Open Source India
Tuesday, May 05, 2009
Andy Grove: Patents Are Like Mortgage Backed Securities
In one of my previous posts, I had talked about how patents (particularly software patents) are another bubble ready to burst. I also talked about how global patent trolls are now coming to India. Now, Techdirt has an article that quotes Andy Grove, former chairman of Intel and author of the book, Only the paranoid survive, comparing how patents have become like the mortgage-backed securities that caused the current financial meltdown.
When Andy Grove becomes paranoid about something, you and I better watch out!
The true value of an invention is its usefulness to the public. Patents themselves have become products. They're instruments of investment traded on a separate market, often by speculators motivated by the highest financial return on their investment....
The patent product brings financial derivatives to mind. Derivatives have a complex relationship with an underlying asset. While there's nothing wrong with them in principle, their unfettered use has damaged the financial services industry and possibly the entire economy.
Do these patent instruments put us on a similar road? I fear our patent system increasingly serves those who invest in the patent products... It may be time to use Jefferson's principle as a test and ask if we meet it.
When Andy Grove becomes paranoid about something, you and I better watch out!
Labels: Andy Grove, derivatives, Only the paranoid survive, patent troll, Patents
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