The other day I talked about Insurgents vs Incumbents. This is the framework we use at [Union Square Ventures] to think about a lot of things. And in the world of patents, the advantage goes to the Incumbents who can hoard patents and use them to their advantage. The insurgent, three engineers in a walk up in Bushwick, can’t even afford the lawyer or the time to file a patent. So it is very encouraging to see an emerging incumbent, Twitter, do something like this. They are saying to the world that they do not intend to compete on the basis of patents and instead they will compete on the basis of product, feature set, user experience, etc, etc.
USV is committed to support this initiative. We are instructing the startup lawyers we work with to insert the patent hack language in our standard forms. We are reaching out to our friends in the startup world including other VCs, accelerator programs, and the startup lawyer universe to suggest that they to insert the patent hack into their standard forms. And we will recommend to our existing portfolio companies that they adopt it as well. Of course, entrepreneurs and their companies will have to be the ultimate determinator of whether they want this provision in their inventions assignments agreement. If an entrepreneur we invest in does not want this provision, we will certainly support that decision. But we will want to have a conversation about why they would want to do that.
Fred Wilson, Principal, Union Square Ventures. The Twitter “Patent Hack”.
Background: Yesterday Twitter announced its Innovator’s Patent Agreement whereby it will put patents in control of its designers and engineers. The goal is make sure that patents are only used defensively against potential lawsuits. As Adam Messinger, Twitter’s vice-president of engineering writes:
Typically, engineers and designers sign an agreement with their company that irrevocably gives that company any patents filed related to the employee’s work. The company then has control over the patents and can use them however they want, which may include selling them to others who can also use them however they want. With the IPA, employees can be assured that their patents will be used only as a shield rather than as a weapon.
An important move, to be sure. M-CAM, a global asset management firm, reports that there are “over 30,000 patents that describe key aspects of social networking, ecommerce, and data management” with companies spending $83 billion each year defending themselves against them.
Twitter’s IPA move is the company’s attempt to reinvent how patents are used (for defense only) and we hope others are inspired to do the same. It’s great to see major tech players like Union Square Ventures looking to bake the concept into all the startups it works with — Michael
I don’t understand why anyone would ever think that adding a presentation layer on top of web based content would make it something people would want to purchase when they are not willing to purchase the same content directly on the web.
A central issue with the Internet, no matter what device and presentation layer you use to access it, is that there is an unlimited amount of content available. Evan Williams calls it “a web of infinite information” in this chat with Om Malik. What is valuable is filtering and curation. Restricting access to content doesn’t work. Someone else’s content will get filtered and curated instead of yours. Scarcity is not a viable business model on the Internet.