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Why Patents and Copyright Protections Are More Important Than Ever

Don’t listen to pundits who say the intellectual property system has outlived its usefulness. It needs to be updated, not abolished


SA Forum is an invited essay from experts on topical issues in science and technology.

A few months ago a venture capital company I consult for asked me to visit the offices of Baker–Calling, a Santa Monica–based start-up trying to build a better microphone for use in smartphones and tablets. Baker–Calling’s founder, Robert Littrell, has been working on this problem for eight years—first while earning an engineering PhD at the University of Michigan, and now as the CEO of his five-person company. He believes that his microphones, which detect sound using piezoelectric sensing, can offer both better quality and lower cost than traditional microphones that contain a vibrating diaphragm. In September he was issued a U.S. patent for his invention.

It’s too early to know whether Baker–Calling will succeed. But it’s clear that a tiny start-up like that wouldn’t stand a chance without some way of protecting what’s taken years of hard work and millions of dollars to develop.

Most people agree that  inventions like new microphones should be patentable. But today many academics, venture capitalists, policy analysts and others are questioning the value of patent protection for other sorts of inventions, such as software, which are created in industries where product cycles are short, up-front investments are lower and time to market plays a central role in market success.

Last year, Judge Richard Posner of the U.S. Court of Appeals for the Seventh Circuit told Reuters, “It’s not clear that we really need patents in most industries.” Two economists at Washington University in Saint Louis went further, arguing that the entire patent system mainly encourages “large but stagnant incumbent firms to block innovation and inhibit competition.” Their recommendation: abolish it altogether.

The value of copyright has come under attack as well. In September researchers at the London School of Economics and Political Science released a report [PDF] making the dubious assertion that music piracy is actually good for the music industry. Euphemistically referring to downloading pirated music as “content sampling,” the authors cited a study purportedly showing that “file sharers in the U.K. were found to spend more on content than those who only consumed legal content.”

Someone who takes content without paying might consider it “sampling,” but the musician from whom it was taken could be forgiven for calling it “theft.” (Music industry expert Mark Mulligan has noted the irony of academics who accept salaries for writing papers that question the right of musicians and recording artists to expect compensation for their creative output.) In any case, the argument that piracy should be permitted because it can help drive sales is fundamentally flawed. After all, we wouldn’t countenance shoplifting by suggesting that it might spur some shoplifters to return at a later date and make legitimate merchandise purchases. Musicians can certainly choose to provide some free content to potential buyers. But they shouldn’t be forced to adopt a business model that uses piracy as a loss leader to drive sales.

Just because today’s technologies can sometimes make it easier to invent more quickly and at less cost doesn’t mean the resulting inventions are less valuable to society or less worthy of protection. And just because content can be easily distributed using the Internet doesn’t make the contributions of those who create it less valuable. Without the protection of the patent system many entrepreneurs—including software entrepreneurs—would risk having their innovations simply stolen by larger, deeper-pocketed competitors. Faced with that prospect, they are far less likely to launch their new companies, leaving us all without the benefit of their innovations.

Abolishing the patent system or legitimizing music and movie piracy would be, to put it mildly, a disaster. Doing so would strip away much of the incentive to create, impeding investment in new technologies, slowing the production of new creative content and harming economic growth.

This is not to say that the intellectual property system is perfect. Patent offices around the world should tighten standards to ensure that only inventions truly worthy of protection receive it, thereby reducing the amount of litigation involving flawed patents. Copyright laws and licensing approaches should be updated to better reflect the modern creative content ecosystem. Traditional copyright frameworks designed for physical (as opposed to electronic) content distribution, often within a single country, can be out of step with today’s global digital marketplace.

The fast pace of innovation and the increasingly international flow of goods and content can create challenges for traditional patent and copyright systems. But those systems, despite their flaws, remain vital to economic prosperity. The correct approach is to update them, not dismantle them.

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