Tuesday, May 02, 2006

The Price of Innovation

There is great danger in being an innovator. Just ask the fathers of television, John Logie Baird and Philo Farnsworth. Both died lonely and dejected after having their ideas ripped off by big business (by Marconi and RCA respectively).

This thought comes after Tivo's recent court win over EchoStar over the working of the DVR (digital video recorder). Tivo has been a great innovator and was instrumental in changing the way television is used by millions. However, their idea was quickly copied by others, who often made a better job of it. With satellite operators giving the boxes away, Tivo were forced into a licensing deal with DirecTV (although in the UK DirecTV's sister organization, Sky has its own superior 'proprietary' technology).

Tivo has lost the best part of half a billion dollars since being founded and is competing with companies with very deep pockets and expensive lawyers.

The flip side of this situation are the frivolous law suites launched by Acacia against anyone and everyone streaming media online. This speculative bunch of bandwagon jumping lawyers represent all that is rotten with the American patent system. The term used for these parasites is 'patent trolls'. You might recall a similar patent suite saw Blackberry manufacturers, RIM handing over $612m to NTP (without knowing the facts I can't possible comment on what a ridiculous decision this was...).

Innovating is easy, protecting your innovation against lawyers and deep pocketed competitors is very difficult. As Farnsworth and Logie Baird found out to their cost..

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