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Are patents stifling innovation in mobile devices?

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By David from Truth, Justice, and the American Way,cross-posted by MetaBlog

In 2007, I wrote why software patents are not a good idea.  It’s easy to find examples of patent abuse but its not often to find a company that uses patents that stifle a whole industry.  Such may be the case with the Apple iPhone.

I purchased an iPhone shortly after it came out, because I recognized that it was a revolutionary device.  It was not a case of superior specifications, as many devices have better hardware.  It didn’t even run on the latest 3G network until the second generation.  Rather, it was a superior design, which featured an intuitive user interface that did not try to compete on the number of features but on usability.  Apple fully deserves the billions of dollars it has made and will go on to make from its device.

Yet something curious has happened. When Apple introduced the iPhone, those who recognized its revolutionary potential expected the innovations and design concepts it introduced to percolate to the rest of the industry.  To an extent, that is happening, but key iPhone technologies -a capacitive touchscreen with multi-touch, a 3-axis accelerometer, proximity sensors, graphics acceleration integrated integrated into the UI, and a number of other key innovations have not been found in competing products.  Part of the reason for this has to do with the particular culture and expertise found at Apple, but its indisputable than the 200+ patents covering the iPhone have gone a long way to discouraging competitors, who offer alternatives lacking key features - until now.

Palm, the company who created the first popular PDA is coming out with the Palm Pre, the first device to brazenly infringe many of the key iPhone patents.  Apple is already making threatening gestures, so an apocalyptic legal battle is almost certain.  Palm is the first company to go against Apple head on because  its status as the one-time leader in the PDA and mobile phone market makes it the only company capable of challenging Apple’s leadership.  While the Palm Pre clearly borrows ideas from the iPhone, the iPhone itself uses many of the innovations first patented by Palm as early as 1996.  Today Palm is a marginalized has-been for whom the Pre is a desperate gamble to save to company, but it still has the patent portfolio of a market leader.

The question of who is the bigger infringer in this battle is besides the point.  The issue is that the patent system is limiting innovation to large companies who have established sufficiently large patent portfolios to pose a credible threat of retaliatory patent lawsuits.  The best that new competitors can hope for in this environment is to be aquired by the giants or to establish their own patent portfolios - rather than create products than people want to use.

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Cross-posted from Metablog

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No. The ultimate purpose of businesses and the people in those businesses is to make a living to make extortionate profits by bleeding the market for all it will bear, not to serve the convenience of the end users. Customer service is a means to an end. Curtailing intellectual property rights will benefit no one as each new invention is immediately commoditized. Commodity businesses are low margin and do not attract the kinds of minds and innovations you take for granted as characterizing the tech industry.

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No. The ultimate purpose of businesses and the people in those businesses is to make a living to make extortionate profits by bleeding the market for all it will bear, not to serve the convenience of the end users.

Entrepreneurs have many motivations, such as a desire to change the world, practice their art, or to get rich. These are all rational reasons to be in business. (BTW, you should look up the meaning of 'extortionate')

Curtailing intellectual property rights will benefit no one as each new invention is immediately commoditized.

We should keep in mind that property is a moral concept which arises as a solution to a particular problem - the scarcity of certain of certain goods in the world. If we can demonstrate that certain things (such as software algorithms) are not scarce, then it doesn't make sense to apply the world "property" to them. Misidentifying the nature of property rights means the violation of legitimate rights.

Commodity businesses are low margin and do not attract the kinds of minds and innovations you take for granted as characterizing the tech industry.

You are assuming that the motivation for innovation depends on intellectual monopoly, and that profits are not possible without such a monopoly. I think if you look at the open-source software movement, you can see both innovation and profits being made. People have many means besides patents to protect their ideas, and many ways to make money from their ideas even the ideas are free.

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We should keep in mind that property is a moral concept which arises as a solution to a particular problem - the scarcity of certain of certain goods in the world. If we can demonstrate that certain things (such as software algorithms) are not scarce, then it doesn't make sense to apply the world "property" to them. Misidentifying the nature of property rights means the violation of legitimate rights.

Property rights have nothing to do with scarcity.

A software algorithm, like a book, piece of music, or work of art, are the products of someone's mind. There is no fundmental difference between software and any other type of IP.

Downloading "non-rival" music, movies, or books without permission is a violation of property rights. The same principle extends to patents.

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We should keep in mind that property is a moral concept which arises as a solution to a particular problem - the scarcity of certain of certain goods in the world. If we can demonstrate that certain things (such as software algorithms) are not scarce, then it doesn't make sense to apply the world "property" to them. Misidentifying the nature of property rights means the violation of legitimate rights.

This idea that scarcity justifies property rights implicitly contains within it a utilitarian standard of the good. It is not consistent with Objectivism.

You are assuming that the motivation for innovation depends on intellectual monopoly, and that profits are not possible without such a monopoly. I think if you look at the open-source software movement, you can see both innovation and profits being made. People have many means besides patents to protect their ideas, and many ways to make money from their ideas even the ideas are free.

No such assumption is made or necessary. It is possible to live by hunting and gathering in the absence of all property rights. It is objectively better to live in a society that does define and defend property rights, including intellectual property.

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There are some differences between an algorithm and a sheet of music or a book: the same algorithm (=solution to a problem) can be discovered by two separate people looking for the solution to the same problem. Why should then the guy who rushed to the patent office with it first be the owner of the solution to a problem for 50 years, meaning have the right to forbid the other guy from solving the problem the same way? (even though he could’ve found the same solution in a month)

The reason why I nevertheless disagree with the article is in fact contained in the article itself: the IPhone is special because of its design and usability, and all those specific clever things the author lists, which are not algorithms. I wouldn’t be so sure that someone should just be allowed to borrow most of those ideas. At some point, a judge will rightfully decide that a product is just a copy of the IPhone. With all this new technology, the standards have to be created as well, so let’s just hope the courts get it as close to right as possible (meaning as close to rewarding truly innovative work and ideas rather than the ambition to win the race for things everyone can obviously come up with pretty much at the same time-things GreedyCapitalist referred to as “not really scarce” ideas )

Surely, you guys admit this much: if I come up with the idea to take a shortcut to work-be it a shortcut no one ever used before, I don't have the right to make other people continue taking the long rout, to protect my "achievement" of being there first and looking good in the boss's eyes.

Edited by Jake_Ellison

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Property is *not* recognition of scarcity.

See my post

And a post at Noodlefood

Those were excellent articles, and I agree that the scarcity claim is not the root of property rights (including intellectual property). The inventor of a computer algorithm is not taking anything away from those who did not come up with that algorithm -- it didn't exist before the creator implemented his idea into material form (i.e. the program or part of a program). It would be like the inventor of a wrench or a screw driver -- he got the computer to do something by means of a specific tool designed to operate the machinery in a particular manner.

As to the idea that patents and copyrights stifle economic advance, I also agree that without the protection of the creator of those products, innovation would cease -- simply look at those time periods in history in which intellectual property was not recognized. It wasn't a lack of knowledge per se that lead to the Dark Ages being dark, it was the lack of any concern for things of this earth, and a lack of protection for property rights (including intellectual property). With the advent of protection of the creator / producer, mankind was able to rise out of range of the moment considerations; he could plan long-range (say 20-40 years) or the rest of his life by having his intellectual property being recognized legally as being his. So, I think there might also be an implicit collectivism in thinking that society would benefit from a lack of recognition of intellectual property rights; maybe in the very short run society would "benefit" by not having to pay the producers, but in the long-run we'd be back to pre-nineteenth century industrialization.

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I'm not arguing against intellectual property.

I don't completely agree with calling everything you consider intellectual property that. There's a reason why intellectual property shouldn't last forever, and the same reason should be used to limit the things which can be declared intellectual property.

I'm arguing that there are certain problems which arise let's say in the year 2017. (such as, and I'm making this up without trying to have it make sense, the need for an optimal protocol-much like the protocols used on the Internet- for a new type of cell-network everyone plans to use, let's call it a hypothetical G9) There are 5-6 companies who have the ability and resources to find the optimal solution to this problem (which often tends to be the one solution, or a few very similar ones) in about a year. However, one company comes up with it in 11 months, runs to the patent office and declares it his. Does that mean that the other companies now can be sued if they use the same set of rules (the only ones which work as well) when transmitting data?

Does this make this solution the intellectual property of this company for a few decades?

I don't think so. If the other companies can be proven to have simply taken a chip from the inventor company and copied the code to their own device, sure. But otherwise, just because the two codes are conceptually similar, that patent shouldn't hold, the way it would hold with a piece of music.

Another good example would be Formula 1 racing, in which the teams tend to come up with similar technology in a given period to adapt the cars to the constant rule-changes. If the different manufacturers were allowed to run to the patent office every time they come up with a new piece of very complex technology, beating the other teams by literally days, would enforcing that claim be fair?

Edited by Jake_Ellison

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There are 5-6 companies who have the ability and resources to find the optimal solution to this problem (which often tends to be the one solution, or a few very similar ones). However, one company comes up with it in 11 months, runs to the patent office and declares it his. Does that mean that the other companies now can be sued if they use the same set of rules (the only ones which work as well) when transmitting data?

Absolutely! If company A comes up with the solution before company B, then that intellectual property morally and legally belongs to company A. That's the way it is with patents especially, since they are usually specific enough that it is unlikely that someone else will come up with it. Back in the days of Thomas Edison, there was always a rush to the patent office for any new idea made into material form in order to claim legal ownership of the patent. Without this legal recognition, people like Edison wouldn't even exist or be productive -- why would they bother? I mean, sure, there were some great innovations in Ancient Greece and Rome simply because the innovators had the freedom to innovate, but without a way to make money coming up with their ideas, they usually just kept the mechanism functionality a secret, which doesn't improve further innovations.

So, if at some point in the future someone has to come up with a new Internet protocol, say because the old one is overtaxed with users and slows down, then that innovator has the right to charge for his innovation -- and he can forbid others from using it, if he choses. A more profitable way of doing that, however, is to license the services to users of his system.

When we are talking specifically about the iPhone and other such innovations, sure, whoever came up with the ideas and put them into material form -- i.e. the iPhone and it's features -- has the right to prevent others from using those features and functions without their permission. This goes for the previous innovator who came up with the predecessor of the iPhone. Without that kind of protection, why would they put millions and millions of dollars into coming up with the iPhone in the first place.

By the way, this isn't all all the same as fining a new way to work. The roads exist and can be used by anyone, and your particular way to work cannot be forbidden to others under the terms of using the road. Even with all private roads, this would be the case. The analogy would be forbidding a user of the iPhone from pressing certain buttons to call a specific telephone number -- you can't prevent anyone else from calling that number, once they know it. Just as you can't prevent me from typing a particular name on my computer key board. Now, you may be confusing a process patent with driving directions. A process patent is like an exclusive procedure to create something, and the creator of that process can prevent others from using that process to, say, create a particular plastic.

Really, what some of these arguments come down to is the one presented in Atlas Shrugged: Why should Hank Rearden be the only one to profit from the production of Rearden Metal? which is answered by the novel.

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Part of the current problem facing those using radio waves to transmit data is the idea that the government owns the airwaves and only licenses out the ability to use airwaves instead of protecting by law private ownership of those frequencies. The recent talk of re-instituting a "fairness doctrine" regarding the "public airwaves" is a case in point. So, for something like, say, a 5G radio wave transmitter and receiver, whoever came up with the electromechanics to transmit and to receive those frequencies would not only own that private property of the means of doing that, but would also own those frequencies outright. Not only could he forbid the unlicensed use of his device, he could forbid anyone else's device from accessing those frequencies. In other words, under capitalism, the person or company who made it possible to communicate over a range of frequencies not previously used, would own the means of doing that and those airwaves. So, when it comes to accessing someone else's network, no that should not be open to all, there should not be a "net neutrality" with regard to networks, but rather they should be privately owned and operated.

For things like features that requires a specific technological device to implement, certainly the creator of that device has the right to require that others not use it unless they want to pay him for it. Even something a simple as the push button can be patented, as can a touch screen, or any other mechanical / electric device for performing a certain function.

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Property rights have nothing to do with scarcity.

Rights are a moral concept which serves the purpose of allowing individuals to maximize value achievement in the context of social interaction by providing basic principles for non-conflicting value exchange. As such, they are a practical invention, which arises (like all concepts) from certain facts of reality.

These facts include: that man requires certain material values to live; that these material values are scarce; and that physical and mental effort is required to convert the elements of nature into a form useful to man.

In the case of property rights, the fact that material values are scarce is the key aspect of reality that makes property necessary. If material values were not scarce (and some aren't), men could maximize value pursuit without regard as to where they obtained their resources (as is the case with air, for example.)

Thus, scarcity is the key aspect of reality that makes property necessary. The means by which we identify the proper moral owner of property is provided by another aspect of reality - that mental and physical labor is needed to make the elements of nature useful to man.

Thus, scarcity is the premise that makes property rights necessary, and productivity is the premise which makes the assignment of property rights possible.

I'm not ready for a debate on intellectual property right now, but I want to make one further point in response to the comments above: I see a confusion between a defense of property rights on moral, practical, empirical, and utilitarian grounds.

Objectivism identifies the moral as the practical, so attacking a claim on moral grounds is ultimately a claim that the claim is impractical as well. It is fine to make a moral claim when the disagreement lies in the application of a common moral principles, but it is not logical to make a moral claim when the disagreement lies in the validity of the moral principle itself. For example, when the virtue of selfishness is attacked, we must explain the practical importance of egoism rather than merely responding that "altruism is immoral."

In the context of patents, you cannot claim that "repudiating patents is theft" when the debate is over the identification of patents as property. In this case, you must demonstrate from common moral principles *and their practical application* that the moral assertion is valid. This is not utilitarianism, but the means by which higher-level moral principles must be validated.

On the other hand, I see some people making the claim that "without patents, we would have less social/technological progress." This *is* a utilitarian claim, and so it is fallacious in the premise that "progress" is a universal moral good. Progress is a value for some individuals in some contexts, but it is not an absolute standard by which we can validate moral principles. The proper aim of morality is not to maximize progress any more than it is to maximize individual wealth - these are byproducts of value achievement. Besides being utilitarian, it is also an empirical claim of the special sciences (such as economics, politics, history, and law), and so must be validated in a scientific manner within a historical context, with a full cost/benefit analysis. (The protection of individual rights is not "free" - it has non-trivial enforcement costs, which in some contexts outweighs the benefits.)

It is fine to validate moral principles by making predictions from principles and validating them against empirical observation. However, it is fallacious to do it the other way around - you cannot derive moral principles from statistical analysis. That is how we ended up with antitrust, Keynesianism, and other varieties of socialist calculation.

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It is fine to validate moral principles by making predictions from principles and validating them against empirical observation. However, it is fallacious to do it the other way around - you cannot derive moral principles from statistical analysis. That is how we ended up with antitrust, Keynesianism, and other varieties of socialist calculation.

I don't think anyone was making the argument that statistically we get more for society if we permit the operations of patents. That result is true, but it is a result and not the reason why we have patents. To some degree, patents are limited to 20 years instead of 50 or 100 years in order to encourage more production based upon the discovery behind the patent, because due to the nature of the material creation, others can build upon it to make their own creations. One might argue, for example, that 25 years or 30 years is better than 20 years, but that is still within the guidelines that the primary beneficiary of a patent ought to be the patent holder, and not society per se. For something like a novel, there is no need for anyone to build upon, say, Atlas Shrugged, in order to further advance literature; an innovator can come up with another story without the necessity of using the characters in a given novel. Inventions are different in that one may have a good use of some previously created product to make another product from, which is one reason there time limits on patents.

But the whole issue does not come down to scarcity. The air we breath is not a man-made commodity, and so you cannot be prevented from breathing the air on Earth. However, for some place like Mars, where the air would have to be created from chemical reactions, the person making that possible would have the right to say, "You can't breath my air -- I own it!" or to charge you a fee for breathing.

The fact that some man-made product might be scarce -- and they all are at the beginning before mass production -- is not the bases for someone owning that product as property; it is property because he made it, and as the creator of that property, he can set the terms for utilizing his property, including licensing fees, if he so chooses. The fact that someone else may come up with the same idea and put it into a similar product does not invalidate the fact that the original creator made it first, and therefore can set the terms as to its use.

Besides, if you are going to make the argument from scarcity, then once a product becomes less scarce there is an implication that it is no longer private property -- i.e. it is very easy to get toilet paper in this country, but that does not mean that the toilet paper on the store shelves is not private property. The scarcity is part of the economic evaluation as to the price of the product, but has nothing to do with it being property at all. If we had a thousand writers who could crank out Objectivist based literature each in a few years and mass produced those novels, they would be less scarce, but each one would still be owned by its creator. Likewise, just because computers are becoming less and less scarce does not make them less and less private property.

The creator of a new product qua creator needs to be protected from those who would take all his hard intellectual work from him by using the product of his mind against his will.

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I will throw in my two cents here. I originally posted this response here to Mr. Veksler's post:

***

You conclude by saying, “The best that new competitors can hope for in this environment is to be acquired by the giants or to establish their own patent portfolios - rather than create products than people want to use.”

I don’t accept the patents versus good products dichotomy you are stating. To what extent was Apple’s willingness to invest millions of dollars to develop the iPhone dependent on the comfort it took in that its intellectual property would be protected?

Its willingness to sponsor the development of capacitive touch-screens and 3-axis accelerometers, which make the iPhone a great product, would have been compromised if it could not own those developments and profit fully from them.

I think you might be making a better case for *shorter* patents rather than for their abolition. The proper length of a patent just like the proper length of a copyright is something that changes depending on technological and economic factors. Perhaps one can make the case for shorter patents in technology and longer ones in drug development. All of this should be coupled with a better patent office run on rational principles. That means issuing patents quickly and only for true innovations (which you made in your argument against software patents, which has legitimacy, in my opinion).

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This idea that scarcity justifies property rights implicitly contains within it a utilitarian standard of the good. It is not consistent with Objectivism.
How would you derive a right to property in Objectivism. It's not self-evident, so what creates the right? I think GC's explanation is totally correct. You shouldn't confuse "that which is actually necessary for man" with some fuzzy "greater common good" notion. Rights serve a purpose.

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How would you derive a right to property in Objectivism. It's not self-evident, so what creates the right? I think GC's explanation is totally correct. You shouldn't confuse "that which is actually necessary for man" with some fuzzy "greater common good" notion. Rights serve a purpose.

The Ayn Rand Lexicon online has many entries under the search term "property":

http://www.aynrandlexicon.com/searchresult...q=property#1060

Under the heading of "property rights" Ayn Rand says this:

"Any material element or resource which, in order to become of use or value to men, requires the application of human knowledge and effort, should be private property—by the right of those who apply the knowledge and effort."

And further down under "property rights" she says:

"Just as man can’t exist without his body, so no rights can exist without the right to translate one’s rights into reality—to think, to work and to keep the results—which means: the right of property."

I'm not trying to make an appeal to authority here, just pointing out what Miss Rand said in the context of property and property rights. Clearly, though, the one who goes through the effort to create something is the owner of that property, and it becomes his property because he made it. The idea that one ought to be free to use patented material for one's own use without permission of the owner would be like saying one ought to be able to use someone else's car without his permission. Or, if one comes up with a computer algorithm that no one else has, and doesn't tell anyone about it but has it solely for his own personal use, then under some of the arguments here, he has no right to do that and must give anyone permission to use his own personal computer against his will.

Regarding the length of time of patents, I wouldn't say that twenty years is necessarily the best time frame. Back when the life expectancy was only 40-50 years, it made sense, but if anything, since life expectancy is longer these days, then perhaps the time of a patent ought to be lengthened, not shortened. The argument made for extending pharmaceutical patents to more than 20 years stems from the fact that it might take up to 10 or 20 years for the FDA Czars to approve of it, by which time the patent holder cannot benefit much from his own creation. On this note, the best argument I have heard regarding extending patents is that so long as there is a delay in getting a patent approval, then the patent time period starts after it has been approved, and therefore the patent holder can properly benefit from his property.

From what I've heard, the patenting process needs to be streamlined and refurbished, but it would have to be done with the right principles involved. I don't think there is a good argument for shortening patent times for the sake of getting more innovations based on expiring patents. The computer age has brought extremely reduced times for the usefulness of an application, because the market changes so quickly, but that is really a reverse argument for shortening patents, since the quick innovations come up even though patents expire in 20 years instead of 10. In other words, I don't see the evidence that having a patent for 20 years is stifling innovation.

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How would you derive a right to property in Objectivism. It's not self-evident, so what creates the right? I think GC's explanation is totally correct. You shouldn't confuse "that which is actually necessary for man" with some fuzzy "greater common good" notion. Rights serve a purpose.

Ethics is the branch of philosophy concerned with action; it answers the question "what should one do?" Politics is ethics applied to actions concerning other people. Economics is politics applied to property. To use the economic concept of scarcity to justify the ethical and political principle of rights violates the hierarchy of knowledge.

Rights do serve a purpose. They define the boundaries of a man's action with respect to other people. Acts which are both rational and within the bounds of rights will create some good for the actor. Acts which trangress the bounds of rights are necessarily both irrational and evil. Property rights establish one's right to act upon material goods. Fundamentally all property rights are justified and derived in the same way: causation as described by Thomas M. Miovas just above.

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Objectivism identifies the moral as the practical, so attacking a claim on moral grounds is ultimately a claim that the claim is impractical as well.

True.

It is fine to make a moral claim when the disagreement lies in the application of a common moral principles, but it is not logical to make a moral claim when the disagreement lies in the validity of the moral principle itself.

Yes. Moral principles are integrations formulated by observing the practical effects of various human choices.

And so, a guarantee that a man will own the product of his effort (physical and/or intellectual) is a practical necessity of life (his life).

(A challenge of this claim seems to be implied in your post - is that the case?)

Others also benefit from this arrangement because, as we know, it is a strong motivator for innovation and leads to higher productivity. This benefit, however, is a secondary consideration.

-----------------

But let's consider this secondary consideration.

The notion that patents and copyrights stifle innovation is a faulty one because it drops context. There is no bigger killer of innovation than lack of adequate protection of property rights. The act of invention often involves a substantial upfront expenditure of time and/or money (in pharma, for example). Why do this if the good ideas can be quickly copied? It is true that some level of innovation could be sustained in the absence of intellectual right protections but in a lot of cases the initial investment is simply too large to make sense economically in the absence of such protections.

The protection of individual rights is not "free" - it has non-trivial enforcement costs, which in some contexts outweighs the benefits

Can you give an example of such context?

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Ethics is the branch of philosophy concerned with action; it answers the question "what should one do?" Politics is ethics applied to actions concerning other people. Economics is politics applied to property. To use the economic concept of scarcity to justify the ethical and political principle of rights violates the hierarchy of knowledge.

Intellectual property rights are protected by patents, which are defined as "a guarantee that a man will own the product of his intellectual effort is a practical necessity of life. (I'm quoting Sophia because it's a good definition, and it's handy.).

The key here is guarantee to own the product of his effort. And yes, if someone comes up with a design, you can't steal it because the materials those objects (i.e. cars) are not scarce.

But what if the idea itself isn't scarce? What if the idea is a solution to a brand new problem, but a solution that is relatively obvious to everyone competent in the field. Why is the winner of the contest to perfect that obvious solution entitled to claim the solution as his personal property? How is the monopoly on that solution the product of his effort?

I say it isn't, because the ability to come up with it is not scarce. (the reason why no one did it before is that there was no need to solve a problem, because the problem didn't exist) And yet, I keep asking this question, and I keep getting the same answer: it is, because ...answer goes into why it is important to uphold property rights. I'm not disputing property rights, and the ethics behind them.

What exactly is and isn't intellectual property doesn't just rely on that hierarchy of knowledge, it relies on observation. Namely it has to be determined what is the product of one's effort, and what is not. Part of the reason for limits on patents is that eventually someone would come up with that invention on their own, so you can't award the property over the concept to it's first discoverer forever. What if that time, before the next company gets would get there, on their own, is just a month?

I'm asking you for that determination, in the case of a very much conceivable and attainable solution (hence not scarce) to a new problem (i.e. an algorithm that solves some G3 glitch in cell-phone communications), not another lesson in the ethics behind property rights.

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And so, a guarantee that a man will own the product of his effort (physical and/or intellectual) is a practical necessity of life (his life).

Yes, I am challenging this claim. The assignment of property rights is only justified when the value in question is scarce. If the value is not scarce, then the pursuit of that value does not restrict anyone else's pursuit of that value, and so it is not necessary to restrict others from pursuing that value. Furthermore, establishing property rights for non-scarce values violates legitimate rights.

Let me give an example: the discovery of the principle E=MC^2 represents a value to the original discoverer, and also to other potential users of that principle. However, the application of that principle by others does not detract from the discoverer's own application of that principle, because the principle behind E=MC^2 is a not scarce resource. We don't recognize E=MC^2 as property because it is not a scarce resource. Furthermore, if the law did recognize E=MC^2 as Einstein's property, it would unfairly restrict the actions of other parties, thus injuring their legitimate property rights.

You will probably reply that the Theory of Relativity does not qualify as intellectual property. But the reason we recognize it as such is because it's obviously non-scarce. The distinction when it comes to inventions is less clear.

Let me now provide a more direct reply to your question: a guarantee than man will own the product of an effort that creates a non-scarce value is not a necessity to his life, but an impairment.

Let me provide an example in addition to one just mentioned: let's suppose that man-made global warming is really raising CO2 levels and warming the earth. Let's presume that both these effects are beneficial to human life (they very likely are). In such a case, industrialists are investing trillions of dollars to bettering the lives of every human being through mental and physical effort. Do they now have a claim on us because they are improving the air we consume? Should we implement reverse-carbon taxes? I would say no, because air is a non-scarce resource, and your usage of warmer, higher CO2 air does not detract from mine.

The notion that patents and copyrights stifle innovation is a faulty one because it drops context. There is no bigger killer of innovation than lack of adequate protection of property rights.

I would say you are dropping the context, in two regards:

First, we are not arguing whether property rights are good. By virtue of defining the moral as the practical, we agree that if a given principle if practical, then it is moral as well - and vice versa. Thus we are arguing on the criteria for what should be defined as property, not whether property rights ought to be protected.

Second, while I agree that property rights confer a benefit and an incentive to the holder of the patent, they also impose an enforcement cost and a dis-incentive to potential creators and entrepreneurs. Potential inventors face the risk of spending time on a invention that may already be patented, being second to arrive at the patent office, having their patent overturned, and spending money on patent lawyers, patent searches and the like. Entrepreneurs likewise risk billions of dollars if a product is found to have violated a submarine patent or their patent is overturned. The fact that patent holders benefit from patents in itself proves nothing - any more than a claim that the U.S. Post Office’s legal monopoly on mail provides them with a benefit.

I am not arguing that the cost of intellectual property outweighs the benefits. My claim is that the criterion usually used to justify intellectual property is incorrect. My purpose is to propose a correct definition of property. Once that is done, the classification of what clarifies as property will be straightforward (I hope).

The act of invention often involves a substantial upfront expenditure of time and/or money (in pharma, for example). Why do this if the good ideas can be quickly copied?

The inventor of the good idea can still create a product with his idea and sell it. Or, he can take measures to protect his good idea from being copied. Trade secrets carry an enforcement cost and a risk of discovery - but patents carry a cost too. It is not a priori obvious which is higher, and many firms still chose trade secrets over patents. For example, it is likely that in the case of the highly patented iPhone, for every patented invention, there are 100 hidden techniques, which were cheaper to keep secret rather than patent. (Again, it is not my purpose to argue the benefit of trade secrets over patents, but to clarify the criteria for defining property.)

Can you give an example of such context?

Let me provide several examples of situations where the cost of establishing and protecting rights exceeds the benefit:

Lifeboat scenarios.

Primitive civilizations. Their ability to recognize property rights is limited by their mathematical and written knowledge. The Egyptians had to invent trigonometry and writing to recognize owners of land on the flood plain - prior to that, the costs of fixed boundaries exceed the benefits. (Actually, the costs were infinite, since keeping such a record was impossible.)

The expanding Western frontier of the USA. (The "Wild West") During those times and in those regions, people still had a right to life, liberty, and property, but the rules of evidence were laxer and the punishments were harsher than in the developed East. This was not because the sheriffs were immoral, but because frontier towns could not afford to have detectives and police departments and long-term jails - the costs of enforcement at Eastern standards exceeded the benefits.

At one point, establishing property rights for fishing grounds on the open ocean exceeded the benefits. With GPS, that became possible. With the miniaturization of technology and better batteries, it is now possible to assign property rights over individual schools of fish. Perhaps whales will one day be tagged just as we began tagging cows.

Radio frequencies were once considered to be solid blocks because any two transmissions on a given frequency range necessarily interfered with another. Today, thanks to the invention of frequency hopping, many transmissions can operate on the same frequency range - this is you don't need approval from the FCC to use Wi-Fi. Also, frequencies are allocated in ever-narrower blocks because better technology minimizes interference.

The rules of evidence for convicting criminals have gotten much stricter. This is not because the justice system’s respect for individual rights is continually improving, but because a higher standard of living and better technology allows us to establish more a more exact definition of rights and more stringer procedures for respecting them.

More generally, rights continually evolve as the costs of enforcements in various contexts change. As a basic principle, rights are as universal as human nature, but in the application of those principles, the protection of rights legitimately varies by the level of development and the particular eccentricities of a given civilization.

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[Apple's] willingness to sponsor the development of capacitive touch-screens and 3-axis accelerometers, which make the iPhone a great product, would have been compromised if it could not own those developments and profit fully from them.

You are probably right. But, to apply the ideas from my previous post, patents may also have compromised the inventor who had a brilliant idea but could not affort an attorney to patent his idea, or a company that is not willing to fight Apple despite having a legitimate invention. (Palm is only willing to do it out of desperation, despite Apple infringing on many of their own patents.) As a Mac enthusiast, I follow Apple's patents - they patent hundreds of fantastic, drool-worthy ideas that will probably never be seen in an Apple product just to be safe. But how many companies do they thus discourage from putting a product on the market? We'll never know - and that's my point. (Not, as some here assumed, to claim that the benefit of patents outweighs their costs.)

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But the whole issue does not come down to scarcity. The air we breath is not a man-made commodity, and so you cannot be prevented from breathing the air on Earth. However, for some place like Mars, where the air would have to be created from chemical reactions, the person making that possible would have the right to say, "You can't breath my air -- I own it!" or to charge you a fee for breathing.

It seems to me, that rather than supporting your point, your example in fact argues mine.

Besides, if you are going to make the argument from scarcity, then once a product becomes less scarce there is an implication that it is no longer private property -- i.e. it is very easy to get toilet paper in this country, but that does not mean that the toilet paper on the store shelves is not private property. The scarcity is part of the economic evaluation as to the price of the product, but has nothing to do with it being property at all.

This strikes me as an absurd argument. Nobody believes that toilet paper should be free because it is cheap. However, if somebody did invent a toilet paper tree and then sprinkled the seeds all over the earth, making them as common as weeds, they would have a hard time claiming that I shouldn't be allowed to grow mine because they own the DNA.

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Ethics is the branch of philosophy concerned with action; it answers the question "what should one do?" Politics is ethics applied to actions concerning other people. Economics is politics applied to property. To use the economic concept of scarcity to justify the ethical and political principle of rights violates the hierarchy of knowledge.

The concept of scarcity is more basic than that of property. For a child to learn that "that is his and this is mine" he must first understand that "I can't use this if he has it."

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Intellectual property rights are protected by patents, which are defined as "a guarantee that a man will own the product of his intellectual effort is a practical necessity of life. (I'm quoting Sophia because it's a good definition, and it's handy.).

The key here is guarantee to own the product of his effort. And yes, if someone comes up with a design, you can't steal it because the materials those objects (i.e. cars) are not scarce.

But what if the idea itself isn't scarce? What if the idea is a solution to a brand new problem, but a solution that is relatively obvious to everyone competent in the field. Why is the winner of the contest to perfect that obvious solution entitled to claim the solution as his personal property? How is the monopoly on that solution the product of his effort?

I say it isn't, because the ability to come up with it is not scarce. (the reason why no one did it before is that there was no need to solve a problem, because the problem didn't exist) And yet, I keep asking this question, and I keep getting the same answer: it is, because ...answer goes into why it is important to uphold property rights. I'm not disputing property rights, and the ethics behind them.

What exactly is and isn't intellectual property doesn't just rely on that hierarchy of knowledge, it relies on observation. Namely it has to be determined what is the product of one's effort, and what is not. Part of the reason for limits on patents is that eventually someone would come up with that invention on their own, so you can't award the property over the concept to it's first discoverer forever. What if that time, before the next company gets would get there, on their own, is just a month?

I'm asking you for that determination, in the case of a very much conceivable and attainable solution (hence not scarce) to a new problem (i.e. an algorithm that solves some G3 glitch in cell-phone communications), not another lesson in the ethics behind property rights.

Disclosure: I am a former employee of the U.S.P.T.O in the capacity of patent examiner in the period 1999-2001. I examined patents in the field of digital and pulse communications (i.e. cell phones, terrestrial HDTV, WiFi, ADSL, and all kinds of data link layer networking technologies.)

The obvious is not patentable. I quote from the relevant section of U.S. patent law:

35 U.S.C. 103 Conditions for patentability; non-obvious subject matter.

(a)A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.

Note that the standard used is "obvious to a person having ordinary skill in the art" not "obvious to the leaders in the field". One can prove what is obvious to one of ordinary skill in the art because documentation exists in the prior art. In the legal sense, if the prior art doesn't exist then it is non-obvious and the claimed invention passes the standard of 35 U.S.C. 103. "Relatively obvious" is a non-functional standard, either there is prior art or there is not. Translated into the terminology being used here, if there is prior art then that is proof that the claimed invention is not the product of the claiming inventor's effort. It comes down to proof, and objectivity.

Awarding a patent to the first to invent is an objective way to resolve multiple claims to an invention. Another objective way to address this issue is to award a patent on the basis of first to file. First to invent is the US standard, most of the rest of the world uses first to file. I think the US way is better. Either method encourages speedy public dissemination of the state of the art.

I cannot understand any of this "scarcity" talk. Scarcity has nothing to do with anything in this field, except the prices of things after the fact.

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The concept of scarcity is more basic than that of property. For a child to learn that "that is his and this is mine" he must first understand that "I can't use this if he has it."

Scarcity is not the same as "not in my hand" or even "out of reach".

Scarcity exists when the demand for a good is greater than the supply. Hence the concept scarcity is derivative upon goods, supply, and demand, and their relationship. Supply and demand are broad abstractions in economics. The idea that property is caused by the effort of creating a good is far closer to the concrete goods and necessities of life being discussed.

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