Thursday, 27 December 2012

OnLive Founder and Former CEO Steve Perlman on Fundamental Patents vs. Incremental Patents


OnLive founder and former CEO Steve Perlman made a cameo appearance in an article by The New York Times (NYT) titled The Patent, Used as a Sword. Steve is an outspoken opponent of the America Invents Act and its first-inventor-to-file system. In this piece by the NYT Steve decried how little of influence he and his fellow inventor colleagues have on the decision making of the congress in regard to the patent law as opposed to the large corporations with their huge lobbyist machinery. This piece produced many heated responses, one of them being Steve Perlman himself. The NYT thought it worthwhile to publish an article about Steve's response and opinion on the patent system titled In the High-Tech Patent Wars, an Inventor’s Lament.

Steve laments that it's very important to differentiate between fundamental patents and incremental patents. He doesn't belittle incrementalism as this is 99 percent of what corporate research and development does and it's very important.

In his companies Steve deals with fundamental patents. He knows what each of his patents does, and has never sold one. In stark contrast are the truckloads of patents for minor sub-features in use by the smartphone titans in their clashes. Again Steve thinks that incrementalism is very important for smartphones and says it’s incredible what the smartphone giants achieved.

But, Steve thinks that the big problem is that fundamental patents are lumped together with incremental patents. Since the world is trying to mitigate the over-litigation of incremental patents and patent offices are buried under them, little guys are being steamrolled over. And this is happening with intent as incumbents with a deep vested interest in maintaining the status quo see the screwed-up patent system as a means to disrupt the ability of small start-ups to bring breakthroughs to market.

Steve said that the flawed patent system also played a role in OnLive's recent ABC bankruptcy and the subsequent reorganization. Especially the long granting process for their patents was a huge problem for a small start-up company like OnLive because they had problems attracting investments with no patents to enforce. Though the reportedly flawed management skills of Steve Perlman might also have played a key role in the cloud gaming company's problems.

With the help of the first-inventor-to-file system of the America Invents Act, large corporations are preying on small start-ups, that way getting cheap access to technology invented by small start-ups in years of hard labor, with the people who invented the technology getting next to nothing. By spamming the USPTO with incremental and broad patents, and making use of their courtroom power, large corporations are now stifling innovation even outside their walls, which can't be good for the health of the economy and even more important for the progress of humanity.

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