Does Paul Allen Suing The Entire Internet Prove Our Patent System's Broken?

Microsoft co-founder Paul Allen has launched a salvo of litigation over disputed patents, targeting Apple, Google, AOL, and Netflix, among others. None of the patents involve technology Allen was responsible for creating, but were licensed through his Silicon Valley incubator.

The high profile legal assault is based on some vague ideas you might be surprised are patented in the first place, such as having items suggested to you based on what you're currently viewing, viewing related news stories, and the placement of online advertisements in your peripheral vision. In other words, things that are pretty much all over the entire internet. One of the patents in question is, we kid you not, for "Alerting Users to Items of Current Interest." Archimedes is rolling in his Hellenic urn.

A spokesman for Allen says "Paul thinks this is important, not just to him but to the researchers at Interval who created this technology...We recognize that innovation has a value, and patents are the way to protect that." But the question of what should be deemed an "innovation" remains an open, hotly-contested one. Google and Facebook have already sworn to fight the suit.

In a NY Times op-ed last year, executive and Harvard Business School lecturer Robert Pozen argued for a serious (and urgently needed) overhaul of the US patent system. "The quality of American patents has been deteriorating for years," Pozen laments, claiming "they are increasingly issued for products and processes that are not truly innovative." In the patent system, innovation is key. The criteria for a patent are that a new technology must be non-obvious to someone trained in that field, useful, and new.

The decision of which patents have those properties and which don't is up to the varying phalanxes of examiners, litigators, and judges, but an increasingly vocal faction thinks the entire system is broken. Patents—monopolies on ideas—aren't being dished out deservedly, they say. Pozen thinks crucial reforms are needed to increase the level of expertise involved in the application process, boost transparency, and cut down on needless lawsuits. Patent law requires a staggering level of technical knowledge and shrewd analysis, but it seems that when ownership of ideas and not good ideas themselves are making people money, something has gone wrong. [WSJ]