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Xref: sserve comp.org.eff.talk:9189 comp.unix.bsd:5784 comp.os.mach:2220 misc.int-property:543 comp.sys.mac.advocacy:708 Newsgroups: comp.org.eff.talk,comp.unix.bsd,comp.os.mach,misc.int-property,alt.suit.att-bsdi,comp.sys.mac.advocacy Path: sserve!manuel!munnari.oz.au!sgiblab!spool.mu.edu!wupost!csus.edu!netcom.com!mcgregor From: mcgregor@netcom.com (Scott Mcgregor) Subject: Re: Letter asking for help with Apple from the US VP Message-ID: <v_+pvad.mcgregor@netcom.com> Date: Tue, 29 Sep 92 05:27:09 GMT Organization: Netcom - Online Communication Services (408 241-9760 guest) References: <JTW.92Sep25203600@pmws.lcs.mit.edu> <1992Sep26.163059.24740@rwwa.COM> <29581.Sep2900.20.3792@virtualnews.nyu.edu> Lines: 101 In article <29581.Sep2900.20.3792@virtualnews.nyu.edu> brnstnd@nyu.edu (D. J. Bernstein) writes: >In 1984, Miller and Wegman at IBM invented a compression algorithm often >called MW2. At the same time, independently, Welch at Unisys invented a >compression algorithm often called LZW. Both IBM and Unisys filed for, >and received, patents. Surprise: MW2 and LZW are the same algorithm. >Explain how innovation was encouraged here. Hypothesis: Miller, Wegmen and Welch were all employed at for profit companies who paid them to research in computer science in the hopes of developing algorithms that would solve commercially remunerative problems. Each company hoped that by developing such solutions they would be able to produce products, or license basic technology to other product producers and thus earn revenues allowing it to recoup its development expenses and hopefully to contribute profits to its owners. These company's may have chosen to focus efforts on areas in which patents are possible in the hopes of obtaining a better commercial position than would be possible if they instead just made a copy of some other popular commodity product. If the above hypothesis is correct, innovation is encouraged in the following respects: IBM and Unisys may be able to command better revenues for developing new products than for merely copying existing ones, due to the limited monopolies that patents grant. Their investors (i.e. the purchasers of IBM and Unisys stock) are willing to allow the companies to fund speculative work for the possible higher rewards. Thus funders are incented to bring funding to new development, companies are incented to do that development, and the resultant new products and processes are made widely available to the general public through their creators and licensees. Now, I have no evidence to PROVE this hypothesis. Indeed, I can't think of what would constitute proof. But neither can I see how any evidence presented by Bernstein or others disproves this hypothesis that companys are incented to do new development by the potential value of patent rights, and their investors are willing to allow them because of the potential for higher returns. That constitues a valid explanation of how innovation might be encouraged by patents that is consistant with Bernstein's description of the facts. This is also true in the Storer/Bernstein case. What may be different in that case is that we know that IBM and Unisys were motivated by the possibile advantages of developing products in a patentable area (after all, they also paid the costs to secure patents. We can also conclude the same for Mr. Storer. We don't know if Bernstein or Harspool would have been so incented from the facts presented. Maybe they have other motivations. Maybe they are more philanthropic than for profit companies like IBM and Unisys. So they may not be motivated to innovation by patents. But this not proof that they others weren't motivated by the advantages of a patent. Rather than demonstrating no incentive for innovation, I think the question that Bernstein raises is whether such incentive is necessary. He suggests that because there were multiple inventors it shows that we have too much incentive, or maybe that no incentive was necessary at all. And, because he can speak for his own motivation, we can probably believe him that he would have worked on the compression algorithm he invented even if patents had not been possible. But would Mr. Storer and Mr. Horspool done so? More imporantly, would IBM and Unisys have done so? Might we still not have LZW if there were not sufficient incentives for commercialization. Lastly, Bernstein's view seems to stop at the act of innovation alone, not is widespread use by the general public. Mr. Storer has an incentive to commercialize his invention. Would it be so widely known if Mr. Bernstein had invented it? Clearly IBM and Unisys are in a better position to provide an innovative new product to a large market than an individual like Mr. Bernstein. Perhaps LZW would be widely used only by "hobbyists" and a "hacker elite" rather than being in use in many commercial modems and disk drive compression systems. There are hundreds of valuable freeware, and shareware products in use by many readers that share this fate. Meanwhile the commercial incentives at work incent company's like Lotus, Microsoft, IBM and Unisys to sell many times more copies of 1-2-3, DOS, etc. and a larger public benefits. >Seems to me the public loses out. And we're just talking about one tiny >field of programming here: non-statistical LZ78-like compression. How >many examples are there in other fields? The extent that the public loses out is that it has less competition for certain new products, and can't legally re-engineer their own solution from scratch. The latter disadvantage applies to a small part of the general public--only those with the knowledge, time and motivation to build their own solution. The former is a rejection of the principle of the patent system per se, which causes the public to pay a cost (the result of the limited monopoly) which is supposed to be more than balanced by the general benefit (the EARLIER, and WIDER SPREAD of innovation). Whether this inequation is correct may be true or false in both specific and general cases, and may be limited to a matter of opinion based upon person values. -- Scott L. McGregor mcgregor@netcom.com President tel: 408-985-1824 Prescient Software, Inc. fax: 408-985-1936 3494 Yuba Avenue San Jose, CA 95117