor should willingly accept having his efforts appropriated because he’ll probably end up making more money anyways. This is neither _necessarily_ true (which is enough to invalidate it) nor is it up to you or anyone else but the inventor to decide.
Actually, it’s you that has it backwards. Why is it up to you or anyone else to decide that EVERYONE ELSE must suffer through slower growth and innovation just to provide welfare to one person? Sorry, I don’t think that’s a very good system and neither should you.
That’s not meaningful, however. The point is that patents are _supposed to_ grant monopolies, to ensure that the inventor benefits. Otherwise the concept of patents would be meaningless.
Again, you don’t seem to understand the purpose of patents. I point you back to the Constitution. It’s not to ensure the inventor benefits. It’s to ensure society benefits.
_Of course_ a market becomes larger once a patent expires
So you admit that it’s market shrinking in the meantime? Doesn’t that go against the Constitutional purpose of promoting innovation?
Again, it’s not up to you or anyone else to decide how an inventor benefits from his efforts in inventing. Arguments that an inventor would be well enough off if only he followed your advice–and thus he should be forced to do so, by the failure to protect his rights–is the kind of thinking that leads to the gulag.
Wow. The gulag? For suggesting that we actually let the market set the rewards rather than the gov’t? I’m not saying get rid of anyone’s rights. Bizarre. I’m saying that the gov’t shouldn’t be in the business of limiting innovation and we should let the market work. I’m not *FORCING* anything. I’m saying GET RID of the GOVERNMENT creating protectionism that harms everyone.
Re: Not really
“I think you’re saying that, even in spite of the patent’s expiration, Char-Broil still partnered with Thermal Electric Co. to create new grills. That’s not relevant to the discussion of patents, however; it’s simply an example of normal business decision-making.”
I am not sure where Mike was heading with this line of thought, but I was thinking it highlights the reality of technological innovation. Sure the patent had expired but because of their expertise with the technology companies still choose to work with them. This is because they actually have value that surpasses merely owning a patent. They have developed and kept it fresh and thats why they are still in the game.
On the other hand many companies don’t stay in the game and instead use patents to extort money that they do not deserve. The bottom line in my mind is if you continue to run with an idea patents are basically useless as this examples points out. The value is your accrued knowledge and expertise in a area something that a patent has little to do with.
So patents are basically worthless in my mind as anyone who takes the time to continue to develop an idea will likely stay far ahead of any competition regardless of patents or other IP protections.
Insentive for innovation
I believe that to some extent patents that are legitimate (ie not one click shopping or the wheel) could be of benifit in giving specific and exact details of the workings of a product to others. This should save effort towards reverse-engineering by others and effort to prevent this reverse engineering by the original creator which could be better spent on making the product better(kinda like the effort spent on DRM but that’s another point).
There are 2 problems with patents currently with this:1. the poor quality of these patents means that often they don’t reveal enough information to be useful or the information is unnecessary – for example how much information do you need to implement 1-click-shopping? 2. The patent period is so long that someone who just sits on their patent does real harm by stopping innovation from occurring and doesn’t provide incentive for the patent holder to act with any speed.
Basically a period of the patent needs to be long enough that the original creator has incentive to disclose details and the patent must only be granted when the details are significantly new, innovative and informative. This has to be balanced by the period being short enough that the details can be productively used as soon as possible and that the patent holder has incentive to rapidly innovate in order to gain as much a head start on the competition as possible or the patent is useless.
Re: Insentive for innovation
Woops, forgot to put my name on it!
And perhaps something along the lines of “Incentive for Disclosure” would have been a more accurate title.
Basically in summary my idea is that patents should not be seen as a method to provide incentive for innovation, because as Mike has correctly stated the market already provides the incentive – ie money for selling products that people want – but instead patents should be used to increase the efficiency of the market by reducing unproductive effort such as duplication of work.
Not Really
Your argument has nothing to do with the Constitution, and so I’m surprised that you bring it up. Now that you have, however, let’s consider that clause:
1. “…to promote the progress of science and useful arts…” What in this is pertaining to “social utility”? In fact, it says nothing about for whom such progress is valuable, and you’ll need to come up with more than that to show that the Founders were concerned with the “good of society” rather than the rights of the individual. Really, that’s a rather bizarre understanding of the Founders’ position. I recommend that you read the Declaration of Independence if you want a better understanding of their position regarding the individual, and about government’s purpose.
2. “…securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries…” However, regardless of whom the Founders were concerned with, this clause makes it clear that they supported the overt recognition of the individual’s right to control their intellectual property. They obviously recognized that it was only by securing individual rights that science and the arts would progress.
And please don’t play semantic games: the Founders believed that a society within which the individual is protected is the proper sort of society _for the individual_. No one is arguing that we don’t live in a society–of course we do, and that’s a good thing. Living alone on an island would be a brutal existence, a constant struggle. Living in a proper society means that we can produce value and trade it freely, making our lives far easier and happier, and certainly we benefit as individuals from an environment where science and art progess. The Founders weren’t socialists.
Nevertheless, again, I find it fascinating that you quote the Constitution when your position is that its provisions should be abandoned. Since that’s your position, we’re really not arguing Constitutional interpretation, but rather more general concepts of right and wrong. And where you say “…if society is not benefited, then the patents are unconstitutional” is nonsense. No valid interpretation of the patents and copyrighs clause can result in that position; there’s simply nothing there to support it.
I also don’t find your argument about innovation, in general, to be meaningful. You say, “Innovation is an ongoing process, and locking up each step of innovation slows down that innovation.” That’s a bit circular, don’t you think? “…locking up each step of innovation slows down _that_ innovation”? (emphasis mine) Say again?
Innovation is certainly a process, but it’s a process that results in particular discernable innovations–not some nebulous, undefinable future utopian state. Your position that the protection of a single innovation (or, any number of them) slows down overall “innovation” is a curious one. You’re essentially saying that there’s some unknown end result of “innovation” that is hampered by protecting one or a number of other “innovations.” This is impossible to know in advance, of course, and once again you’re making the assumption that without protection, people will continue to invent. You say that there are “numerous ways to profit from an invention,” but you don’t say what those ways are–at least, not for the individual inventor himself.
You do make an important point, that inventions build on “the backs of everyone before.” That’s why patents (and copyrights) don’t continue in perpetuity–it would become impossible for anyone to afford anything, ever, if a patent could be handed down forever. Imagine how expensive a car would be if we were still paying _someone_ (and not the original inventor) for the discovery and subsequent improvements of the wheel. Again, the notion is to protect the rights of the individual inventor, so that he can benefit fully from his efforts in creating an invention.
The rest of your response is common collectivist dogma. I’m not saying that “everyone else must suffer through slower growth and innovation just to provide welfare to one person.” I’m saying that every individual has the right to benefit from his own actions, and that someone else’s needs or desires doesn’t create a claim on the individual. I don’t _believe_ that “everyone else” suffers when the individual is protected, simply because I don’t believe that there’s some entity called “everyone else” that _could_ suffer. “Everyone else” is comprised of individuals, and a society that protects the individual thus protects everyone at the same time.
You’re taking the position that protecting the interests of the individual harms “society,” and that “society” is a higher value than the individual. That’s precisely the philosophy that led to the deaths of 100 million people in the 20th century. How can you be so shocked, then, that I mention the gulag, which was the direct result of your sort of collectivist philosophy?
Re: Not Really
Your argument has nothing to do with the Constitution, and so I’m surprised that you bring it up. Now that you have, however, let’s consider that clause:
Wow. My whole argument is based very much on the Constitution.
1. “…to promote the progress of science and useful arts…” What in this is pertaining to “social utility”?
Um. If you don’t see promote the progress of science and useful arts as social utility than we simply are speaking a different language.
In fact, it says nothing about for whom such progress is valuable, and you’ll need to come up with more than that to show that the Founders were concerned with the “good of society” rather than the rights of the individual. Really, that’s a rather bizarre understanding of the Founders’ position. I recommend that you read the Declaration of Independence if you want a better understanding of their position regarding the individual, and about government’s purpose.
No. I suggest you do a little research yourself… specifically go read the letters between Jefferson and Madison when they debate this very clause. They were very much concerned about the social benefit — and Jefferson in particular was worried about the negative impacts of monopoly rights, which Madison agreed was a problem. In the end they backed down on this very reluctantly. It was very much about the social good (and potential harm) and had nothing to do with property rights.
You simply have your history wrong.
However, regardless of whom the Founders were concerned with, this clause makes it clear that they supported the overt recognition of the individual’s right to control their intellectual property.
FOR THE PURPOSE OF PROMOTING THE SOCIAL GOOD. It was not for the sake of property rights. You’re simply wrong.
They obviously recognized that it was only by securing individual rights that science and the arts would progress.
No. That’s also wrong. The problem here is your use of “only.” In fact Jefferson was quite clear on this, noting that there are other means to promote science and useful arts, but recognizing that limited time monopolies *could be* a necessary evil. However, if it were shown (as research has done) that the social benefit is worse with monopolies than without, then such monopolies should be removed.
And please don’t play semantic games: the Founders believed that a society within which the individual is protected is the proper sort of society _for the individual_.
No. Again, you are confused. The founders believed that within individual rights, all of society benefited — which is accurate. However, you seem to be confused into believing that gov’t granted monopolies are individual rights — when they’re not. They’re barriers to individual rights.
The Founders weren’t socialists.
Who claimed that they were? Not I.
Nevertheless, again, I find it fascinating that you quote the Constitution when your position is that its provisions should be abandoned.
No, I point out that the Constitution makes it clear that the ONLY REASON to grant monopolies are “for the progress of science and the useful arts.” If those monopolies do NOT promote the progress of science and the useful arts then clearly, they are unconstitutional.
No valid interpretation of the patents and copyrighs clause can result in that position; there’s simply nothing there to support it.
Other than, you know, reading the actual clause and the debate that went into it. The purpose of monopolies are clear: “to promote the progress of science and the useful arts.” If the monopoly does not do that, then it’s clearly unconstitutional. I don’t see how you could read it another way.
Your position that the protection of a single innovation (or, any number of them) slows down overall “innovation” is a curious one. You’re essentially saying that there’s some unknown end result of “innovation” that is hampered by protecting one or a number of other “innovations.” This is impossible to know in advance, of course, and once again you’re making the assumption that without protection, people will continue to invent. You say that there are “numerous ways to profit from an invention,” but you don’t say what those ways are–at least, not for the individual inventor himself.
No. I say that the ENTIRE process is hampered by locking up each individual input. This is supported by historical research.
As for the ways to profit from an invention, I have discussed them at length. Your inability to find them doesn’t mean I haven’t. I will, however, suggest the simplest method: selling a product in the market.
The rest of your response is common collectivist dogma.
Say what? It’s simple free market economics I’m discussing here.
I’m saying that every individual has the right to benefit from his own actions
Right. We agree. What did I say that makes you think I don’t think every individual has the right to benefit from his own actions? All I’m saying is that said benefit should come without gov’t monopolies.
You’re taking the position that protecting the interests of the individual harms “society,” and that “society” is a higher value than the individual.
No. Not at all. I’m saying that EVERYONE, including the INVENTOR benefits from a market based economy, rather than a protectionist one.
You seem to be under the false impression that my position means that an inventor gets screwed for the benefit of society. Not at all. What I’m saying is that by getting rid of monopolies and protectionism, it opens up more opportunities for the inventor.
Re: Not Really
1. “…to promote the progress of science and useful arts…” What in this is pertaining to “social utility”? In fact, it says nothing about for whom such progress is valuable, and you’ll need to come up with more than that to show that the Founders were concerned with the “good of society” rather than the rights of the individual. Really, that’s a rather bizarre understanding of the Founders’ position. I recommend that you read the Declaration of Independence if you want a better understanding of their position regarding the individual, and about government’s purpose.
I find this point very bizarre and quite frankly, argumentative. What on earth were the authors of the Constitution concerned with if not the good of society? What on earth is the point of protecting certain individual rights if protecting those rights doesn’t, in the long run, benefit society? Also I think one will note, on reading the Declaration that they were specific in listing certain individual rights, “life, liberty, and the pursuit of happiness” if I recall correctly. But that does not include the “right” to a guaranteed benefit from making things. IP law is a government-backed limited monopoly pretty clearly intended as incentive for people to make more things and thus enrich society overall. I think that the promotion of the progress of science and useful arts is pretty clearly intended to benefit everyone, and not just one person.
2. “…securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries…” However, regardless of whom the Founders were concerned with, this clause makes it clear that they supported the overt recognition of the individual’s right to control their intellectual property. They obviously recognized that it was only by securing individual rights that science and the arts would progress.
Yes, the constitution recognizes certain limited rights of creators to their creations, and YES the constitution certainly makes it seem that the founders believed that securing these rights would give incentives for people to create, and thus progress in arts and science. Mike is not debating that this is what the constitution says, for what else is the point of patents and other ip? He is instead arguing that, gasp, the founders were mistaken and ip protection is not necessary for innovation, and actually stifles it. For which there is plenty of evidence.
And please don’t play semantic games: the Founders believed that a society within which the individual is protected is the proper sort of society _for the individual_. No one is arguing that we don’t live in a society–of course we do, and that’s a good thing. Living alone on an island would be a brutal existence, a constant struggle. Living in a proper society means that we can produce value and trade it freely, making our lives far easier and happier, and certainly we benefit as individuals from an environment where science and art progess. The Founders weren’t socialists.
Mike never said this. With whom are you arguing? But, there is a difference between protecting individual rights where the protection of those rights benefits society overall, and the protection of those rights to the great detriment of the rest of society. And I think you will find it hard to argue that the authors of the constitution believed in protecting individual rights to the detriment of society.
Nevertheless, again, I find it fascinating that you quote the Constitution when your position is that its provisions should be abandoned. Since that’s your position, we’re really not arguing Constitutional interpretation, but rather more general concepts of right and wrong. And where you say “…if society is not benefited, then the patents are unconstitutional” is nonsense. No valid interpretation of the patents and copyrighs clause can result in that position; there’s simply nothing there to support it.
Well, if one is arguing that the constitution should be changed, I would hope he or she would know enough about it to quote the part of it he or she believes to be wrong. I find it fascinating that you think someone cannot quote the constitution except in support of the constitution. Aside from that, Mike was not quoting it in that manner, but rather as support that the intention of patents is to provide incentive for innovation. Assuming that the purpose as written in the constitution of ip protection is to benefit society, then Mike is quite correct in asserting that ip protection that does NOT benefit society is unconstitutional by definition. I agree and I think the wording of the constitution supports this position.
I also don’t find your argument about innovation, in general, to be meaningful. You say, “Innovation is an ongoing process, and locking up each step of innovation slows down that innovation.” That’s a bit circular, don’t you think? “…locking up each step of innovation slows down _that_ innovation”? (emphasis mine) Say again?
As above, I think you’re being a bit argumentative. Innovation is not an object or a goal. Mike is quite correct when he calls it a process, and a process can be slowed – even considerably – and simultaneously be occuring. I don’t see anything circular in that.
Innovation is certainly a process, but it’s a process that results in particular discernable innovations–not some nebulous, undefinable future utopian state. Your position that the protection of a single innovation (or, any number of them) slows down overall “innovation” is a curious one. You’re essentially saying that there’s some unknown end result of “innovation” that is hampered by protecting one or a number of other “innovations.”
Quite frankly, this is not true. Innovation isn’t discrete, and doesn’t really result in discernable concrete objects. The process of innovation brings about goods or services which are brought to market, and thus for a time may seem like a “single innovation” but that good or service is not the end product of innovation. Innovation continues, improvements are made, new goods/services are brought to market, and the old ones put aside. Furthermore, Mike has never said that there is an end product of innovation (in fact, the assertion of some end product of innovation is closer to what you said). Innovation itself is harmed when artificial protections are enacted. And innovation itself is the point of innovation – a constant striving to make things better.
This is impossible to know in advance, of course, and once again you’re making the assumption that without protection, people will continue to invent. You say that there are “numerous ways to profit from an invention,” but you don’t say what those ways are–at least, not for the individual inventor himself.
History itself provides plenty of evidence that innovation not only continues, but thrives, without artificial protections. And again you assume that just because someone makes something or has an idea, that that person has a right to benefit from it. But no such right exists, there is only the hope of being able to benefit, and that is still enough.
You do make an important point, that inventions build on “the backs of everyone before.” That’s why patents (and copyrights) don’t continue in perpetuity–it would become impossible for anyone to afford anything, ever, if a patent could be handed down forever. Imagine how expensive a car would be if we were still paying _someone_ (and not the original inventor) for the discovery and subsequent improvements of the wheel. Again, the notion is to protect the rights of the individual inventor, so that he can benefit fully from his efforts in creating an invention.
Again, you make the false assumption that an inventor has a right to benefit from an invention. This is just not so. An inventor has the same right as everyone else and that is to TRY to benefit from efforts. You are however, right that no one creates in a vacuum, and that is precisely the problem with ip protections.
The rest of your response is common collectivist dogma.
Again, you’re being argumentative, and unduly dismissive. Mike is hardly collectivist. He does, however, frequently make compelling arguments that ip is not property and should not be treated as such.
I’m not saying that “everyone else must suffer through slower growth and innovation just to provide welfare to one person.” I’m saying that every individual has the right to benefit from his own actions, and that someone else’s needs or desires doesn’t create a claim on the individual.
Again, this “right of benefit” you keep referring to is an illusion. There is no such thing. And others’ needs and desires constantly create claims on individuals. Anyone who has had a sibling, a child, a spouse, or a friend can tell you that. I realize that this is not the same sort of thing you are claiming, but it is true nonetheless.
I don’t _believe_ that “everyone else” suffers when the individual is protected, simply because I don’t believe that there’s some entity called “everyone else” that _could_ suffer. “Everyone else” is comprised of individuals, and a society that protects the individual thus protects everyone at the same time.
“Everyone else” is an entity that is comprised of all human beings except the one to whom one is referring. Protecting the rights of specific individuals can quite clearly harm “everyone else” and in fact can infringe on the rights of the individuals who make up that entity. This is well illustrated throughout human history. I would even argue the opposite and say that whatever benefit a person may derive from the granting of specific intellectual property is dwarfed by the potential benefit they lose by the granting of ip rights in general.
You’re taking the position that protecting the interests of the individual harms “society,” and that “society” is a higher value than the individual. That’s precisely the philosophy that led to the deaths of 100 million people in the 20th century. How can you be so shocked, then, that I mention the gulag, which was the direct result of your sort of collectivist philosophy?
This is again argumentative, and far too emotional. Mike is not taking that position at all, you are taking this to the extreme example. One could do the same with your argument and say that you are advocating intellectual authoritarianism by granting a specific individual the right to say what others can and cannot do. However, I won’t go that far, but will instead sum up by saying that the purpose of government (and I believe the intention of the authors of the constitution) is to balance the rights of the individual with the rights of the whole. And I think the argument Mike is making is that just because one person’s idea is used by others, it does not mean that that person cannot benefit. There is benefit to go around.
All the best,
Emi
Re: Re: Not Really
Emi,
Great response. Thanks!
Mike
Infra-Ray Broilers
When I rented a house in the mid-80’s it had
a gas range made by Caloric (a Raytheon company)
with the Infra-ray broiler. It was excellent.
Eventually I bought my own home and I did buy
of those Caloric gas ranges and I have never
regretted it. I convinced a few friends to
buy them too and they are also pleased.
Sadly I think Caloric is no more but it’s good
to hear that the technology is still available
even if it’s in a grill.
Re: Infra-Ray Broilers
the Caloric gas infrared broiler turned out steaks with a restaurant taste … there was one in my parents house … i ve been looking for one for more than five years now …
Char-Broil/Thermal Electric
Feels like some circular logic you’re using there, Mike. Does Char-Broil consider Thermal Electric a “subject matter expert” in infrared cooking because they invented it(as proven by the patent), or in spite of the fact? Yes, the patent has expired, but having the patent allowed Thermal Electric exclusive rights (or, at least control who had rights) within that space to work while it was active, extending their “subject matter expertise.” We have reached the “age of sourcing” in manufacturing products, where companies tend to look outside for expertise rather than trying to develop new technologies inside. It is no surprise to me that Char-Broil would look outside for help with a new cooking technology. Are you saying that, without the patent, you can personally guarantee that they would have chosen Thermal Electric as their partner, and not some other company who could have just copied their technology 27 years ago (including, perhaps, even Char-Broil?)? What tells you that? Or, to put it another way, if you are claiming that Thermal Electric holding the patent stifled innovation, that implies that others would have innovated more, or at least differently…wouldn’t that have likely muddied Thermal Electric’s status as “king of infrared cooking” and perhaps had Char-Broil looking elsewhere for a partner (assuming they didn’t develop it in-house in the ’80s, when companies still developed new technologies in-house)…?
Not Really
To get the argument (and come on, it _is_ an argument) back on track, consider these two scenarious:
1. With patents: You spend 10 years of your life inventing something that meets some unmet need. You spend all of your free money and time on this invention, and finally perfect it. You submit a patent application, and it’s accepted. In doing so, you’ve placed the specifics of your invention in the public sphere, which is okay with you because now you can freely go to manufacturers and sell them licenses to make your product. You don’t have to worry that your invention will be merely stolen by one of the firms to which you expose it. You sign contracts with them, they manufacture your invention, and you receive the royalty checks. Your efforts have been rewarded, and you and others have an incentive to create other inventions.
At the same time, perhaps you identified a valid need, but your particular invention isn’t the best possible way to accomodate it. So, some other bright inventor, or some huge multinational corporation with tremendous resources, it makes no difference, reviews your patent and develops a different method for meeting the need. They submit their own patent, it’s accepted, and they manufacturer their own product. That’s fine, because they didn’t infringe on your invention, i.e., they didn’t steal your intellectual property. Rather, they created their own invention, their own “innovation,” if you will, and thus science was truly advanced. The mere fact that you aren’t gaining the return on your investment that you hoped for isn’t relevant; you don’t have an intrinsic right to such a return itself, but rather only to control your property and to sell it to whomever wants to buy it.
2. Without patents: You spend 10 years of your life inventing something that meets some unmet need. You spend all of your free money and time on this invention, and finally perfect it. You get loans to cover the engineering costs of devising a manufacturing process, the costs of acquiring an initial run of raw materials, labor costs, etc., and you start manufacturing your invention. Some other established manufacturer buys your product, reverse engineers it, and leverages their economies of scale in manufacturing facilities, raw materials acquisition, labor, etc., and starts selling your invention at a fraction of your costs. They drive you out of business, and you end up bankrupt and destitute.
At the same time, nobody creates a substitute, because it’s cheaper to just duplicate your invention. Your invention wasn’t the best possible, but who cares? It’s good enough. If anyone else does create a substitute, it’s a random occurance, and not all markets can support a meaningful number of substitutes.
Your only other alternative would be to keep some aspect of your invention (or manufacturing process, whatever) as a trade secret. You’re able to keep the specifics hidden, and you and your heirs (or some other entity who buys your business after you die) also manages to keep them hidden. Your invention is produced into infinity, and nobody ever learns the secret. Thus, some other invention that would have otherwise been possible never materializes, and science is _not_ advanced.
Ultimately, I find the notion simply fascinating that patents and copyrights hamper innovation, when they are the only thing that _requires_ others to create original works. If you want to compete against someone with a patent, you’re necessarily required to create your own invention that doesn’t infringe.
The same with copyright: if you want to compete against a writer, musician, or artist with copyrighted material, you’re necessarily required to create your own original works. Otherwise, your work would be merely derivative. Consider genres such as hip hop: is it really “innovative” to take someone else work and remix it? Wouldnt it be far more “innovative” to come up with your own music?
That’s not really the most fundamental point, however, which is: each individual has a right to benefit from his efforts, and to determine the nature of that benefit. Intellectual property is perhaps the clearest product of one’s efforts, because it’s the direct result of one’s thinking. Mankind hasn’t advanced through his physical prowess, but rather through his cognitive abilities–his creativity and inventiveness. That’s the essential nature of man.
In this thread, “society” has been held up as the important beneficiary of this effort. But, who is “society”? It’s the individuals that comprise it. There’s not some critical mass of individual benefit that mixes together and creates the “right” level of “societal benefit.” There are just individuals who benefit, or who don’t.
And, how does that benefit derive? If you invent something, but hold that invention inside your mind, has something been taken from someone else, something that they have a right to? No, of course not. If you invent something and produce it, and offer it for sale, is it now something that someone else has a right to? No, it’s not. They only have a right to purchase it from you, if they can afford the price and if you choose to sell it to them. If someone asserts that they _do_ have a right to your invention, then how would that right be realized? Would government force you to sell it to them, at a lower price than you intended? What if you refused to do so? Would you be thrown in jail? Or would government merely allow others to copy it and sell it themselves?
What if you decided not to produce something at all? Would government then put you in jail until you agreed to be productive again? After all, if someone has a right to what you produce, then how can you have a right not to produce it?
That’s the essential nature of saying that it’s not for an individual’s benefit that his efforts should be directed, but “society’s.”
Patents and copyright exist because otherwise, there would be no way to protect from the mere copying of intellectual property, which necessarily infringes on the creator’s right to control it. That’s the only thing that makes intellectual property different from material property, and the fact that some property is now essentially trivial to copy and distribute only makes matters worse.
Every song that someone downloads is a copy that wasn’t purchased, meaning revenue that’s lost to the copyright holder. Note that some people download copies off the Internet specifically under the notion that they’ll buy a copy “if they like it.” Is that really up to them to decide? It certainly doesn’t apply to material property. I can’t “borrow” a car off a dealer’s lot, drive it around for a few weeks, and then decide to purchase it only because I like it. That’s called grand theft auto, and I’m arrested for it. The argument that intellectual property is different merely because one can make a copy without taking away the original from the owner is meaningless. It’s not possession of the copy that matters, it’s compensating the creator that counts.
Certainly, any copyright holder can make the decision to make their material readily available on the Internet, to drive concert attendance, CD sales, higher quality digital downloads, or whatever, and it might even make economic sense to do so in some cases. A car dealer could do the same, by offering extended vehicle test drives (and, some do that, again where it makes sense to them). However, that’s up to the property owner to decide, not anyone else. and without protection, no property owner has any way of making that decision for himself, and of enforcing it.
If you believe that the patent system has problems, then speak to that. I for one would agree: technology has changed things somewhat, in the sense that it has complicated them. For example, should software be copyrighted, or patented? I really don’t know; I’ve seen compelling arguments on both sides. It _should_, though, be protected, because otherwise, again, it could be copied into infinity with no benefit returning to its creators according to their standards. Someone might _choose_ to write open source software and to give up certain rights of ownership, but again, that’s up to each individual to decide.
Re: Not Really
Mark,
I’ll note that you simply resort to your emotional arguments without any facts and don’t reply to any of the actual points we raised. This seems to happen a lot when folks like you who believe in the myth of intellectual property first encounter evidence that it doesn’t work they way you were promised… but if you start exploring you’ll find that your belief is built on a long list of assumptions which don’t actually bear out in reality. Time for you to start doing some research.
I like how you set the terms of your scenario that brought in all sorts of assumptions and set up a very specific case where you believe an inventor could be hurt. I could just as easily set up a scenario to prove the opposite — and neither is particularly instructive. Instead, go look at the data. Go look at the rate of industrialization in the Netherlands when they got rid of patents. Look at the rate of industrialization in Switzerland before they added patents. Look at the pharmaceutical industry before and after Italy allowed pharma patents. All of these show that your belief of what patents do is simply false.
A big part of your problem is that you keep insisting on a few things that aren’t true. Ideas aren’t “property.” Someone coming up with the same idea isn’t “stealing” anything. Nothing is lost.
Now, some other factual problems:
Your only other alternative would be to keep some aspect of your invention (or manufacturing process, whatever) as a trade secret. You’re able to keep the specifics hidden, and you and your heirs (or some other entity who buys your business after you die) also manages to keep them hidden. Your invention is produced into infinity, and nobody ever learns the secret. Thus, some other invention that would have otherwise been possible never materializes, and science is _not_ advanced.
This is one of the silliest arguments around concerning patents and it falls apart the second you actually think it through beyond the superficial level. Since patents are for a limited time, it’s still more valuable for many companies to keep ideas as a trade secret. If you believe that others will not be able to figure out your invention, then you’re going to keep it as a trade secret anyway because it should be more valuable that way. The only reason you’d get a patent is if you realize that others are going to figure out that same idea eventually anyway.
Ultimately, I find the notion simply fascinating that patents and copyrights hamper innovation
Then I suggest you look at the research. There’s an awful lot of it. I’ve given pointers in the past, but some places to start your research are the work of David Levine and Michele Boldrin. Then Eric Schiff’s research. Next up: Lerner and Jaffee. And Samson Vermont. Then look at the research by Michael Heller and Rebecca Eisenberg. Then look at the research by Petra Moser. Then the research by Mariko Sakakibara and Lee Branstetter. Then there’s the research of Robert Hunt. And Fritz Machlup. I could go on…
So time to go do the actual research and then come back and tell me what’s fascinating. That the research all shows that patents and copyright can harm innovation or that you believed the myth in the first place?
If you want to compete against someone with a patent, you’re necessarily required to create your own invention that doesn’t infringe.
Do you recognize how inefficient it is to reinvent the wheel? If I can do a better job bringing the wheel to customers who demand the wheel why would you prevent me from being able to do so?
You talk about originality, but you think of originality only in terms of the invention, when that’s a tiny part of innovation. Actually successfully bringing products to a marketplace where supply and demand set the price is innovation. You are preventing innovation for the sake of invention.
Patents and copyright exist because otherwise, there would be no way to protect from the mere copying of intellectual property, which necessarily infringes on the creator’s right to control it.
How many times do you plan on repeating this simply false statement? You have no right to control an idea. None. Ideas spread freely. Controlling it LIMITS your market. It LIMITS your ability to profit. It LIMITS everyone’s individual rights. You go on and on about individual rights, but then seek to limit them.
That’s the only thing that makes intellectual property different from material property, and the fact that some property is now essentially trivial to copy and distribute only makes matters worse.
You really need to learn about the history of “intellectual property.” The fact that it’s essentially trival to copy and distribute content doesn’t make matters worse, it increases the reservoir of resources. It’s a tremendous benefit to individual rights. The fact that you think otherwise is inexplicable.
Every song that someone downloads is a copy that wasn’t purchased, meaning revenue that’s lost to the copyright holder.
Ah, the old “lost revenue” argument. It’s bogus. Lost revenue isn’t a crime, it’s a marketing decision. If I have two choices for lunch, a sandwich shop and a pizza place, and the sandwich ship offers me a coupon for a free drink, so I choose it over the pizza shop, by your argument the pizza shop just “lost” my revenue and therefore the pizza shop should be able to sue the sandwich shop for “stealing.” Sounds bizarre, right? But that’s exactly what you’re saying above.
Another way to put it: did Henry Ford “steal” from horse drawn carriage makers when he sold the Model T? After all,m that revenue was “lost.” By your reasoning he absolutely did.
But that’s the thing. Lost revenue isn’t a crime. It’s an economic statement saying that you did not provide the right incentives to collect the revenue yourself. That’s the free market and that’s business. There is no lost revenue, only revenue you were unable to capture.
Note that some people download copies off the Internet specifically under the notion that they’ll buy a copy “if they like it.” Is that really up to them to decide?
Mark, you seem to be arguing against a phantom. I don’t make this argument anywhere. Stop pretending what you want me to believe and start responding to my actual arguments.
I can’t “borrow” a car off a dealer’s lot, drive it around for a few weeks, and then decide to purchase it only because I like it.
Right. Because a car is a scarce resource. Content and ideas are not. Learn the difference.
However, that’s up to the property owner to decide, not anyone else. and without protection, no property owner has any way of making that decision for himself, and of enforcing it.
Mark, you seem to be a fan of Ayn Rand. Do you tell people about her ideas? Aren’t you stealing from her by not paying her back for passing on her ideas?
However, that’s up to the property owner to decide, not anyone else. and without protection, no property owner has any way of making that decision for himself, and of enforcing it.
Yes, but with an idea or content, the “owner” isn’t giving up his content. He still has it. So your example is entirely false. They still get to decide what to do with it.
It _should_, though, be protected, because otherwise, again, it could be copied into infinity with no benefit returning to its creators
Again, you make the entirely FALSE assumption that there’s no way to benefit. This is simply false and easily shown as false.
The point here is that you want to take away individual rights because of some artificial construction. You believe that some individuals (those who can get a patent or copyright) deserve more individual rights from others. That’s not good for individual rights and it’s not good for society.
You need to check an awful lot of your assumptions.
Not Really
Thanks for the engaging debate, but I think I’m done with this one. This argument is getting far too repetitive for my tastes. And, terms like “ideas” and “protectionism” and “property” are so misdefined and muddied that it’s just about impossible to get a point across.
In closing, you talk about “ideas,” but that’s not what I’m saying needs protecting. The idea that individual rights are important isn’t something that Ayn Rand had a right to protect. “Atlas Shrugged” is. You equate an “idea” with its presentation to make your argument work, but that’s nothing but a straw man.
Then, you refuse to differentiate between a decision that a property owner makes (like, his offering a coupon) and the confiscation of his property rights entirely (like, someone downloading a copy of his song and thus not purchasing it). That’s simply a failure to understand the underlying principle.
And finally, you’re not paying enough attention to my arguments, and thus misstating them. This is your forum, and so you can do that, but it’s tiring and unproductive.
I look forward to future debates out in the world.
Re: Not Really
Mark,
That’s bizarre. Every complaint you make against me could be more accurately made against you.
Thanks for the engaging debate, but I think I’m done with this one. This argument is getting far too repetitive for my tastes. And, terms like “ideas” and “protectionism” and “property” are so misdefined and muddied that it’s just about impossible to get a point across.
I would argue it’s you who do not understand those terms. You have repeatedly mixed up scarce and infinite goods as if they were the same thing. You seem to have no idea what property actually means. You seem to have no idea what individual rights actually means. Considering this is the basis of your argument, it makes it tough to take you seriously. You repeat falsehoods and myths and ignore the evidence provided against them.
In closing, you talk about “ideas,” but that’s not what I’m saying needs protecting. The idea that individual rights are important isn’t something that Ayn Rand had a right to protect. “Atlas Shrugged” is. You equate an “idea” with its presentation to make your argument work, but that’s nothing but a straw man.
You accuse me of a strawman when you repeatedly said what you thought I said and knocked it down, rather than responding to my actual points. You are also the person who set up a single contrived scenario as “proof” and ignored all the research we pointed to. Which is more credible?
Then, you refuse to differentiate between a decision that a property owner makes (like, his offering a coupon) and the confiscation of his property rights entirely (like, someone downloading a copy of his song and thus not purchasing it). That’s simply a failure to understand the underlying principle.
Again, it’s you who seems to have trouble understanding the underlying principle of the difference between scarce goods and infinite goods.
And finally, you’re not paying enough attention to my arguments, and thus misstating them. This is your forum, and so you can do that, but it’s tiring and unproductive.
This is the most bizarre argument of all. You don’t respond to a single point I make, whereas I actually quote your points and point out where you’re wrong — as did Emi.
What I think you mean is that the cognitive dissonance is kicking in in your brain, and since our arguments actually are supported by facts and history and logic — you simply assume that we’re not disproving each of your points. Go back and point out which one of your points we’ve misstated.
However, if you want to bail out rather than learn something, that’s your decision, but I beg you, if you’re still interested in this area, PLEASE GO EDUCATE YOURSELF on actual research.
I listed out some points to start your research. I suggest you at least follow up on a few. At least then maybe you won’t trot out the same tired disproved arguments.