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Nortel Patent Sale Gets DoJ Review

Soulskill posted about 3 years ago | from the use-your-powers-for-good dept.

Google 109

gavron writes "The US Department of Justice will review the Nortel patent sale to the entity formed by Apple, Microsoft, and others. This is the same sale that the Canadian authorities declined to review because the $4B+ deal was valued by them at less than $328M. According to a (paywalled) Wall Street Journal report, 'The Justice Department wants to know whether [the consortium] intends to use them defensively to deter patent lawsuits against its members, or offensively against rivals.'"

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Obligatory: (-1)

Anonymous Coward | about 3 years ago | (#36936056)

Value... (1, Insightful)

Anonymous Coward | about 3 years ago | (#36936068)

$328M = $4B+ ? Ain't Conservative math and fiscal responsibility wonderful?

Re:Value... (1)

scottbomb (1290580) | about 3 years ago | (#36936166)

Value is whatever someone will pay in the free market. As such, it's often quite subjective.

Re:Value... (1)

jbengt (874751) | about 3 years ago | (#36939188)

Value is whatever someone will pay in the free market.

:I'm sick of this meme. The value of something is not necessarily the same as its' market valuation. To think otherwise is to imply that the market is infallible. Equating value to "whatever someone will pay in the free market" is an irrational religious faith, not an observed fact.

Re:Value... (1)

fiendy (931228) | about 3 years ago | (#36940890)

Value is whatever someone will pay in the free market.

:I'm sick of this meme. The value of something is not necessarily the same as its' market valuation. To think otherwise is to imply that the market is infallible. Equating value to "whatever someone will pay in the free market" is an irrational religious faith, not an observed fact.

It's not a meme, its economics.

From Wikipedia:
Fair market value (FMV) is an estimate of the market value of a property, based on what a knowledgeable, willing, and unpressured buyer would probably pay to a knowledgeable, willing, and unpressured seller in the market.

If someone is willing to pay a given price - that is its market value. Whether the purchaser has determined the price rationally (as in dot-com valuations) is another matter for argument.

Unfortunately, market distortions like speculators, emotional investors, herd mentality, etc. often result in the 'market value' not being reflective of what a rational, knowledgeable individual should pay. Market value is market value though, if you can find someone to buy your ice in arctic, then that is what it is 'worth'.

Despite evidence,country allows itself to be duped (-1)

Anonymous Coward | about 3 years ago | (#36936222)

It was clear a more than a decade ago that H***er and his cabal of thieves were always about a fire-sale of Canada's assets to, raping of Canada's land by and stripping of Canada's "wealth" by multinational corporation$.

Yet Canadians allowed the bastards to game the system and get into power. Go figure.

Re:Despite evidence,country allows itself to be du (-1)

Anonymous Coward | about 3 years ago | (#36936328)

You know selling something that you value at less than 328 million, for 4 billion, is the exact opposite of a firesale, right?

Obligatory disclaimer: I don't like Harper. I'd rather a Liberal minority government, with the NDP holding the balance of power, and the government not collapsing every 15 months. On balance that mix might come close to my political desires at least some of the time.

But you know. Selling something for way more than you think it's worth? That's actually awesome.

I hope this clarifies things for you: (0)

Anonymous Coward | about 3 years ago | (#36936696)

You know selling something that you value at less than 328 million, for 4 billion, is the exact opposite of a firesale, right?

You have disassociated the statement from its original context. I think that it's obvious from what I said that I was referring to the general environment (with those douchebags in power) in which any national asset (like say, the Tar Sands or INCO) could now be sold to foreigners without more than the mere formality of filling out a few forms.

I also know the meaning of "sellout". Nortel's asset-holders (not the Canadian mis-government or Canadian citizens) did well by selling to foreign multinationals. And Canada has lost more of its technological edge in communications going forward as a result.

FTFA: "the Canadian authorities declined to review because the $4B+ deal was valued by them at less than $328M

Had these assets been properly valued, the Canadian mis-government would have been obligated to review the deal and under the Investment Canada Act [wikipedia.org] and under pressure to nix the deal, just as they were forced by public pressure to do when they were going to allow the sellout of MacDonald-Dettwiler to foreigners. Of course, the Harper bastards were in minority in those days and still had to pretend to give a shit about public opinion.

Re:Value... (5, Funny)

fractalspace (1241106) | about 3 years ago | (#36936294)

That's how much $4B US will convert to Canadian dollars shortly.

Re:Value... (1)

sconeu (64226) | about 3 years ago | (#36937184)

I think it was because Nortel valued them at $328M, so even though MicroApple bid $4B, Canada thought they were worth $328M.

Re:Value... (1)

Fractal Dice (696349) | about 3 years ago | (#36938626)

If Nortel had booked them as a $4B asset, would they have had to go into bankruptcy in the first place?

Re:Value... (1)

fiendy (931228) | about 3 years ago | (#36940858)

If Nortel had booked them as a $4B asset, would they have had to go into bankruptcy in the first place?

It would have made their balance sheet look a whole lot better, but it unlikely that they could have revalued intangibles upwards without a firm plan to dispose of them. (In reality - the patents were a large portion of the company's worth, the result of all the past R&D - selling the patents was the end of the company's cash generating assets.)

I don't know they nitty-gritty accounting details around Nortel, but as is usually the case, I'm guessing poor cash flow and eventual insolvency is what finally took them down. The book value of an intangible asset would not affect that.

That all being said, the unfunded pension of former Nortel employees could have used a bigger piece of those patents. I believe there is some ongoing issues with the amount that the pension fund received when Nortel was finally dissolved and as a result many employees have lost or had their benefits significantly reduced.

Despite evidence,country allows itself to be duped (0)

Anonymous Coward | about 3 years ago | (#36937234)

As I said:

It was clear a more than a decade ago that H***er and his cabal of thieves were always about a fire-sale of Canada's assets to, raping of Canada's land by and stripping of Canada's "wealth" by multinational corporation$.

Yet Canadians allowed the bastards to game the system and get into power. Go figure.

Duh (0)

sprior (249994) | about 3 years ago | (#36936098)

This was is so obvious that even the DOJ couldn't ignore it...

Re:Duh (1)

drinkypoo (153816) | about 3 years ago | (#36936138)

If this goes anything like the last time Microsoft was in front of the DoJ then they'll be found guilty under this president and then pardoned under the next one.

OK, so it's more than Microsoft this time...

Re:Duh (0)

Anonymous Coward | about 3 years ago | (#36936206)

It seems to have worked. They are losing the browser battle, they have lost the mobile market, they are not must-have on the desktop anymore.

Yea, they are still there, but they no longer have the power they did.

A patent must be defended (0, Insightful)

Anonymous Coward | about 3 years ago | (#36936170)

It does not matter if competitor like or not that a patent exist for something they want to market. For it to have any value, the patent must be defended, either defensively or offensively. So asking the question is kind of stupid.

Re:A patent must be defended (1)

Anonymous Coward | about 3 years ago | (#36936234)

You're thinking of trademark law. For a trademark to remain valuable, it must be actively defended.

The big picture? (1)

joeflies (529536) | about 3 years ago | (#36936196)

The Justice Department wants to know whether [the consortium] intends to use them defensively to deter patent lawsuits against its members, or offensively against rivals. Well, it's good that the justice department is taking a closer look at patents. But what about taking a closer look at the IP trolls that are using their patents offensively in both senses of the word (against an opponent and in a disgusting manner).

So if they say it's defensive (1)

rsilvergun (571051) | about 3 years ago | (#36936212)

And then change their mind later, what then? While I'm on the subject, is it just me, or has the mood on Slashdot changed lately? I doubt I'll see one post in defense of these patents, and I don't see as much of the 'ole libertarian bias as I used to. After 11 years of us tech workers getting screwed and having our jobs shipped overseas, maybe we finally got it [rawstory.com] . :).

Libertarians still here (4, Insightful)

SuperKendall (25149) | about 3 years ago | (#36936218)

There are still libertarians here, they are just rarer and drowned out by the noisier people with ideals and no common sense or understanding of how humans work.

Re:Libertarians still here (4, Funny)

vux984 (928602) | about 3 years ago | (#36936226)

There are still libertarians here, they are just rarer and drowned out by the noisier people with ideals and no common sense or understanding of how humans work.

You mean the libertarians?

Re:Libertarians still here (2)

Bing Tsher E (943915) | about 3 years ago | (#36936288)

I think they meant the people like you.

Re:Libertarians still here (0)

MightyMartian (840721) | about 3 years ago | (#36936668)

No society in recorded history has ever functioned on libertarian principles. The closest was the USA, and in under a century it tore itself apart in a brutal civil war brought on in no small part by the inadequacies of its central government.

Re:Libertarians still here (1)

rsilvergun (571051) | about 3 years ago | (#36937050)

There's always Libertarian Paradise [youtube.com] !

Re:Libertarians still here (0)

Anonymous Coward | about 3 years ago | (#36938470)

Libertarians always think other people are the problem, their own behavior being the perfect representation of the way humans should work in a free society.

Wait, what? (0)

zooblethorpe (686757) | about 3 years ago | (#36936236)

There are still libertarians here, they are just rarer and drowned out by the noisier people with ideals and no common sense or understanding of how humans work.

There's a difference?

(ducks and dons asbestos gear)

Re:Libertarians still here (2)

Raenex (947668) | about 3 years ago | (#36938934)

+1 smug and ideological bullshit.

Re:So if they say it's defensive (1)

sjames (1099) | about 3 years ago | (#36936352)

And then change their mind later, what then?

Then they'll be required to pay the additional bribe money for blatant anti-competition and won't get the earlybird discount.

Re:So if they say it's defensive (1)

gl4ss (559668) | about 3 years ago | (#36938024)

apparently best defense is attack anyways.

"defensive" use would be blocking competitors from entering market, of course.

the state of technology manufacturing is ridiculous now, it's much worse than in medieval times with vatican saying what's ok and what's not. sure, everyone has the information how to do and manufacture very, very advanced things. but you can't, because of patents, the new global state religion. same applies to copyright.

even if both of those were thrown into garbage bin, people would still create music and still create new things to sell. you know why? because they got nothing better to do - which is what makes the state of things being what they are even more sad. the very sad thing about these patents is that they don't even describe how technically to do the things they patent! so the whole good for all mankind point of the patents is thrown away.

Re:So if they say it's defensive (0)

Anonymous Coward | about 3 years ago | (#36939394)

Can you explain why libertarians would defend these patents, the current patent system, or even the very idea of a government-managed intellectual property system of laws?
My understanding is that most libertarians take a more anarchic view on intellectual property - as "stealing" intellectual property doesn't actually infringe on anyone else's liberties (kind of the libertarian core principle).

Re:So if they say it's defensive (0)

Anonymous Coward | about 3 years ago | (#36940764)

Screwed? Software engineers making $100,000+ while the average guy on the street is getting laid off, thrown out of his home? Server admins averaging $50-90,000. Now where'd I leave my violin.

So one intent is better than another? (5, Interesting)

Karhgath (312043) | about 3 years ago | (#36936216)

How are either offensive or defensive patents better than the other really? They both make a joke of the patent system. The question should be: do they intend to use them to innovate or not? Isn't that the reason we have patents?

Buying defensive patents is, IMHO, worse than buying submarine patents and suing someone. I mean business-wise. You are spending millions to buy something that will not even help you make money or be more profitable. Use that to do R&D and innovate. Don't they have shareholders? At least patent trolls have a clear business plan...

This is the (corporate) cold war all over again: My arsenal is bigger than yours!

At least there's a silver lining there if we get to the state of Mutually Assured Destruction: they will stop attacking each others with patents and we will move on with our lives. Or so we can hope...

Re:So one intent is better than another? (1)

Anonymous Coward | about 3 years ago | (#36936272)

At least there's a silver lining there if we get to the state of Mutually Assured Destruction: they will stop attacking each others with patents and we will move on with our lives. Or so we can hope...

Your hope is empty. You can't sue a troll as the troll has no products to infringe on your "defensive" patents.

Also "barrier to entry". Whilst MAD may prevent the likes of Google and Microsoft from suing each other, it won't stop them from suing new startup companies who haven't got defensive patents (no cash to burn on frivolous bullshit). Yay for the tool which "encourages science and the useful arts" forming an anti-innovation death wall against new competitors.

Captcha: unsolved. Poignant.

Re:So one intent is better than another? (2)

Bing Tsher E (943915) | about 3 years ago | (#36936300)

No, if they get to the state of Mutually Assured Destruction, then the (non-Military) Industrial Complexes of both sides will heavily tax us all to keep up the parity.

These are fricking lawyers we are talking about, after all. All a lawyer really is is a private-sector politician.

Re:So one intent is better than another? (2)

nedlohs (1335013) | about 3 years ago | (#36936314)

And spending money to secure your computers is silly too right? You are spending money to buy something that will not even help you make money or be more profitable... Worked well for Sony after all.

Re:So one intent is better than another? (1)

Runaway1956 (1322357) | about 3 years ago | (#36936716)

Actually, the answer to the question is "YES!"

Let's imagine that you had a pretty secure operating system, to start with. And, that you employed "best practices" in deployment and operation of that operating system. Further, you employ "best practices" in your networking design, and in the operation of that network. We'll go one step further, and actually educate the users about the dangers of phishing, spearphishing, and the dangers of running untrusted executables, while at the same time setting and enforcing strict filtering rules on the network.

You will have utilized your IT department to it's fullest potential, at this point - without spending money on 3rd party "solutions" to security problems.

It's silly to purchase licenses for antivirus and other security solutions, when you can just upgrade to a Unix-like to start with.

Re:So one intent is better than another? (1)

nedlohs (1335013) | about 3 years ago | (#36936856)

But you're spending money on educating those users, which is money that isn't helping you make money or to be more profitable.

Hiring the more expensive sysadmin instead of the kid just out of high school to run those uniz machines is also spending money which isn't helping you make money or to be more profitable. Same with the programmers. Sure, sure the cheap ones will screw up and somebody might hack in and steal hundreds of millions of credit cards numbers, names, and addresses; then again the more expensive ones don't provide any guarantees either. So yet more money, not helping you make money or to be more profitable.

Re:So one intent is better than another? (1)

Karhgath (312043) | about 3 years ago | (#36938668)

It's not silly, but then again you just don't BUY computer security (especially at $4B+), you spend resources to implement and develop it. You can follow that spending, compare it to profit, take decision (like decrease funding) and audit the effectiveness. You are able to put a "value" on it. There are profit centers in business, but also cost centers (regulations, security, support, etc.) so this isn't new.

You cannot manage $4B+ of defensive patents. You put that in your spending column, and then they'll have to make it go away. You cannot put a real value on it except the $4B+ you spent.

Then the only way to really make something out of it is... to sell it? You're gonna sell one or more defensive patent to your competitor? Of course not. What are your other options? Oh right, use it offensively! That's why I find it silly.

I am also not saying that trying to buy a patent that you know you infringe upon (instead of licensing it) isn't good business. This is an effective protection. Buying a large portfolio of "defensive" patents is still silly.

(I am aware not just one company paid the full price tag, but that's beside the point.)

Re:So one intent is better than another? (1)

Hotweed Music (2017854) | about 3 years ago | (#36936334)

Once they get MAD, any smaller businesses would be unable to create anything without violating a patent >.>

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36938958)

Once they get MAD, any smaller businesses would be unable to create anything without violating a patent >.> in the USA or Japan

FTFY.

Re:So one intent is better than another? (3)

artor3 (1344997) | about 3 years ago | (#36936370)

Yes, everyone agrees that the patent system as it currently exists is insane. But it is what it is. Ignoring that reality and not stocking up on defensive patents is foolish.

Guns exist. Buying guns to hurt people is bad. Buying guns to protect people from bad guys with guns is okay. It would be nice if guns didn't exist at all, but they do, so we have to deal with it.

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36936704)

Guns exist. Buying guns to hurt people is bad. Buying guns to protect people from bad guys with guns is okay. It would be nice if guns didn't exist at all, but they do, so we have to deal with it.

Bullshit! "Buying guns to protect people from bad guys with guns" IS buying guns to hurt people -- specifically to hurt "bad guys with guns".

Amusingly, your bullshittery about guns obscures the accuracy of the analogy:
Guns are good for sending bullets through other people, but worthless at stopping bullets.
Patents grant a right to stop other people from using an invention, but no right to use it yourself.

Even the exceptions mirror nicely:
A gun may stop or deflect a bullet if you get so insanely lucky that the incoming bullet hits the exact location where the gun is; in this case it's not functioning as a gun, just as a piece of metal.
  A patent may protect your right to an invention if you get so insanely lucky that the incoming patent covers the exact same invention; in this case it's not functioning as a patent, just a prior-art description of the contested invention.

Just like guns, patents are incapable of effective "defensive" use -- but handy enough for a counteroffense.

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36936732)

Probably better off with a good insurance policy than a gun :P

Re:So one intent is better than another? (1)

artor3 (1344997) | about 3 years ago | (#36936870)

Man, you are utterly oblivious to the real world.

Guns can stop people with guns. I can't believe I even have to explain this, but if you shoot someone, they can't shoot back any more. If a group decides they want to attack your town, then your town will use guns to defend itself. If it did not, it would be conquered by people with guns.

Likewise, patents can stop people with patents. I'm surprised to be explaining this too, but if your company gets sued for patent infringement, the typical defense is to find a patent of your own that the aggressor is infringing on. At that point, you make some cross-licensing deal and call it a day. Without defensive patents, you're screwed.

You may wish for a world with no guns. You may also with for a world with no patents. But both exist, and you need to use them to defend yourself against them. And before you come back and howl about how you don't own a gun, let me remind you that the people protecting you (cops, soldiers) do.

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36937898)

Sorry, guns the the hands of any one that has no official government supervised reason is insane.
The US has statistics that clearly demonstrate that having guns so readily available leads to unwanted results.

Yes in the early days when we killed animals to live, weapons like guns where needed. Today they are not.
And to a degree, the patent system has fallen down in the same way.
There is NO reason to have a gun in a big city if no one else has one.

The patent system itself was set up to protect those people who invested in ideas. Its not working that way for software patents, and as such, should not apply.

It is basically getting to the stage that it is simply not worth ivovating as the bug patent ownering companies will simply F-U-Up if you get anywhere. So why bother.

Society as a hole is going to have to do something about this eventually. And I am personally surprised how quickly recent developments and court room behavior on patents is really making this apparent. Its why these big powerful companes have been trying hard to keep this out of the courts.
Once the governments of may companies see how these patents are bing used to undermined their countries. I expect we will get some countries announce they no longer support software patents.

That will be an interesting day.

Re:So one intent is better than another? (2)

Agripa (139780) | about 3 years ago | (#36938162)

Sorry, guns the the hands of any one that has no official government supervised reason is insane.
The US has statistics that clearly demonstrate that having guns so readily available leads to unwanted results.

The US has statistics that clearly demonstrate that having knives so readily available leads to unwanted results. How does the availability of firearms lead to a proportionally high statistic for knife assaults and murders?

Except (1)

gr8_phk (621180) | about 3 years ago | (#36938888)

Yes, everyone agrees that the patent system as it currently exists is insane. But it is what it is. Ignoring that reality and not stocking up on defensive patents is foolish.

Pooling patents does not give you increased defence. In fact, having them in a 3rd party company is even weaker defensively than holding your own. The only plausible explanations are joint licensing of the lot - like H-264, or to make offensive strikes like MPEG LA was trying to do against WebM. I don't see the commonality between the companies and patents to support the former.

Re:So one intent is better than another? (4, Insightful)

darkmeridian (119044) | about 3 years ago | (#36936378)

Unless you are Google, which is responsible for the Android operating system, which is hated by Apple. If you don't have defensive patents, you are going to get sued into oblivion. Hell, the ITC might even rule that your products cannot be shipped into the United States because of infringement. I mean, Apple currently has HTC over a barrel. Do you think that HTC shareholders wished they had a few defensive patents to use against the iPhone?

The law might suck, but businessmen have to play by the law.

Re:So one intent is better than another? (1)

zoffdino (848658) | about 3 years ago | (#36936584)

Disclaimer: I own Apple share. That's because HTC actually copied more than a few things from Apple. Ever notice that since the iPhone came out, virtually any smart phone looks like a rectangular block with an edge-to-edge screen. You can scream that Apple is not the first to invent format, but they catapulted it to mainstream recognition. On the side, you need to understand Steve Job's painful lesson in patents: if you license them, or don't defend them, they get stolen without remorse, aka. Microsoft Windows. Apple has become much more of a patent bully lately, but they are far from the patent trolls who knock on their doors frequently.

Re:So one intent is better than another? (1)

Anthony Mouse (1927662) | about 3 years ago | (#36936640)

a rectangular block with an edge-to-edge screen

This is just ridiculous.

Let's say that you want to design a phone with the following design consideration: It should have a large screen, but the phone itself should otherwise be as small as possible. What do you imagine it would look like, if not that?

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36936690)

I guess the makers of all LCD, plasma, and rear projection televisions/monitors (basically everything but the CRT) copied Apple as well?
An example...
My eMachine 20in LCD and my 23inch HP LCD has an edge that is 1/2 inch thick. That is much smaller of an edge percentage than any smartphone. Apple copied LCD makers!

Re:So one intent is better than another? (1)

pieterh (196118) | about 3 years ago | (#36936746)

First, design patents are not the same as conventional patents. Second, Apple copied their iPhone look and feel from LG. Third, such copying happens all the time and is a normal and desirable part of the process of improving products. Fourth, HTC were the first significant smartphone producer, thanks mainly to their deal with Microsoft and the Sendo affair. They didn't patent heavily because they competed by producing better products, not paying lawyers to claim ownership of every possible random idea. Fifth, Apple are clearly moving to patent attacks as they lose their ability to innovate. Sixth, I sold my Apple shares and if I owned any I'd sell them now. Because seven, Apple are exactly where Nokia were five years ago, replacing innovation with patents and protectionism. Oh, and eight, nine, and ten, the key ideas that allowed Apple to create such nice touchscreen UIs were all patented 20+ years ago and it was only with the expiry of those patents that Apple was able to develop decent touch screen UIs. Copied, copied, copied. And that's normal, natural, desirable.

Re:So one intent is better than another? (1)

nedlohs (1335013) | about 3 years ago | (#36936938)

What other form factor is there once you decide to use a touch screen for your input device? Why would you make the device bigger than the screen, given it's designed to be portable? Why would you make the device any other shape then the shape of the LCD touch screen panel you are using? Why would you spend a fortune more on a non-standard LCD shape?

And of course the HTC Touch launched 25 days before the iPhone.

Re:So one intent is better than another? (0)

Anonymous Coward | about 3 years ago | (#36937016)

And the lock screen shortcuts won't be copied in their next version. And Android's notification bar isn't copied either.

Again, these patent lawsuits are stupid.

Re:So one intent is better than another? (1)

JAlexoi (1085785) | about 3 years ago | (#36938242)

That's because HTC actually copied more than a few things from Apple.

And Apple does not copy at all? Hello the hypocrisy of calling 2011 the year of copycats and then turning around an copying everyone else in iOS5....

rectangular block with an edge-to-edge screen

Why isn't iPhone like that? The bezel is HUGE! compared to most phones on the market.

I can see that Apple has a case of copying the looks against Samsung; But HTC came into the US market with different phones and caters to a different market than Apple.(Apple sells phones to customers, shoving the carriers aside. While HTC makes phones that fit the carriers branding and marketing...)

Re:So one intent is better than another? (1)

Anonymous Coward | about 3 years ago | (#36936418)

It is not about patent law... This particular DOJ is much more about Department Of and less about Justice - at the end of the day approval of the deal will depend on how much protection money gets paid.

Re:So one intent is better than another? (3, Informative)

Asic Eng (193332) | about 3 years ago | (#36936466)

Well, given that innovation usually means to build new concepts on top of older ideas, or to extent older ideas - innovation means you'll have to defend yourself against other's patents.

Nobody is using actual patent *texts* in order to innovate though:

  • Patents are basically unreadable for technical people, they are legal not technical documents. If something is actually valuable you've heard about it through other sources.
  • Patents are usually trivial, to read through the patent document takes more time than to come up with an equal or better solution.
  • Patents are usually too old. By the time they are actually granted the methods described in them have been in common use for years.
  • Reading patent literature is dangerous - if you violate a patent knowing that it existed, then your fine could turn out much higher. If you have read about an idea before, you may well use it when encountering a suitable problem - even if you don't remember where or that you read it.

Regarding "Mutually Assured Destruction" - that can only work if there are two parties. If you have hundreds or thousands of parties involved, it's impossible that they could all be balanced against each other. In this case the patent portfolio prevents newcomers from entering the market, so it's very one-sided. And of course a patent portfolio provides virtually no defense against a company which doesn't produce anything - e.g. a law firm which buys patents.

Re:So one intent is better than another? (1)

Karhgath (312043) | about 3 years ago | (#36938780)

I have to say that, after waking up this morning, I realize my point about innovation is flawed. You cannot innovate on top of a patent, you are absolutely right. You can try to make something covered by a patent differently (and innovate in parallel) but then again, you do not even have to own the patent for that.

The rest of my point, that defensive patents are silly, is still valid. There's one kind of patent: offensive. You want to make money out of it (either by buying a patent you know you infringe upon or sue someone infringing). You cannot innovate with it (if you got the patent yourself you already innovated) and cannot retaliate against a patent troll since they don't have any products. That doesn't leave much "defensive" actions.

Re:So one intent is better than another? (1)

Anthony Mouse (1927662) | about 3 years ago | (#36936586)

How are either offensive or defensive patents better than the other really?

The thing that amazes me is that people don't seem to understand what that even means. A patent is, as the analogy goes, a nuclear weapon. It is not a missile defense shield. Its defensive use exists only in the sense that having it will cause your competitors to fear your retaliation if they attack you. It remains the case that you can either assert it or not, and taking the option off the table would make the patent worthless defensively as well as offensively.

More importantly, the idea of using an inherently offensive weapon defensively is that it will avoid the war in the first instance. They've already filed the lawsuits. If you are already waging the war, a weapon can hardly serve as a deterrent. At best it's the threat of another attack hanging over settlement negotiations.

All of this seems like asking the wrong question. It seems clear to me that their goal in buying these patents is not to shore up their patent portfolios, which were already sufficient and in any event can't serve as a deterrent to a war already being fought. And I'm not at all sure they even necessarily wanted use these specific patents offensively. The purpose was rather to deny Google the means to defend Android from their existing attacks.

Re:So one intent is better than another? (1)

Runaway1956 (1322357) | about 3 years ago | (#36936698)

Alright - I'm running some theories and scenarios through my head, trying to make sense of your statement. I'm not arguing, just asking.

How do defensive patent portfolios hurt innovation? Let's say that someone like Google makes it clear that they are holding a nice bag of patents "Just in case". Captain Nemo* manages to incorporate a patent or more into a new product to help him locate great whites more reliably. Nemo even makes arrangements with some small factory to produce these things, and they start marketing a few hundred units annually. At some point Nemo probably SHOULD HAVE contacted Google, and told Google that he desires a license, and Google would have made some kind of an offer - probably free, or "A dollar and other considerations".

If it's known that the patent holder is only building a portfolio for defense against patent trolls, I can't see that as a "bad thing", in and of itself.

*Please don't ask what Nemo, Great Whites, and technology have to do with each other. Maybe I've read that stupid sharks with laser beams to many times on /. ?

Re:So one intent is better than another? (1)

Karhgath (312043) | about 3 years ago | (#36938726)

Defensive patents do not hurt innovation because... well, they don't exist. That's kind of the point. Defensive patents makes no sense by definition. A patent is, in and of itself, offensive: you use it to make money out of someone who infringe or you prevent someone from using your ideas.

In this case, they are buying it either to sue Google, or prevent Google from defending against other legal actions because they do not have a big enough "arsenal" to retaliate. How can that be defensive?

Thing is, patent trolls are inherently a product of the patent system, they realized they don't need an actual product or the means to produce it to make money. (I'm not gonna be debating the state of the patent system here, that's another subject)

What you need to realize with them is that you cannot defend against a patent troll with "defensive" patents because... well.... they do not have any products. They don't care how much patents you have. So what are those "defensive" patents defending you against then?

Are you starting to understand how silly it is to name patents "defensive"?

Re:So one intent is better than another? (1)

sprior (249994) | about 3 years ago | (#36937112)

There's one thing about one company buying a patent to use it defensively. It's kinda another situation when every company but one enters into an agreement with each other for the express purpose of keeping patents away from just one of their collective competitors. That sounds to me like collusion.

privacy, even for fat-cats (1)

eyenot (102141) | about 3 years ago | (#36936270)

even though they're a bunch of greedy, fat-cat hypocrites, liars, and other sorts of assholes, i believe they should have the right to just say: "screw you, no, we're not going to court unless we've been shown to have already broken some kind of law. the answer is we're using them PRIVATELY, for WHATEVER THE FUCK WE WANT.'

Re:privacy, even for fat-cats (0)

Anonymous Coward | about 3 years ago | (#36936408)

so your willing to be controlled and over pay for everything you and your family do in your lives You seriously need to read what Mac are up to, read this report then tell me that they should screw you we're using them PRIVATELY, for WHATEVER THE FUCK WE WANT.'

now read on (https://www.eff.org/deeplinks/2010/08/steve-jobs-watching-you-apple-seeking-patent-0)

Re:privacy, even for fat-cats (1)

rohan972 (880586) | about 3 years ago | (#36936414)

How do we show them to have broken a law without going to court?

google ip theft (2, Insightful)

kiwirob (588600) | about 3 years ago | (#36936308)

The end to Google's IP theft is, known as Andriod is coming. Whether you like it or not there are 1000's of patents covering aspects of Andriod which Google knowingly ignored when it released the software as Open Source.

Google is a blatant IP theft and idiots who have fallen for their "open" agenda are just pawns. If Google was really Open it would make available it's Search Engine, Page Rank patents and software for everybody to use. It doesn't do that because it is EVIL and seeks to commoditize the Smart Phone and Tablet OS with free and open source Andriod software so it can push it's search engine and web apps to datamine private personal data to display adverts to the masses.

Google and Andriod are only interested in your personal information to make money selling advertising to all their users. This IS NOT the promotion of a free and open source ideals. It's about making sure Microsoft and Apple do not completely take over mobile computing operating systems and marginalize Google near monopoly on Internet advertising.

Re:google ip theft (0)

leoplan2 (2064520) | about 3 years ago | (#36936432)

another FUD and anti-competition believer... *sigh*

Re:google ip theft (2)

kiwirob (588600) | about 3 years ago | (#36936532)

Time to smell the coffee dude. Google has a monopoly in internet search and contextual advertising and is using the FOSS community to promote Andriod and try maintain relevance in the mobile computing space. The original Andriod prototypes where Blackberry rip-offs then while Eric Schmidt was on Apple board he saw ripped off their iPhone concept and re-engineered Andriod to use a touch interface like Apple was working on. They then ignored Sun's licensing offers for Java and all other IP related issues then promptly open sourced Andriod without indemnifying users and have hung out HTC, Motorola and all the other Andriod produces out to dry.

Google have done the same thing with the WebM video codec. Release software they know violates other people IP to the FOSS community and wait until the users of the software they release get sued.

They do not have a track record for respecting other peoples IP rights. They have even sues a small independent music label so they can continue to make money selling advertising to people search for illegal music downloads! http://www.reuters.com/article/2010/05/06/us-media-google-idUSTRE6450RP20100506 [reuters.com] . So it is clear Google doesn't give a dam about other people IP rights, all they care about it selling adverts and making money.

If you believe that people should respect the GPL and not steal open source software for closed source projects then you must believe in the principal of IP rights. The GPL only works if people respect the IP rights and choices of the original IP creators. Believing that FOSS software IP rights should be respected but everybody else's rights can be ignored is hypocrisy.

Re:google ip theft (1)

Anthony Mouse (1927662) | about 3 years ago | (#36939414)

Your entire post is wrong because you're confusing copyright (which the GPL uses) with software patents (which are the things that Google -- and everyone else -- is violating, because it is impossible to make any nontrivial software without doing so).

Re:google ip theft (1)

kiwirob (588600) | about 3 years ago | (#36936600)

By the way it is not "competition" when Google gives Andriod away for FREE when there is clearly a significant value proposition for smart phone OEM. Google is clearly "dumping" their software on the market for FREE in order to extend their Internet Search and Advertising monopoly. There are national and international laws against this illegal practice which Google seems to have weaseled their way around. http://en.wikipedia.org/wiki/Dumping_(pricing_policy) [wikipedia.org]

Google know that Andriod is not FREE because of the significant IP rights of others that it violates. Ignoring existing laws and treaties to pursue your own "for profit" agenda is exactly what Microsoft used to do, Google is no better!

If Google truly wanted Patent reform and the promotion of FOSS they should not have been prepared to pay $4B for the Nortel patents. They should have just spent the $4B on a grass roots campaign to lobby the government to reform the broken patent system. But no, they where going to spend $4B continuing to take advantage of the broken patent system for their own advantage.

Re:google ip theft (-1, Redundant)

pieterh (196118) | about 3 years ago | (#36936780)

Where are mod points, and $4B, just when I needed them.

I really want to mod you down to -1 for writing 'free' in capitals three times.

Also, you're a troll.

Re:google ip theft (1)

kiwirob (588600) | about 3 years ago | (#36937058)

Everybody knows you are not supposed to feed trolls!!

But I disagree. The purpose of a troll is to write comments that will incite anger and inflamed responses. This is not my purpose. I have my own individual beliefs that Google is becoming one of the most evil companies out there, which I am wanting to promote. If you have a different opinion and actually believe Google is a genuine nice guy I feel sorry for you.

There is more and more mounting evidence that Google has major privacy violation issues. Take the Do Not Track feature that all major browsers apart from Chrome are supporting http://www.wired.com/epicenter/2011/04/chrome-do-not-track/ [wired.com]

Google is not about mutual advantages between itself and the FOSS community. Google is about making money selling advertising and attacking any and all companies who might stand in the way of their prized revenue stream. They use FOSS to destabilize who technology sectors so their advertising tentacles can spread like a virus, unabated. They have no regard for personal privacy and no regard for obeying laws in large numbers of countries throughout the world. They are one very scary company, to which people need to open their eyes and wake up to. If Google is not answerable to the users personal privacy and they are not answerable to sovereign laws regarding to IP rights, just who the hell are they answerable to?

Re:google ip theft (0)

Anonymous Coward | about 3 years ago | (#36937944)

The whole Do Not Track feature is just a nice idea and nothing more. If websites that benefit from tracking you can ignore that header, what good is it then?

I suggest you actually read the second page of that same article you linked...

Re:google ip theft (0)

Anonymous Coward | about 3 years ago | (#36936436)

They don't have to publish their own software any more than you are. They also don't sell it. Lease it a little, but I haven't seen anything of the "google boxes" in several years, so they may not even be leasing it.

MS, on the other hand, forces people to use their stuff by coercion and advertising kickbacks. But otherwise they act like the usual patent troll.

Apple, at least, makes nice things to sell. They have now added patent troll to their operation.

Re:google ip theft (1)

kiwirob (588600) | about 3 years ago | (#36936558)

Google do not release as open source any software used for their core business of generating search results and displaying contextual advertising. They happily buy up small software projects like Andriod and WebM which operate in markets that other companies make their livings selling software and release software with known IP violations trying to undercut and undermine other people business models, with the sole purpose of promoting their own "for profit" advertising ambitions.

If Google truly believed in FOSS they would release their Page Rank search algo for free to create competition in the search listing market. They don't want to do this and hurt their core business. But they will happy disrupt the Smartphone market and wipe billions of dollars of value off a company like Research in Motion and their Blackberry franchise by attempting to commoditize smartphone OS's so they can sell more advertising. Google is the new Microsoft, they are pure EVIL!!

Re:google ip theft (0)

Anonymous Coward | about 3 years ago | (#36937174)

Hey, it's the mobile companies' own faults for being greedy. Google wants to protect it's core ad selling business. Any closed application market on the platform can strong-arm Google (and any other ad business) completely out of the platform. How would you suggest avoiding being strong-armed out of the market without making your own platform (and making sure it's widely adopted)

Re:google ip theft (1)

kiwirob (588600) | about 3 years ago | (#36937280)

How exactly is it the mobile companies fault for being greedy? Companies like Research in Motion, Nokia, Samsung, Sony, Apple, HTC all design and manufacture phones for people to buy via a competitive market place. Google tried to sell their own phone the Nexus One, but failed in the market place and on July 16, 2010 pulled the product from the market. http://edition.cnn.com/2010/TECH/mobile/07/19/nexus.one.discontinued/index.html?iref=NS1#fbid=nPeDbHV_wpr [cnn.com]

The fact is Google could not compete even with their own phone. But they continue to develop and promote Android even while the majority of companies actually using Google's software are being sued for violating other companies IP. Google clearly know there are major legal issues with Andriod, but choose to ignore these issues and leave them to the OEM partners to sort out.

With the tens of Billions of cash Google is sitting on they could negotiate licenses with Nokia, Microsoft, Apple, Research in Motion and the other major holders of IP rights in the smartphone space. The fact they are aware of the problems and do nothing about it when clearly they can is an abuse of Corporate citizenship.

If you or I went to the local Kmart and stole products from the shelf without paying for them we would go to jail. But it's "ok" for Google to steal other companies IP, open source the code, give it away free on the condition Andriod OEM use "official" Google web apps (kick backs on advertising revenue) then claim no harm no foul. How can this be right? It's not even legal!

Re:google ip theft (1)

Ironhandx (1762146) | about 3 years ago | (#36939044)

The problem is that Google wants to fight most of these.

There are a large number of patents that need to be invalidated and you'll notice that no one is going after good directly, even though they manufactured their own phone.

Thats because Google as a company wants patent reform. It wants these things to be brought into a court of law where they can bring lawyers to bear and actually do some good.

Now, its not all altruistic on Googles part obviously. They have a massive amount of software developers etc employed and invalidating a bunch of software patents can only help their cause in being able to invent and innovate and do it better than the other guy. Most of the markets they want to get into are kludged to hell with software patents that are going to cost them a fortune to license and effectively act as a barrier to entry.

Ex: Oracle. They probably could have paid them off relatively cheaply at the beginning of their spat. Instead Google took them to court and is attempting to educate the judge enough to get a lot of the patents reviewed and nullified. So far with mixed results but they are having some success on that front. They probably knew going in that they would lose the battle, but invalidating a bunch of software patents from one of the biggest software companies out there is a good blow struck in the war.

Re:google ip theft (1)

codepunk (167897) | about 3 years ago | (#36936662)

Actually where google really screwed themselves is using java in it in the first place. Android will be forever playing performance catch up not to mention the patent issues surrounding it.

Re:google ip theft (0)

Anonymous Coward | about 3 years ago | (#36936866)

You're an idiot if you don't understand why they used Java/Dalvik.

Re:google ip theft (1)

Thantik (1207112) | about 3 years ago | (#36937088)

The java performance myth disappeared long ago dude.

Re:google ip theft (1)

JAlexoi (1085785) | about 3 years ago | (#36938272)

IP theft(a.k.a plagiarism) and patent infringement are not the same thing. If you had written any sizeable amount of software, I bet you had infringed on at least 1000 patents... That is the ridiculous beauty of it.

This whole patent mess could be averted if (1)

etymxris (121288) | about 3 years ago | (#36936382)

We just made independent invention an absolute defense against patent infringement. If your idea is truly innovative then there should be little risk to someone independently inventing it.

Re:This whole patent mess could be averted if (1)

sconeu (64226) | about 3 years ago | (#36937194)

Mod parent up.

Re:This whole patent mess could be averted if (1)

kiwirob (588600) | about 3 years ago | (#36937302)

Yes I agree with you there. But independent invention clearly can not be somebody purchasing your product, looking how it works, copy your products features then claim independent invention.

Those stupid Ecommerce patents for shopping carts etc. and business process patents which follow the model, (well known business process) "on the Internet" are clearly garbage.

What about something like the bounce you get when you scroll an iPhone to the bottom of a web page? If it was granted a patent, which I think from memory it did, should Android be able to just copy it because its a nice feature or should that be an example of something that somebody should have to lisence?

Come on you can trust Apple/Microsoft (0)

Billly Gates (198444) | about 3 years ago | (#36936470)

It is not like Apple would ever sue someone to stop a product that might compete with the iphone. That is just paranoid and silly

Laws can be productive or unproductive (1)

I_Voter (987579) | about 3 years ago | (#36936542)

Corporate Competition:

I demand Zillions for purchasing patents. Not a cent for debt relief and no taxes. This is war and we must be productive to achieve victory!

Citizen's Political Power in the U.S.
http://i-voter.tripod.com/ [tripod.com]

Not suprising (1)

protektor (63514) | about 3 years ago | (#36936634)

I called it as soon as I heard the deal was closed and it wasn't Google who won the patents. There is no way that Google or the government was going to let that go unchallenged.

Defensive *IS* offensive in business (2)

erroneus (253617) | about 3 years ago | (#36936636)

In the context of business one must "defend or lose it." So asking if they plan to become patent trolls will not give the answer they seek. Further, even if they say "no, we will be nice" there is nothing to stop them from changing their position in some way or even better, to sell patents to go trolling to another shell to go about trolling. Just asking them in advance if what their intentions are is just about useless.

If we want the patent and other IP systems to work the way they should, copyright, patent and trademark ownership should not be transferable away from the original creator. And in the case of a corporation, I think rights should remain with the original creators as well which is to say the people employed by the company at the time who were involved in the creation. This would result in the instant death of patent trolling and the instant reform of the copyright industry. It would force companies to be loyal to their employees once and for all instead of treating them as disposable peons while they reap the benefits for the life of the corporation + XX years. And the copyright industry, unable to rape artists now and in the future, will have to play nicely with the talent for a change.

If the patent system is supposed to benefit the inventors, then restore it to suit that purpose. If the copyright system is supposed to benefit the artists, then restore it to suit that purpose. If not, then I would rather the system and the people operating it stop lying to the people about what it is and what it is for.

Re:Defensive *IS* offensive in business (0)

Anonymous Coward | about 3 years ago | (#36936718)

In the context of business one must "defend or lose it."

Fail...
You are confusing patents with trademarks.

Some of your ideas are good but almost impossible to write them up in a fair manner. In my opinion, an actual product should be created and possibly in a workable prototype of for in a state ready for sale to the public using the concepts in the patent before the patent should be granted. The way things are now, you can take an obvious idea and add with internet access, in a handheld device, or a mobile device to the end of it and suddenly the patent office thinks this idea is something no one would have ever thought of. I was doing one click shopping before Amazon patented the idea for online transactions. I've only clicked "ok" or the "credit button" on a POS terminal when buying something thousands of times.

The only beneficiaries are lawyers (1)

Required Snark (1702878) | about 3 years ago | (#36936706)

The real world cost is a loss to everyone but attorneys. They walk away fat and happy, no matter which side wins.

Meanwhile, the money spent on legal fees is not spent on the following: R&D, manufacturing, hiring, capital equipment purchase, advertising, stock dividends, salaries, stock value increases.

Ultimately, no matter which side prevails, the total wealth generated is less then it should be due to the patent system. Patents were intended to reward innovation. Now all they do is keep high priced litigators in luxury cars.

They also reward companies, not individuals. Even when innovation occurs, it can be crushed though the use of patent law. We use the wrong term in "patent trolls", when it should be "patent leaches". Leaches can kill, and the smaller the target the greater the chance it will be destroyed.

I'm working on software I hope to use for a start up, and I know I have to apply for provisional software patents. I don't want to waste the time, but if I don't someone else can make a patent application and take my work away from me. Even if I do apply, someone with a full time legal staff can plow me under, and my only hope would be to get some major financial backing. At that point I am not doing software, I'm doing patent work. Once again, innovation looses and lawyers win.

Re:The only beneficiaries are lawyers (2)

zippthorne (748122) | about 3 years ago | (#36940474)

Patents, as formed in the US founding documents are intended to reward disclosure. They are a monumental failure at that: they are not written in a language that laymen can understand, and they are usually not even written in a language that an engineer would use...

Frankly, I think it would be quite generous if we allowed patents to exist for five years before pruning: Any patent not quoted or referenced in a scholarly journal or textbook in its field should expire.

Defensive vs.offensive patents (2)

arglebargle_xiv (2212710) | about 3 years ago | (#36936854)

The Justice Department wants to know whether [the consortium] intends to use them defensively to deter patent lawsuits against its members, or offensively against rivals.

As opposed to "innovatively, for the common good".

I don't have access to the paywalled article, but isn't this the DoJ publicly admitting that patents only serve two purposes, neither of which are the ones they're intended to serve?

Eric Schmidt/Obama (1)

Anonymous Coward | about 3 years ago | (#36937204)

Must be nice for Eric Schmidt to have Obama's ear.

Re:Eric Schmidt/Obama (0)

Anonymous Coward | about 3 years ago | (#36937322)

Must be nice for Eric Schmidt to have Obama's ear.

or Obama's genitalia in his mouth for that matter

Offensive illegal? (2)

sunfly (1248694) | about 3 years ago | (#36937286)

Why would they care... is using patents offensively illegal? (not that I think it's right)

Re:Offensive illegal? (1)

wrook (134116) | about 3 years ago | (#36938802)

Likely considering a monopoly position. If you hold a large number of the key patents to a technology, you can effectively shut down all your competition. As bizarre as it sounds, my guess is that buying a monopoly position through buying key patents may be considered unfair competition.

The new way of tech competition (1)

Nichole_knc (790047) | about 3 years ago | (#36938610)

If you cannot out innovate them out litigate them. Apple VS everyone else. "APPLE disgusts me"

Axis of Evil (1)

StormReaver (59959) | about 3 years ago | (#36938664)

This is the Axis of Evil we're talking about. Of course they're going to say, "We would never dream of using these patents offensively -wink, wink-. We would only use them defensively -chuckle, chuckle-.

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