Much has been made of Lodsys, and we have heaped scorn upon them. But Lodsys is nothing but a container for scorn, a shield in East Texas, one shell in a game of shells designed to distract us from the real villain—Silicon Valley itself.
At the core of a network of thousands of patent trolls lies the biggest troll of all, a protection racket called Intellectual Ventures. If you’d like to know more about Intellectual Ventures and their relationship with Lodsys and other trolls, I recommend the latest edition of This American Life, who did a story on the subject.
The story was familiar, but the conclusion was novel—Intellectual Ventures is a Silicon Valley startup, funded by venture capitalists who are expecting massive returns, which are only possible by squeezing as many revenue streams as possible.
One thing you have to know about the Valley is that, underneath its non-disclosure and non-disparagement agreements, it is completely incestuous. The same investors, the same funds, the same companies come up with their finger in the same pies again and again and again.
That means that when IV and their horde of hypodermic parasites land on other Valley companies, the licensing fees are just moving money around between the same people. The only real revenue is from Valley outsiders—indies and foreigners. You know, the ones they laugh at.
When you follow the money all the way through the complex tunnels of financial and legal confusion, you end up at the Valley itself. This whole patent war is really just a huge anti-competitive play that the Valley has made, intentionally or not, to screw the rest of the technology world.
A Silicon Valley refugee such as myself, who has fled to a jurisdiction with a saner patent system, finds himself stuck, because all the serious platforms are based in or around the Valley.
Even if a European company makes apps to sell in Europe, they still have to go through a Valley company, making them potential victims of this whole scam. The EU is going to need to step in to protect its technologists from this American madness.
There is also an opportunity here. I’ve said before that this nonsense is going to leave the US a third-world pariah in technology. Right now the calculus must be that even if they lose the App Makers to broken healthcare and immigration systems, they still control the platforms.
But for how long? Because right now the US patent system is every app platform’s major weakness. If someone were to exploit that by making a decent platform out of reach of American attorneys, I and most other developers would flock there.
Indeed, we might have no other choice.