From: hal@finney.org
Date: Tue Jan 25 2000 - 12:05:27 MST
Lee Daniel Crocker, <lcrocker@mercury.colossus.net>, writes:
> A large percentage of the people on this list are software developers.
> I suspect there are several hundred years experience in the field (I
> account for about 20 of them). Does anyone here really think that
> investment in software companies is due to software patents? I doubt
> it strongly. Software patents are sand in the gears of progress, not
> grease. I think even supporters or agnostics to the idea would agree
> that they played little or no positive role in the industry.
I don't think that investment in software companies is "due to" software
patents, exclusively. But it is can be an important consideration
for investors. A company with a strong intellectual property position
generally has an easier time attracting investors than one whose designs
can be freely copied. Companies usually do play up their IP protection
possibilities in their investment literature.
I got a TiVo for Christmas, and I've been thinking of investing in the
company. Reading the investment boards, patent protection or its absence
is something that comes up fairly often. TiVo claims to have patents
pending, but are they significant? Or will Microsoft be able to waltz
in and put out an identical product? It makes a big difference in the
company's future prospects, which is what drives the investment decision.
Today it is even becoming possible to get patents on the business
model, as "name your own price" priceline.com has done. If you go to
priceline.com and click on "Investor Relations" at the bottom, the very
first sentence of their investor relations page says "Priceline.com is
the patented Internet pricing system that enables consumers to achieve
significant savings by naming their own price for goods and services."
Priceline wouldn't mention patents in the one sentence that prospective
investors are most likely to read, unless they thought it would be
important to investors.
Hal
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