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Date:      Thu, 11 Oct 2001 12:22:05 +0200
From:      Rahul Siddharthan <rsidd@physics.iisc.ernet.in>
To:        Terry Lambert <tlambert2@mindspring.com>
Cc:        cjclark@alum.mit.edu, Salvo Bartolotta <bartequi@neomedia.it>, Ted Mittelstaedt <tedm@toybox.placo.com>, "P. U. (Uli) Kruppa" <root@pukruppa.de>, freebsd-chat@FreeBSD.ORG
Subject:   Re: Use of the UNIX Trademark
Message-ID:  <20011011122205.D17422@lpt.ens.fr>
In-Reply-To: <3BC5592C.1E8734F6@mindspring.com>; from tlambert2@mindspring.com on Thu, Oct 11, 2001 at 01:32:44AM -0700
References:  <000601c15084$87edd360$1401a8c0@tedm.placo.com> <1002663600.3bc36eb096ee5@webmail.neomedia.it> <20011009231343.C387@blossom.cjclark.org> <1002731960.3bc479b899603@webmail.neomedia.it> <20011010140126.M387@blossom.cjclark.org> <20011010233539.G83192@lpt.ens.fr> <3BC53F53.967C60E7@mindspring.com> <20011011095336.A475@lpt.ens.fr> <3BC5592C.1E8734F6@mindspring.com>

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Terry Lambert said on Oct 11, 2001 at 01:32:44:
> 
> You need to check the money trail.  MIT has an absolutely
> *huge* patent portfolio, and gets not an insignificant amount
> of its funding from patent licenses.  Last I heard, it was
> in the tens of billions, and that was 5 years ago.

I'm not sure of the numbers, but in the "boom years" after the war,
universities got much of their funding from the government: some from
the NSF, some from places like NASA.  It was driven by technological
competition with the USSR, and by military desires (the development of
the atomic bomb convinced many that theoretical physics was the way to
go...) but whatever the motivations, it had a good effect, for US
industry in particular.  The funding didn't conflict with the idea
that university research is for the public good and should not be
appropriated for private profit.  Today, that idea is indeed being
questioned more and more, but I'd find it quite distressing if
universities started regarding patent portfolios as more important
than sharing of knowledge.  

> The transistor was never patented; this is because it was
> disclosed more than a year before anyone thought it might
> end up being anything more than a curiosity.  Bell Labs
> has done a lot of that sort of thing.

And you can argue that the benefits have been immense.  Because the
transistor was never patented, it was picked up and played with
everywhere, especially by the Japanese.  Bell Labs didn't really lose
much either: they got a Nobel, fame, etc.  If they had tried to hold
tightly to their invention, they may have got a few royalties, but the
uses to which it was put within the next decade would probably not
have materialised so quickly.

My point of view is this: when a company develops a new innovation, it
*already* has an advantage over its competitors; it can be first to
market, it can strengthen its brand image, it can stay ahead of its
competitors.  However, with strong patent protection, the company can
rest on its patents and try to earn revenues by squeezing the rest of
the world (like Rambus tried, unsuccessfully, to do).  Without patent
protection, it will feel the pressure to continue innovating; but if
it continues innovating, its brand image will only improve.  Most
people will be willing to pay 2 or 3 times as much for Glaxo or Pfizer
than for a generic knockoff.  But if the factor is 200 or 300, rather
than 2 or 3, that's a different matter altogether.  People continued
to buy Intel even though AMD's products were cheaper and performed
better.

Compare with food products: people buy Kelloggs, or Kraft, for the
brand name, not because of superior quality.  There is no patent or
other IP protection for cheese or corn flakes.  

R

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