> The flaw in this line of thought is that patents don't limit access to knowledge or technology. Quite the opposite, in fact. What they do limit is commercializing of knowledge or technology without license.
So they don't limit access to knowledge or technology, they just limit commercializing of knowledge or technology. Because technology that can't be commercialized (and therefore obtained or used) is what people want?
If someone has a patent on X then there is no competition for the production of X, so the patentee can charge higher prices, so fewer people will be able to afford X.
If someone has a patent on X then there is a greatly reduced incentive for anyone else to improve X, because the original patentee can prohibit you from selling your improvement unless you give them an arbitrarily large share of your profits.
>So they don't limit access to knowledge or technology, they just limit commercializing of knowledge or technology
"Without license."
> If someone has a patent on X then there is no competition for the production of X, so the patentee can charge higher prices, so fewer people will be able to afford X.
Right, because the hundreds of thousands of patents on various aspects of smartphones are consistently making them more and more expensive as time goes on.
> If someone has a patent on X then there is a greatly reduced incentive for anyone else to improve X, because the original patentee can prohibit you from selling your improvement unless you give them an arbitrarily large share of your profits.
Sure, they can ask for arbitrarily large shares of profits, but that's when you move to a lawsuit, where there are more concrete limits on what can be demanded as royalties. However, lawsuits are highly expensive and risky to both parties (even patent trolls risk having their patents invalidated), so there is a strong incentive to find a middle ground.
"Without license" is implied by "limit" -- that's the limitation.
> Right, because the hundreds of thousands of patents on various aspects of smartphones are consistently making them more and more expensive as time goes on.
Nobody said anything about "more and more expensive as time goes on." As soon as there is one necessary patent the seller can charge the monopoly price. Adding more patents doesn't change the monopoly price (though it does add transaction overhead that comes out of everyone's margins).
You can't claim that the monopoly price is not higher than the competitive price would be in the absence of patents.
> Sure, they can ask for arbitrarily large shares of profits, but that's when you move to a lawsuit, where there are more concrete limits on what can be demanded as royalties. However, lawsuits are highly expensive and risky to both parties (even patent trolls risk having their patents invalidated), so there is a strong incentive to find a middle ground.
The damages a court would award isn't a lower bound because the patentee can request an injunction that prevents you from selling the product until you pay them whatever they demand.
What are you even trying to argue anyway? That lawsuits and license fees don't cost money? That having to pay money isn't a disincentive to do something? That limiting competition doesn't increase prices?
> "Without license" is implied by "limit" -- that's the limitation.
Again, what is limited by the license is the commercialization, not access to the knowledge or the technology. These are completely different things. You can find out all about a patented technology, and even implement it for non-commercial (e.g. research) purposes. You simply can't attempt to make money off it without a license.
> As soon as there is one necessary patent the seller can charge the monopoly price. Adding more patents doesn't change the monopoly price (though it does add transaction overhead that comes out of everyone's margins).
The major flaw in this argument is that these thousands of patents are owned by many hundreds of entities. There is no monopoly". As a counter-point, all you need to look at is the sub-$50, contract-free smartphones available in the US.
> The damages a court would award isn't a lower bound because the patentee can request an injunction that prevents you from selling the product until you pay them whatever they demand.
1. Injunctions are not always available, are not automatic and you have to convince the ITC, a separate court, to give you one.
2. Injunctions have been very hard to get in the US since the eBay decision.
> What are you even trying to argue anyway? That lawsuits and license fees don't cost money? That having to pay money isn't a disincentive to do something? That limiting competition doesn't increase prices?
I'm arguing that all those concerns, while making sense in theory, are not necessarily supported by empirical evidence, especially given the vibrant smartphone industry despite being rife with patents and lawsuits. As such it is not clear if those are greater or less than the benefits provided by patents.
So they don't limit access to knowledge or technology, they just limit commercializing of knowledge or technology. Because technology that can't be commercialized (and therefore obtained or used) is what people want?
If someone has a patent on X then there is no competition for the production of X, so the patentee can charge higher prices, so fewer people will be able to afford X.
If someone has a patent on X then there is a greatly reduced incentive for anyone else to improve X, because the original patentee can prohibit you from selling your improvement unless you give them an arbitrarily large share of your profits.