Software patents shouldn’t be abolished, but they should be reformed

Chris Dixon has written about why software patents should be abolished.  I don’t agree, though I do agree they need a massive amount of reform.

But first, an aside. I’ve been reading Chris’ blog for the last few weeks, ever since News.YC started posting all his links.  He’s one of the few entrepreneurs who has a blog worth reading, and rarer still, I see eye to eye on nearly everything he writes.  I’ll do another post at some other point highlighting some of my favorite essays of his, but the point of this introductory post is to discuss about my views on how to fix software patents (as opposed to simply eliminating them).

Software patents are an interesting construct, and highlight the extreme abuse of patents in general.  There is nothing inherent about software patents that make them more egregiously abused than other patents, just that software companies patent more than companies in any other field.

Chris does a good job discussing the the issues with patents, including one of the most serious, that examiners aren’t qualified to examine patents.  The reality is that they are quite qualified, they simply don’t have the time to properly evaluate patents because they are so deluged with applications. And, they are not just applications from inventors, but they are reviewing applications from lawyers who craft the filings to be both specific and broad at the same time!  In a special language using special diagrams and other constructs specifically developed to create ambiguity, where certainty belongs.

So that needs to be fixed.  But that’s not the most serious problem with patents.  The most serious is that the cost to file a patent is relatively low, and once granted, a patent lasts for up to 20 years.  This has generated collectives of patent trolls who collects 1000’s of patents that they use to aggressively pursue “infringers” (I mean, innovators).  20 years to go after people is a long time in the world of innovation.  But in a world of broad and vague patents, 20 years can represent 20 years of massive royalties and headaches for inventors.

In my mind, the solution to patent trolls is to make the cost of a patent increase every year.  If a patent costs $100 in year 1, $1000 in year 2, $10,000 in year 3, $100,000 in year 4, $1,000,000 in year 5, $10,000,000 in year 6, $100,000,000 in year 7 and $1,000,000,000 in year 8 then at some point the cost of renewing a patent will exceed the benefit derived.  But this model would also provide for a clear and transparent way for a company to protect a patent indefinitely so long as the holder derives more benefit than the cost of renewing.  Perhaps an exponential cost model is too aggressive, but some sort of sliding scale could be established to accomplish the same means.

What do you think?  Would this model work?  This doesn’t stop people from filing applications, but I’m sure a similar model could be worked out on the application side to help stem the tide of applications.

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