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Against Monopoly

defending the right to innovate

Monopoly corrupts. Absolute monopoly corrupts absolutely.





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P2P competition in video distribution promised

Ars Technica has an intriguing piece today on Bit Torrent's plan to use P2P to reduce or eliminate bandwidth limits and allow the transmission of higher definition streaming video comparable to that on TV link here.

"The new system, called BitTorrent DNA (Delivery Network Accelerator), applies the basic BitTorrent concepts to file downloads and streaming video delivery, but with a twist. Content is at first distributed through a company's normal channels, usually a content delivery network like Akamai or Limelight.

"As the video is streamed to users, though, they begin to cache it locally. The DNA app breaks the video up into bits, and new viewers of the stream will start to draw on peers for data rather than the content provider. BitTorrent estimates that more than half of a company's bandwidth for this sort of streaming can be offloaded onto the P2P network, which is managed and secured by BitTorrent."

Bit Torrent already rents or sells videos but will be joining with content providers to use the new system, thus avoiding the issue of obtaining permission to use copyrighted material.

Bit Torrent's DNA future depends on the quality of its transmissions. But anything that adds to available modes and lowers cost will undoubtedly put pressure on cable, phone, and broadcast companies which tend to be local monopolies. More competition is a happy development.

Unlocking the iPod is legal for individuals

Tim Wu at Slate writes about the legality of unlocking your iPhone link here. He unlocked his after looking into the law and admits it is not a move for the faint of heart. But he adds that Apple would like to convince you that unlocking the phone and moving to a different service provider is illegal and it is not. "The reason is an explicit exemption for personal unlocking issued by the librarian of Congress in 2006. As the librarian wrote, the locks ‘are used by wireless carriers to limit the ability of subscribers to switch to other carriers, a business decision that has nothing whatsoever to do with the interests protected by copyright.'"

Monopolist Apple looks even less on the consumer's side when it issues the warning that installing its software updates may turn you iPhone into a brick. So stay away from any updates. I doubt whether Apple is legally right in issuing destructive updates, but who is going to sue for damages? It is malware of the worst sort, but proving it is not easy.

Best choice-forget about buying Apple gear.

USPTO; Nobody knows the trouble we got

We all know the Patent Office is a mess. "If the agency could shut its doors to catch up on its work, its 5,500 patent examiners would take at least two years to clear the backlog of pending applications link here." Compounding the problem. it has high employee turnover.

But then the story goes off track, when it says, "Keeping up with the demand for patents is critical to the nation's health." Patents are in the constitution to encourage innovation. Perhaps put into practice once, they are now too often used to extend monopoly indefinitely by foreclosing further developments, and using charges of infringement to silence competition. This also ignores the fact that the office depend on the fees paid on applications, and thus has an interest in accepting poorly-based applications.

Instead of real reform, the agency proposes new production quotas for hard-pressed examiners and requiring simplified patent applications. Because examiner turnover is a problem, it already offers "special pay rates" above regular federal scales, recruitment and retention bonuses, flexible work schedules, a telecommuting program and reimbursement for law school. Rearranging the chairs.

Is evolutionary design the key to a future full of inventions?

Here at first sight is a pleasing story, involving evolutionary design, using something called an evolutionary algorithm and computers, giving the researcher a way to design around an existing patent, all based on the idea of biological evolution link here. From where I sit, there doesn't seem to be enough specifics for me to start such designing, but we wouldn't want it to be too easy, because existing patent holders would also set to work and patent all the resulting improvements.

In the end, it doesn't seem to be quite the gee-whiz breakthrough the news story suggests, but hopefully, I'm wrong. It does represent some new tools to make invention and innovation more likely to produce good new products--and to get around those pesky patents that too often fence inventors in.

IBM withdraws "business method" patent application for lack of real content

Incredible as it may seem, IBM has withdrawn a patent application to identify "human-resource work content to outsource offshore of an organization link here." Apparently, they were too ashamed to sustain the application and issued a contrite statement, saying "Here's why we are withdrawing it IBM adopted a new policy a year ago to sharply reduce business method patent filings and instead stress significant technical content in its patents link here. Good for IBM.

The fight goes on but maybe we are beginning to win some big ones.

"Our Album Is the Menu. The Concert Is the Meal"

I had never seen the British magazine Prospect before, but the August issue's cover tag line "Pop Economics: The Rise and Fall of the Recording Industry," caught my attention, so I bought it. Robert Sandall's article "Off the Record" is the best overview of the recorded music industry I have seen.

He discusses how the recording industry has been the co-author of its own demise, and makes a numbers-based case that even legal downloading will not stanch the blood letting. Money fact: In the 1980s, a ticket to a live concert by a star cost the same as a CD. In 2006 a ticket to Madonna's concert at Wembley Arena cost more than double what you would have paid for her whole catalogue.

Big Pharma's Big Kick Backs

According to the Oct. 8 issue of Business Week, drug and medical-device companies give about $19 billion of gifts to doctors annually. Here's the story .

Hey, they gotta do something with those patent-enabled rents besides actual R&D.

Senators Grassley and Kohl want a national registry to record gifts worth more than $25. Why not opt for competition in drug development, starting with abolishing the patent raj?

Amazon's 1-click still clicks with the USPTO

In a cryptic announcement, the USPTO review panelists reviewing an examiner's rejection of Amazon's 1-click patent as obvious, sent it back to the examiner requesting more evidence because it didn't seem obvious to them link here. At first glance, this didn't appear to me to be a very interesting case--but there is a long history to it.

First of all, the patent seems obvious to me--it is simply a macro in which a single key-stroke performs a series of computer functions. The patent, entitled "A Method and System for Placing a Purchase Order Via a Communications Network," was applied for in 1997 and granted two years later link here. A battle started when bookseller Barnes & Noble came up with its own "1-click" ordering system. Amazon sued for infringement and won that fall and won again on appeal. Calls for a boycott were not successful but created a good bit of backlash against software patents. The patent is described in simple terms here.

The real disgrace in this case is that it is still around, ten years later and may still be around ten years from now.

Jury Rules in favor of RIAA - Slams a single mother for $220,000

Unfortunate news that the RIAA has won its first file-sharing trial link here.

Recording Industry vs. The People is still upbeat about a possible appeal link here.

Absurd Interpretation of Fairness

This article condemns Radiohead for ripping off consumers by allowing them to pay what they think is appropriate to download the group's new album. Apparently, some consumer might pay Radiohead money that should rightfully go to the major labels. Read this and laugh. "Will Radiohead leave fans high and dry? It may sound preposterous to accuse the British rockers of gouging their followers. The band is letting them decide how much to pay for a downloaded version of new album "In Rainbows." But early indications suggest that Radiohead's loyal followers are paying too much for the band's seventh disc." "According to a poll conducted by United Kingdom music magazine NME, the average fan appears to be willing to pay $10 for a digital copy. Now, that may not sound like a blow out. It's the going price for most records on Apple's iTunes. And that price, in turn, looks to be about right for a digitally downloaded album." "Consider the economics of the average CD. It retails for about $16 and costs about $6.40 to manufacture, distribute and sell in a store, research outfit Almighty Institute of Music Retail says. These costs are essentially zero when music is sold online. That's why iTunes can charge roughly $10 for a downloaded album." "Radiohead's fitter, happier approach slices out even more cost. The band pulled the ripcord on EMI, so it doesn't have to share profits or help pay the label's overhead. As a well-known band it's also able to take the knives out on marketing and promotion costs, cutting these by as much as two-thirds. Subtract these expenses and Radiohead may be able to distribute an album for as little as $3.40 a copy." "Now, fans may be delighted to pay $10 because they think the album is so good and Radiohead deserves the extra cash. But Radiohead prides itself on its anticorporate and anti-materialistic ethos. To avoid letting down fans, it might be more productive to adopt a no-surprises policy and fix a simple, fair charge for its record." Cyran, Robert, Rob Cox and Mike Verdi. 2007. "What Price a Download? Given the Option to Name Their Own Price for Album, Radiohead Fans Overspend." Wall Street Journal (3 October): p. C 14. link here

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