Patents Revisited, Innovation Encouraged

To a lot of IT companies, patents translate to respectability. Take IBM. For about 15 years running, Big Blue has received more U.S. patents than any other company in the world, totaling 33,000 since 1995. Now that's impressive.

But in reality, the impact of patents goes well beyond bragging rights. And that impact isn't always positive. Claim rights over a technology or development process and stand the chance of potentially stifling innovation. Now, at least, it seems the government is finally doing something about it.

Early this month, the Supreme Court threw out a decision made by an appeals court that upheld a patent, stating that the decision did not properly apply the rule that "an invention must be new, useful and not obvious." The latter point is what the high court keyed into, saying many factors could lead to the conclusion that an invention is obvious--market demand for a particular combination of technologies, for example, or the common practice in a given industry to look for such combinations.

The fact that the decision involved a patent for adjustable gas pedals doesn't change the fact that the Supreme Court's decision essentially pointed to what the channel does by definition--combine pre-existing products into a new solution--and deemed it not worthy of patents. It sounds harsh on one hand, but dig a little deeper. The decision might be the best thing for solution providers.

Consider the patent awarded to NeoMedia Technologies, which is currently being challenged by the Electronic Frontier Foundation (EFF). NeoMedia claims to own rights to all systems that provide information over computer networks using database-like lookup procedures that rely on scanned inputs, such as bar codes. That stands to have a huge impact on development in supply-chain management and mobile computing, where lawsuits have already been brewing, as well as work being done in the research community, health care and think tanks. The patent has the potential to stop many programs in their tracks.

Another example is the patent awarded to IBM only a few months ago for a secure smart-card production method. Vague in specifics, the patent forwards the company's efforts to leverage public key infrastructure (PKI), biometry, workflow and smart-chip technology for a method of identity verification that can be used in both the public and private sectors.

No formal objections have been filed yet, but smart-card technologies are obviously huge in government right now--particularly with the Homeland Security Presidential Directive 12, or HSPD-12, and Real ID legislation in full swing. Ownership by any one company of a related process or solution could potentially affect other channel efforts to meet demand. Time will tell if that turns out to be the case.

This is not to say that NeoMedia Technologies and IBM don't deserve credit for thinking outside of the box when it comes to their development processes--or that they don't deserve to hold patents, for that matter. IBM actually came out in support of the Supreme Court's decision, saying that its own concepts for new products have been blocked at times from patent infringement claims.

Nor does it mean that the growing number of integrators offering their own packaged, branded solutions to meet the demands of government customers shouldn't maintain some degree of ownership over their creations. Complete solutions are, after all, what agencies are using to drive the market forward. Why shouldn't the channel be recognized for taking technologies to new levels?

Rather, this landmark decision serves as a reminder to solution providers and manufacturers alike not to be so consumed with the bragging rights attached to patents that they forget why they're in the business of technology in the first place. In most cases, the question comes down to this: Does the patent really matter? A company is only as good as its last big breakthrough; those that focus on customer requirements to decide what's next in the pipeline are far more likely to win opportunities in the public sector and elsewhere.

The truth is, innovation is difficult to define, but to mimic the words of another well-known court decision, "You know it when you see it."