At a seminar organised by the South Centre in Geneva on June 30, UNU-MERIT researcher Rishab Ghosh participated in an expert panel on intellectual monopoly powers and standards.

IP-Watch reports:

Standards can be of two kinds: de facto standards created by market forces, and de jure standards created by standards-setting organisations. In both cases, the standards can include intellectual property rights.

In the de facto scenario, “the value is in the standard, not in the technology itself,” said Rishab Aiyer Ghosh, senior researcher at the United Nations University (UNU-Merit) in the Netherlands. The value comes from the fact that everybody is going to use the same technology, he said.

After Stiglitz and Sulston last week, now the Wall Street Journal has an article about the problem that the patent system has become. It’s US-focused, but it pretty neatly outlines how the debate on a mild patent reform there sets the pharmaceutical industry against technology companies:

Yet the fault line over patent reform signals the deeper problems. Many pharmaceutical companies lobbied against the proposals, fearful of reduced value in their key intellectual property. In contrast, most technology firms supported the reforms, worried more about uncertainty in the law than about the value of their patents.

Both sides may be right. New empirical research by Boston University law professors James Bessen and Michael Meurer, reported in their book, “Patent Failure,” found that the value of pharmaceutical patents outweighed the costs of pharmaceutical-patent litigation. But for all other industries combined, they estimate that since the mid-1990s, the cost of U.S. patent litigation to alleged infringers ($12 billion in legal and business costs in 1999) is greater than the global profits that companies earn from patents (less than $4 billion in 1999). Since the 1980s, patent litigation has tripled and the probability that a particular patent is litigated within four years has more than doubled. Small inventors feel the brunt of the uncertainty costs, since bigger companies only pay for rights they think the system will protect.

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Nobel laureates Joseph Stiglitz (Economics, 2001) and John Sulston (Physiology/Medicine, 2002) argue that the patent regime, along with other forms of intellectual monopoly powers, locks down access to knowledge rather than allowing its dissemination.

Both were speaking at the launch of Manchester University’s new Institute for Science, Ethics and Innovation:

Patent monopolies are believed to drive innovation but they actually impede the pace of science and innovation, Stiglitz said. The current “patent thicket,” in which anyone who writes a successful software programme is sued for alleged patent infringement, highlights the current IP system’s failure to encourage innovation, he said.

Sulston made the privatisation of science his topic:

Reversing the trend toward privatisation of science is critical, Sulston said. The world should concentrate on the survival and thriving of humanity, and exploration of the universe, he said. The outcome, he added, depends to a great extent on “who owns science.”

via IP-Watch