Comment Re:Devil's Advocate (Score 2, Insightful) 309
If the above happens, no one will want to invest in research, because they'd lose money, even if they "invented" the next IPod.
But Apple didn't invent the portable MP3 player. "Research, invent, commoditise, sell" is a plausible-sounding business plan, and I'm sure it sometimes works out that way, but much more commonly, companies learn from each other's mistakes and release competing products with small improvements. Apple realised people wanted an MP3 player that was slick rather than geeky-looking, so they repackaged it. That was their innovation. And it's a good thing - I'm not knocking that kind of incremental innovation. Patents harm that way of innovating, though, because the only companies that can play the game are those with big enough patent portfolios to deter their competitors from suing.
The portfolio problem applies to blue-sky innovation too. Imagine you invented the portable MP3 player from scratch in your garage and patented it. A year later, Apple releases the iPod. What are you going to do? If you sue, they can just pull some ridiculously broad patent out of their portfolio and counter-sue until you lose everything. The best you can do is to sell your patent to one of their competitors for use in their portfolio, and good luck getting a decent price when the buyer has all the lawyers.
There is one area where patents work more or less as expected, though, and that's drug development. Drug companies have a pretty good track record of throwing money at a problem until they get a usable drug (often usable for a different problem, admittedly), patenting the drug, and recouping their investment within the lifetime of the patent. Everything would be wonderful except for two catches: the money available to pay for a drug doesn't always match its social importance (the malaria problem), and the price of the drug while it's under patent may be too high for many of the people who need it (the HIV problem).
We've tried to patch the malaria problem through charitable funding of drug development, and the HIV problem through charitable subsidisation of drug prices, but both patches exacerbate the underlying problem by putting yet more patents and yet more money into the hands of the incumbent drug developers, meaning that next time we run into similar problems they'll be even more expensive to solve. The only solution I can think of is to create a public interest exception for patent licenses, coupled with public funding of socially important research, because the private money will move to areas that aren't covered by the public interest exception. But that sounds too much like dirty commie talk for a lot of people's liking.