Patents ARE monopolies. Monopolies are anticompetitive. End of story.

This includes distinguishing them from business method patents. In any event the first of those which reached the High Court was invalidated on the bsis it was not an invention as defined under today’s equivalent of the Bill’s clause 13. And clause 13 has been drafted to ensure the applicability of decisions of the courts under the existing Patents Act, such as excluding claimed processes which are in reality no more than what the law calls “mere schemes”.

It’s certainly not true that “as any electrical engineer knows” software may be replaced by hardware. It’s fanciful to consider building a hardware machine to replace something as complex as, say, Linux or Windows with no software components. The machine would be huge, and desperately uneconomic. The word “impractical” doesn’t begin to describe this notion.

Using arguments like this should get someone laughed out of court.

Colin

The Myth that Patents are a Monopoly

A patent gives the holder the right to exclude others from making, using or selling their invention. 35 USC 154. It does not give the holder the right to make, use or sell their invention. A monopoly is an exclusive right to a market, such as an electric utility company. An electric utility company has the exclusive right to sell electricity in a certain territory. Since a patent does not even given the holder the right to sell their invention, let alone an exclusive right to a market, it is clearly not a monopoly.

When a person describes a patent as a monopoly to be consistent they should also state that they have a monopoly over their car or over their house. In fact, they have more rights in their car and house than a patent gives the inventor over their invention, since you have a right to use and sell your car or house. A patent does not give these rights to an inventor over his invention. All invention are built upon existing elements (conservation of matter) and if the elements that the invention uses are patented, then the inventor will not have the right to sell their invention without a license.

Some economists argue that a patent is designed to give the holder monopoly power. Those economists who are consistent also state that all property rights give some monopoly power. The property rights are monopolies thesis shows how confused economic thought is on this subject. The only logically consistent definition of a monopoly is an exclusive right to a market.

People who suggest a patent is a monopoly are not being intellectually honest and perpetuating a myth to advance a political agenda.

For more information on patents and innovation see http://www.hallingblog.com.

There is no point in New Zealand doing things differently becasue we have not taken IP seriously enough in the past and even in the present

There are also economic studies showing that patents as a whole have questionable effectiveness in “encouraging” invention. But that can be a war of words for another time. :)