Does Microsoft's settlement fever signal IP offensive?

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Over Cooked

I like your take on patents favoring the big guys. Someone else (I think: No_Ax_To_Grind) posted a comment that compares IT to the drugs industry which illustrates the same point in a different way.

You both did a better job than I did - and I totally agree with this take, with one exception.

IP is a tradable property, just like any other. Trading IP also has other benefits. If the Patent Office supplies a patent it is often not possible for them to fully test the unique nature of the IP being certified - and many patents appear to be successfully challenged on this basis.

But, if IP is cross-licenced, then this additional agreement stands as evidence that a peer (another highly regarded IT firm) has recognised the validity and uniqueness of the IP. This is what collaboration does for the big guys.

While the drugs companies have to go through so many safety-oriented tests, it is easy for them to demonstrate the unique nature of their product.

With IT-IP the collaboration model of development also offers another package of value. Take XML Schema. The most effective Schema will be industry-wide, with some companies eventually supporting several Schema in their IT.

To be the most effective, and to generate the best returns for IT companies on the Net's Service Model, there has to be a standard platform that all these schema can use. So the first task (if you're IBM, or HP, or Microsoft, or...) is to cross-licence IP in this open layer. This is not because they want to, eventually, charge for the Net - they know they would never get away with that. Rather, it is to ensure they have control over the next layer - through IP.

Once they have ironed out the standards for the basic infrastructure they can begin to develop and cross-licence at the business-function level. But, they know that to standardise at this level requires:
- The backing of the industry concerned;
- Enough suppliers backing the standard, and supplying solutions to make the market open; and
- Hooks for unique 'value-add' solutions.

To my certain knowledge many of the larger suppliers have been working on (customer-industry) collaboration for Web Services, Schema, etc. for some time.

But, even with all that political hooha going on I do not see a shrinking role for small, innovative, companies. Certainly, there are fewer. However, I would suggest that this has more to do with the very sharp lesson that investors have recently endured.

IP will, without doubt, make it more difficult for smaller companies to enter the business process outsourcing market - which is the long term goal of IBM, Microsoft, Accenture, HP, and many others - and the ultimate destination for the IT industry (unless something comes along to change it). But, and it's a big but, small companies will still catch these Elephants out. They just can't dance.

Posted by: Stephen Wheeler   Posted on: 11/10/04 You are currently: a Guest | Members login | Terms of Use

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