With popularity and success in the emerging technology market, where new ideas and inventions drive high profits for new products, not far behind are the fortune seekers wishing to piggy-back on the success of others. Sometimes these can add value to the experience (for example, Apple developers succeed because of Apples new iOS platform being successful itself) and other times they simply wish to bleed the success of others into their own pockets.
The favoured method of choice is the patent - or rather the breach of a patent relating to the new fantastic product that is making money hand over fist. The latest to get popularity in the press is none other than Lodsys. They claim that a patent that they obtained indirectly (i.e. someone else filed it and they bought it) US Patent # 7,222,078 has been used by Apple iOS developers that use In-App Purchasing without paying Lodsys 0.575% of the developers US Revenue.
Whoever believed that ideas and concepts should be patentable without evidence of their existence should be, quite frankly, shot. When filing a patent no evidence needs to be submitted that the ideas conveyed are possible with current technology or would ever work in reality (call them “stab in the dark” patents if you like). Hence it is possible to file patents for whatever you like and in the future, should someone have the same or remotely similar idea and that idea makes money, you can sue or threaten to sue them. The people that made it work lose. The people that filed it without ever making it work or intending to make it work, get money for nothing.
Whether this is a fair situation isn’t relevant - the fact is that the patent system is broken in this way. It may well function in some other ways for legitimate claims, however the broadness and vagueness of most patents renders it difficult to tell the difference between a valid patent and a stab in the dark patent.
In an attempt to justify their position Lodsys released an FAQ and I particularly like the first part and I quote:
“As a comparative example, it is the owner of the hotel who is responsible for the overall service (value proposition) that guests pay for, not the owner of the land that the hotel may be leasing, not the travel agent that sold the reservation, not the manufacturer of tools such as hammers, nor the provider of materials such as nails or steel beams, which may be used in building the hotel; nor is it the outsourced linen washing service or the architect of the building who is responsible. Lodsys’ patent portfolio is being used as a part of an overall solution and we are seeking to be paid for the use of patent rights by the accountable party.”
Alas the inventor of the idea (or the first person to patent the idea of a hotel) isn’t getting a cent from the Hotel owner or its guests either directly or indirectly. (Not wanting to give Lodsys more ideas for patents but maybe patenting the concept of a Hotel could pan out for them…) To continue the Lodsys analogy: Apple (the Hotel owner) invited their developers (the hotel guests) to use In-App Purchasing as a service (the in-room telephones). The patent holder for the telephone as “an overall solution” for talking to someone far away, can not extort the guests for additional costs for using the in-room phone as those costs are borne by the hotel owner, not the guests. The Hotel owner chose the phones, set the rates (if any) and maintained the service for those guests.
That said, a patent holder may try scaring the guests and shaking them for chump change and might stand a change of getting some money for nothing, whereas a big lawsuit with the hotel owner just might cost them money in the long run. On ‘ya Lodsys.
Epilogue: My app does not use In-App purchasing