In "The unbound Prometheus" David Landes writes about the historical causes for the industrial revolution in Europe, specifically analyzing the manufacture of cotton in England.
After noting that many inventors "spent more time enforcing their patent rights than earning them", he writes an apropos footnote about the incentives laid by patents:
"A number of writers have laid stress on the incentive effects of patent legislation. I am inclined to doubt its significance. This kind of protection was not new; the basis of the system was laid by the Statute of Monopolies in 1624. [...] At the same time, there was good reason to doubt the efficacy of patents against determined competitors, as numerous inventors learned to their sorrow, and many an entrepreneur placed his reliance on secrecy, rather than law."
One problem with software patents is that the vast majority of innovation happens in the minds of individual programmers, and often goes into products without anyone else in the world being aware. They don't and couldn't be expected to know about all of the thousands of software patents that could read on their innovations, and then negotiate licenses. Imagine how little innovation would happen if it did work like this. But this is to some degree how the system is supposed to work.
Instead, the system works as combination of big businesses using questionable patents and threats of expensive litigation as a tactic to protect their turf from competition, thereby stifling innovation. Others play the patent lottery filing for or purchasing software patents in the hopes to later find a big-time infringer to go after, on innovation that most likely happened without knowledge of their patents and would have happened anyway.
The fashion industry is an excellent example of an industry that has no patents and thrives.
The industry thrives for very few companies. Boutique brands make their money largely by skimming money from extremely wealthy or showy.
If you hear VCs talk about the fashion industry you'll often hear, "It's a brutal business, I don't want to be in it". It's all about rack space. The other issue with fasion is that there's virtually no R&D cost in fashion. Companies like Nike do R&D, but Sketchers does virtually none.
If we couple two large trends... end of SW patents and app stores, the end result is probably a few large partners that copy any hot application and then get profiled in the app store. Word Lens is great, but iLens by Apple is the one that gets all the money due to the fact that its spotlighted in the AppStore.
The thing that I always find somewhat interesting is that computer technology has moved incredibly fast over the past 30 years. Faster than probably any other technology or industry in the world. Yet it happened with patents. If we didn't have patents today would we have perfect AI today or something? The pace of innovation actually seems mighty brisk with our current system.
It wasn't until the early 90's that software was widely considered patentable. Even then it wasn't till the late 90's that software patenting really started to take off. And much of that was by companies who saw patenting more as defensive practice to help defend against patent suits (much as were seeing in many of the smart phone lawsuits). But it is difficult to sit on a big pile of patents and not make some effort to monetize those assets. I think we're just beginning to see the true cost of software patents. Of course for the big companies it's just the cost of doing business, a cost that gets passed on to consumers. But for small companies it is an existential threat, and that could greatly reduce innovation in the US.
Of course there is the risk that bigger companies with more manpower and marketing muscle will copy good ideas from startups. But I think most entrepreneurs would rather fight that fight by being quicker, smarter and listening to the customer, than to fight patent trolls in court. In the first case their will be a winner, and a looser, but generally the public wins. In lawsuits you may win some, or loose some, but in the long run only the lawyers win.
In what other technology or industry can the practitioners carry everything they need for innovation around in their backpacks. If machine shops were so ubiquitous and portable, mechanical engineering patents would be unnecessary too.
Also, software became patentable in 1991 when a lower court overruled US Supreme Court precedent that software for general-purpose computers is not patentable. Some people cite Diamond v. Diehr (1980) as enabling software patents, but that contradicts what the court opinion actually says.
I'm not sure what portability has to do with patents? If anything I'd think the opposite to be true. Patents seem more necessary when the barrier to replicate is low. If I have to build a $500M fab that will take 3 years to build, patents seem less necessary, than if I can simply read your code (or disassmble) and copy your logic in a week (or automate the process to copy your code, but do some semantic preserving changes to not violate copyright law).
You don't need patents to protect a specific implementation - code is copyrightable, and stealing your particular code (or even creating a derivative work like your "semantic-preserving changes" comment suggests) is illegal even without patents.
In order to avoid running afoul of copyright law you'd need to do a vacuum reimplementation based just on the description/specification of the algorithm - all that patents achieve is making such vacuum reimplementation also illegal, and it's up in the air whether that's even a good thing or not.
You don't need patents to protect a specific implementation - code is copyrightable, and stealing your particular code (or even creating a derivative work like your "semantic-preserving changes" comment suggests) is illegal even without patents.
That's how they did it in this case, but the precedent for determining infringement uses filtration, not the process by which you created the implementation (clean room or otherwise).
Of course, if you do walk this close to the line, you probably don't want to leave a paper trail that you're doing so.
If I have to invest $500M and three years to test my hypothesised process improvement, which my competitors can implement with much lower sunk costs if it works, I'm not going to get the funding to do it.
The thing is that patents really only serve patent trolls and BigCos with giant legal departments (and the latter probably wouldn't file many if not for the former). For everyone else, software patents effectively don't exist and haven't existed for a long time.
I suspect your comment on the fashion industry is correct. But, I find this article is well-reasoned. It's lacking in sources and concrete arguments, but is well-reasoned nevertheless.
In particular, I suspect the author's comment on software thriving in spite of software patents is correct. Unfortunately, it's a difficult thing to prove or disprove.
That's a horrible argument. That's like justifying nukes to defend against nukes. In an arms race where the other side will have nukes independent of what you want to do, you have no choice. That's why the Cold War was so dangerous. The overall governing laws of science could not be overturned such that making nukes was impossible, so nukes were made to increase power in war and politics.
Patents are not like nukes in that patents are a legal construct regulated by governments and the legal process. Laws can be abolished and overturned, though not easily. The difference is that laws of nature are impossible to overturn, whereas laws of government are only difficult.
I also find this reason for patents very wrong, but it's the current reality - even good-minded company has to have a briefcase of patents to protect itself.
After noting that many inventors "spent more time enforcing their patent rights than earning them", he writes an apropos footnote about the incentives laid by patents:
"A number of writers have laid stress on the incentive effects of patent legislation. I am inclined to doubt its significance. This kind of protection was not new; the basis of the system was laid by the Statute of Monopolies in 1624. [...] At the same time, there was good reason to doubt the efficacy of patents against determined competitors, as numerous inventors learned to their sorrow, and many an entrepreneur placed his reliance on secrecy, rather than law."
http://books.google.com/books?id=axrD2M9dBE8C&lpg=PP1...