P2Pnet has a nice story about the "We're not gonna take it anymore" club of parents fed up with being targeted because of Cartel greed. Candy Chan, James and Angela Nelson and John Harless have joined acclaimed mom Patricia Santangelo in standing up to the jihad against customers. All three are making the case that they are being wrongfully targeted and are resisting Cartel threats to sue their children if they don't pay up.

Earlier this week the Cartel backed down in Chan's case, with the judge denying their motion to sue her 13-year-old daughter instead.

(Just in case you'd forgotten, "Sue All the World" began with Camp Chaos.)

Cory picked up on PVRblog's coverage of what was eventually determined to be a bug: Users found their TiVos unexpectedly expiring recorded shows.

It might well have been a bug in this instance, but bugs like that don't just come from nowhere, with fully formed error messages alerting viewers that "Due to policy set by the copyright holder, 'Keep until I delete' is not permitted." Maybe it wasn't meant to show up here and now, on broadcast TV, but someplace in TiVo's corporate innards, someone decided that unrequested expiration was a feature.

Nothing in copyright law mandates this "feature." To the contrary, once you have a lawful copy of a copyrighted work, the first sale doctrine says you have the choice whether to save, lend, or discard it, while Betamax says timeshifting creates a lawful copy. If not copyright law, then copyright-holder muscle probably sits behind TiVo's design. Copyright holders work with Macrovision to implement extra-copyright controls, then jointly lean on TiVo to respond to them. Together, they restrict user rights beyond copyright.

The bug also illustrates the fallibility of proprietary technologies (particularly those with automatic update). "Update" doesn't always mean "improve" -- an update can take away functions you've come to enjoy, just because someone else objects. This misfeature of any DRM that implements "revocability" gives "planned obsolescence" a whole new meaning.

Like Cory, I've gone the MythTV route instead. With hundreds of people hacking on its open-source code, MythTV updates really are improvements. Its features are truly features, like commercial skip, time-stretch, transcoding and transfer to other media, plus an open-format music server on the side, giving full access to all the rights copyright reserves to the public. Sorry TiVo, you've been out-evolved.

That's the question David Pogue asks in today's NYT column, because what you can do doesn't include many of the things a customer would most want. Add Apple/Cingular/Motorola's new Rokr to the list of technologies Derek recently reviewed in the new guide, The Customer Is Always Wrong -- deliberately crippled to protect outdated business plans.

...Will the phone have a hard drive that can hold thousands of songs? Will you be able to download songs straight from the Internet? Will it have a FireWire or U.S.B. 2.0 connector for superfast music transfer? Will you be able to use your songs as ring tones, so that the phone bursts out in "You Make Me Feel Like a Natural Woman" when your husband calls? ...the answer to all of [those questions] is no.

No, the phone doesn't contain a hard drive. It comes with a tiny, 512-megabyte TransFlash memory card. Incredibly, though, you can only store 100 songs on the phone, tops, no matter how much room is left on the card.

... No, you can't use songs as ring tones, at least not the songs you've bought from Apple's music store. (You can use ordinary MP3 files as ring tones, but loading them onto the phone isn't trivial.) This, too, is almost certainly a limitation driven by corporate interests. Cellphone carriers charge $1.50 to $3 apiece for ring tones; Cingular certainly wouldn't want to hand that lucrative business over to Apple's music store.

If you'd rather listen to music on your phone than grouse about these engineered limitations, there's always the open-source TCPMP for Treo or WinCE, which not only plays MP3 and OGG files, but videos too.

Marty Schwimmer @ Between Lawyers, in a post categorized under "Anger":

I loved iTunes and I thought iTunes loved me.

But then I wanted to buy the song BREATHE ME (the song from the death montage from Six Feet Under), and iTunes told me that I couldn't unless I bought twelve other songs I didn't want.

Darling, our first fight.

Maximizing every short-term advantage may not be the best long-term strategy. [emphasis added]

For more on that last point, check out SharkJumping's Music Label Unhappiness with ITunes - a Price Elasticity Debate, a post responding to the fracas between Apple and the record labels over raising prices in the infant market for online music:

The core disagreement is that labels feel that flat rate pricing doesn't capture enough margin for those hot tracks where users would pay more. Numerous studies will be trotted out, showing that consumers will pay up to $2-3 for hot singles, so the labels are giving up substantial margin by wholesaling all tracks at $.70-75...I have no doubt that if you picked one hot track, and polled users in isolation to ask them if they would pay more than $.99 for that track, many would tell you yes. But the studies show that when you measure behavior across a longer period of time, everyone is better off with lower prices for music downloads, with $.50 being actually the magic number, especially for a business which has NO hard cost of goods outside of artist royalties, which are almost never on a fixed basis so they will decrease with the price.

Back in June, NPD Group raised some eyebrows (including in this blog) with a claim that iTunes was the second-most popular music download site, surpassing many free P2P sites. Derek Slater commented that the NPD study was "worthless."

Well, NPD are back again, and their latest message is resonating with the RIAA. According to an AP story (here on SiliconValley.com) NPD are claiming that burned CDs accounted for a larger percentage of music obtained by fans than downloads did. The RIAA are, of course, pointing to this as a justification for more copy-prevention.

A very telling quote appears at the end of the AP story, where Virgin Entertainment Group International's CEO Simon Wright is quoted as saying:

If, particularly, the technology allows two-to-three burns, that's well within acceptable limits and I don't think why consumers should have any complaints.

And that, boys and girls, is the nub of the problem. The Cartel believes it should be able to extend its control past the sale of the product, past what the law might say, and into your and my houses and cars. Let's take a real-world example: my neighbors have two adult children that live with them. So that's four cars, and at least three CD systems in one household. How many copies of a given CD purchase should that family be allowed to make? None? One? Seven? And why does Wright think that my neighbors shouldn't complain if he makes it impossible for them all to enjoy their purchases?

By coincidence over on Reuters (story copy here on silicon.com) we read that "Legal music downloads [are being] held back by DRM." The gist of the story is that incompatible DRM systems (fingers pointing primarily at Apple and Microsoft) are somehow preventing consumers from downloading more music.

My first response is that this is a crock. I don't think DRM issues enter into anyone's minds when going to download music. ITunes is enjoying phenomenal success (what business wouldn't mind doubling its size year over year?) and Napster et al are sour-grapesing because their systems (which use the MSFT-promoted DRM systems) are lagging. Blaming it on the DRM is a smokescreen for having to admit "My customer experience sucks, the subscription model isn't working, and Apple are kicking my ass."

...even if their record company tells them not to.

Downloadable music wasn't much in Japan, until about a week ago. Then iTunes hit the Japanese market and four days later a million new downloads had been racked up. The company's local catalog boasts about a million song titles from fifteen of Japan's record labels.

However, some of those left out want in, even if their nominal record label (*coughSonycough*) would rather they sat home. According to an AP wire story (here on SiliconValley.com) at least one individual artist and a major management agency are seeking to do deals directly with Apple.

The snark factor here is incredibly high. Not only does music want to be free, so do musicians. That's "free" as in "free to pursue new and potentially profitable ways to connect to fans." Once again the Cartel puts control over all else - Sony wants to control the download of music from production through distribution, through the service you use and all the way to the devices you're allowed to use to listen to it. This control serves only the corporate interests, despite their attempts to dress it up as being in the artists' interests. Given even the slightest crack of light the artists will promptly bolt for the door.

Run Sano-san, run!

I've been trying to avoid writing about the ongoging feud in next-generation DVD technology, mostly because I consider it stupid. The competition serves no one, and most certainly is a detriment to consumers, who would be best served by a broad market of compatible devices all working to a unified public, open standard.

In this case, the flap is over the fact that Blu-Ray have added DRM features that both mirror and extend the controls that competitor HD-DVD wants to offer. Both systems use the Advanced Access Content System (ACCS), but Blu-ray want to add something to ACCS that they're calling BD+. Tom's Hardware guide has a detailed explanation of what appear to be Blue-ray's plans: throw the kitchen sink in, too. According to that story, the set of DRM features include "phone home" capabilities, self-destruct, and additional ecryption.

So dumb idea the first - have two competing standards - is compounded by dumb idea the second - believing that technical superiority will determine which standard ultimately succeeds. History shows that either marketing+content will beat superior technology (VHS over Betamax) or rapid industry change will bypass the competing standards altogether (as DVD bypassed numerous competing laser disk formats).

Edward Jay Epstein has a nice piece on Slate (audio broadcast on NPR) explaining some of where Hollywood makes its money. Turns out most of it comes from what Epstein calls the "El Dorado" that is television licensing. Ninety percent of the licensing revenue from TV is profit, versus about 2/3 of revenue as profit from DVD sales. Actual theatrical showings are money losers, as even the vastly increased ticket prices and ads stuffed before showings don't cover the studios' publicity and marketing budgets for major films. It costs studios about USD 1.4 for each $1 in ticket revenue generated.

The article also includes other financial tidbits, such as the assertion that the wholesale price of a DVD is around $5, meaning that retail mark-up is 100-400%. Finally, Epstein delves into the way that this revenue arrangement has led television to drive the studios and how that hurts independent movie producers, who don't have the huge television revenue stream on which to rely.

...than simple cause-and-effect would lead you to think. Yesterday I noted that there seems to be evidence that music-sharers are also heavy music buyers, contrary to what the RIAA/BPI would have us believe. Today, the NYTimes carries a piece by UC Berkeley's Hal Varian discussing a study of used-book sales' effects on new book sales.

The study, by Anindya Ghose of NYU and Michael D. Smith & Rahul Telang of CMU, looks at the impact of the used-book market on the new-book market, particularly online. This subject has been of concern to organizations such as the Authors Guild and the Association of American Publishers, which sent a letter to Amazon a couple years back bemoaning its promotion of used options along with new sales.

In their study (online text available from ssrn.com), Ghose et al conclude that the secondary market actually drives new sales, in part because it helps buyers be more confident they can dispose of unwanted books they bought new. This supports a study by Judith Chevalier of Yale School of Management and Austan Goolsbee of the Chicago Business School. These two looked at college textbooks (which are quite expensive to purchase new, compared to mass-market hardcovers) and found that students were, in effect, paying a price to "rent" a textbook for a semester. Paying full cover price for new was deemed more acceptable on the understanding that a percentage of that price could be gotten back by selling the book back at reduced price to the bookstore or to another person.

The bottom line is that consumers and their behaviors are complex and need to be studied wholistically. Just as a used-book sale doesn't one-for-one take away a new-book sale, we should understand that the availability of free downloadable digital media doesn't take away one-for-one from new purchases (whether it's CD sales, movie ticket, DVD sales, whatever). By coming to a better understanding of consumers' motivations and assumptions we can design business models that are more likely to succeed.

British music research firm The Leading Question has published a study confirming what I and other copyfighters have been saying for years: those who share, care. And they show their caring with their wallets, paying four and a half times as much on digital music as those who do not share music tracks.

These, of course, are the same avid fans that the Cartel are suing as fast as they can. Never one to miss a business opportunity they didn't think up themselves, the RIAA and cohorts such as the BPI have no intention of calling off their jihad.

The BBC reports that Abbott has signed a deal with the Brazilian government for its anti-AIDS drug Kalestra. The deal involves gradual price reductions over six years and access to Kalestra's successor. Brazil projects savings of USD 250 million over that time period and anticipates continuing to offer free anti-retroviral drugs to all needy patients in the country.

As I noted back in June, drug patents push uncomfortably into areas where IP rights may come into conflict with governmental initiatives and even fundamental human rights. Anti-HIV campaigners had argued that Brazil's situation qualified under WTO rules for patent suspension. For now that will remain an academic debate; however, Brazil is far from the only country with a growing AIDS epidemic and other similar situations are likely to arise in the near future.

In the wake of Grokster, NPR's Morning Edition carried a good piece this AM on the ongoing slump in box office sales. Titled "Movie Industry Refocuses Amid Box-Office Slump" the piece examined the current decline in US box office ticket sales.

The current movie year is not being good to Hollywood. Last week was the 18th straight week in which year-over-year ticket sales were down (that is, comparing 2005 to 2004). Since spring and summar are traditional big movie-going times for Americans this is somewhat surprising. What's also surprising was that Kim Masters' story didn't just point the finger at P2P and shout "piracy."

Indeed, there are two fairly direct explanations for the decline in revenue, which amounts to about USD300 million. One is that there are fewer movies coming out. Six fewer than last year. On average, a big Hollywood movie will make $50 million in ticket sales. The math adds up. Two is that last year at this time a big box-office seller was Mel Gibson's The Passion of the Christ. I've seen ticket figures for this movie ranging from $330 million to $390 million. In addition, this movie appealed to an audience that doesn't traditionally go to Hollywood movies. Losing that revenue this year also explains the change.

So, what to do about it? Masters reports on a number of experiments in altering traditional distribution methods, including shorter times to release DVDs (where movies make most of their money), simultaneous release, or even releasing big budget films direct to DVD.

All of these are responding to the changing demographics and finances of the box office business. In particular, a large segment of the audience just don't go out to movies as much because they're older, have kids, and have a harder time getting out. Couple this with the change in financing, where DVD prices are going down (now often below $20 even for first releases) and ticket prices are going up. Two tickets alone are $20; add in costs for babysitting, parking, and snacks and you've created an equation that doesn't favor the box office.

Of course, all of these changes and proposals are causing heartburn for theater owners, who see Hollywood as using the piracy claim as a smokescreen for shifting money away from the box office. The owners want to see more movies, better movies, and better promotion.

Michael Schreiber, head tech over at the United Way of America, has published a scathing editorial about the nasty impact that business method patents could have on the future of non-profit/community service organizations:

Consider what the future looks like for nonprofits operating in a landscape where activities as important and efficient as online fundraising are patented by one company or even a few companies. Nonprofits face a few scenarios, and none of them are good:

• Divert a greater percentage of every dollar raised to cover license fees just to operate — money that previously was earmarked for and still needs to go to programs and services making a positive difference in the lives of constituents.

• Settle for other, less effective and efficient technology solutions to avoid the higher cost of patented solutions as well as the threat of being sued.

This certainly is not how donors envision their contributions being used. Donors do care how their money is leveraged to achieve sustainable societal change.

Nonprofit organizations exist to address complex social, environmental, and educational challenges. The last thing we need is another structural impediment like business method patents that could seriously distract us from the creation of tangible and sustainable change in our communities.

Back at the start of June I noted BMG's announcement that it's going to DRM-cripple more of its music disks. Now EMI has decided to jump on the wagon. (*)

The story by Jon Healey and Charles Duhigg has a smarmy condescending tone but covers the essentials. Notably, this tactic is aimed at the casual copier (read: customer), not the really serious pirates. Note that it's still incompatible with iTunes.

Most importantly, note that if fans sit by silently, the Cartel will take that as an OK to proceed. I suggest you do not sit silently. Make yourself heard by taking your dollars elsewhere, by writing to the companies, by creating public ruckus. Blog this, pass it on. Urge the companies to focus on large profiteering bootleggers and call off their war on their customers. Not that I actually expect anything to change, but as the bumper sticker says: "You have the right NOT to remain silent."

(*) use bugmenot if the registration page annoys you.

I was instinctively skeptical of NPD's claim that iTunes has the #2 spot, and it turns out for good reason:

FWIW: the NPD report is basically worthless. The report ignored BitTorrent and eDonkey, the most popular P2P services. The report also treated all users equally; doesn't matter if you've downloaded one song on iTunes and one thousand on Limewire, you're regarded as a single user for each. Saying that iTunes is as popular as Limewire on that basis seems just a bit foolish.

The report is nothing more than pre-Grokster decision ramp up.

(See also: Apple vs. P2P: One Glib Study and Follow-Up: Apple vs. P2P)

(Thanks, Derek!)

Copyright Prof William Patry addresses derivative works today on The Patry Copyright Blog. He gets to the thorny intersection of the Section 115 compulsory license and newer multimedia discs, such as Super Audio and DualDisc, that contain multiple versions of the same recording.

Issues for compulsory licensing are presented because there is more than one layer on a single Super Audio disc. Two principal questions are: (1) whether some of these layers are merely "transfers" that do not represent new authorship, or, whether some, such as remixes for 5.1 channel surround sound, are derivative works for which a separate compulsory license fee is required unless (2) even though there are as many as three layers on a given disc (all perhaps with different derivative versions), the disc is considered to be one "phonorecord" within the meaning of Section 115, and thus one payment only is required notwithstanding that if the layers were separately released they would require three payments.

These aren't just law exam hypotheticals. About the only thing I've heard make record execs steam nearly as much as "peer-to-peer" is the music publishers' claim that they're entitled to double royalties for "copy protected but computer playable" CDs. The music publishers argue that they're entitled to royalties for each copy of the tracks on disc: one set of CD-audio tracks, often poorly hidden from the computer, and one set of WMA or other DRM'd files "meant" for computer playback. It's arguable that end-users have the music publishers, as well as incompatibility problems, to thank for the market failure of copy-protected CDs.

An unbylined story on CNET points to a study by NPD Group indicating that iTunes is now the second-most popular music download site. Most of the popular sites, including #1, remain free P2P sites. But Napster and RealPlayer store also made it onto the list, indicating a growing parity of interest. I'm glad to see this, and sad that it didn't happen five years ago.

Update: The story has hit a bunch of major media outlets that give fuller coverage. For example, Mtv.com gives the list and some background. The award for "Biggest BS with a straight face" has to go to RIAA CEO Mitch Bainwol who is quoted as applauding "A vibrant, competitive marketplace for digital music is a good thing for both fans and investment in new art."

This from an organization that has made its mark stifling digital music marketplaces (see my comment below), engaging in price fixing, and suing fans as fast as possible.

This time it's atoms, not bits, but it's the same story. Reuters reports that Sony is trying to stop distribution in the UK of its PSP (PlayStation Portable). Sony chose to omit European consumers in first shipments due to supply shortages. However, retailers (both online and offline) have responded to consumer demand and established so-called "parallel import sales."

Sony is attempting to use trademark infringement claims to halt the practice. Frankly, it's a crock. This is the same crock as region-encoded DVDs; it's the same crock as nation-limited online archives. The message is "we want to control you." Intellectual property law is just a tool used to exercise that control. I think this is one reason that the fight between the Cartel and its opponents is so nasty. Although it's cloaked by both sides in rhetoric about artistic compensation and business models, it's really a fight about control, and even people who don't openly acknowledge that sense it and get edgy.

A couple of brief pieces (here on geek.com and here on webpronews.com) reporting on Sony's BMG unit continuing to push more widespread use of DRM. After testing in the UK, Sony is now rolling out in the US a technology called XCP2 that is supposed to stop people making further copies of copied disks. The system is designed so that a personal backup copy can be made but the DRM transfers with the copy and blocks further copying. So you can have one copy in your car, but if you own two cars you're SoL?

XCP2 is just one of the copy-control technologies that Sony BMG have deployed and once again the customer is in the dark since the company doesn't label disks it has doctored, nor inform you in advance of purchase. This is what caused me to drop my BMG membership - I want to know. I disagree with PCPro, who call this an "informal deal" with the customer. I didn't have any part of this deal, nor do I have any negotiating power in the exchange, except to pick up my dollars and walk away. I'd hardly call that a "deal."

CNET has a point-counterpoint between Dan Glickman, head of the MPAA, and Jim Burger, media attorney for the law firm of Dow, Lohnes & Albertson on the topic of the broadcast flag.

Of course I'm a completely biased reader, so there's not much point in my commenting on this. In my eyes, Burger does a good job of laying out the realities of why the flag is an absurd overreach of control. Glickman falls back on hyperbole and fear, telling us that without the flag we'll lose broadcast television. Someone send him a link to Pesce's piece, please? Glickman's not as much fun to bash as Valenti - at least not until he reaches equal levels of rhetorical excess - but he doesn't seem capable of conceiving of even the slightest evolution in business models.

If you have a subscription to The Economist, make sure to check out their great critique of the BSA's latest software piracy numbers (BSA or just BS?; Software piracy):

IT SOUNDS too bad to be true; but, then, it might not be true. Up to 35% of all PC software installed in 2004 was pirated, resulting in a staggering $33 billion loss to the industry, according to an annual study released this week by the Business Software Alliance (BSA), a trade association and lobby group.

Such jaw-dropping figures are regularly cited in government documents and used to justify new laws and tough penalties for pirates-this month in Britain, for example, two people convicted of piracy got lengthy prison sentences, even though they had not sought to earn money. The BSA provided its data. The judge chose to describe the effects of piracy as nothing less than "catastrophic".

But while the losses due to software copyright violations are large and serious, the crime is certainly not as costly as the BSA portrays. The association's figures rely on sample data that may not be representative, assumptions about the average amount of software on PCs and, for some countries, guesses rather than hard data. Moreover, the figures are presented in an exaggerated way by the BSA and International Data Corporation (IDC), a research firm that conducts the study. They dubiously presume that each piece of software pirated equals a direct loss of revenue to software firms.

To derive its piracy rate, IDC estimates the average amount of software that is installed on a PC per country, using data from surveys, interviews and other studies. That figure is then reduced by the known quantity of software sold per country-a calculation in which IDC specialises. The result: a (supposed) amount of piracy per country. Multiplying that figure by the revenue from legitimate sales thus yields the retail value of the unpaid-for software. This, IDC and BSA claim, equals the amount of lost revenue.

Cringely's column looks at inflection points, including Microsoft's new game box (which is, predictably, a home digital media center), the Google Accelerator (which is going to push all sorts of buttons around fair use and restricting access - I may try to do a Big Think about that later), and finally he gets back to what he thinks Apple's plans are.

Along the way he lays out his view of the strategy for Yahoo's Music Service, pointing out that their USD7 pricepoint is probably the zero-margin point. This means that the subscription services that are charging more are probably pocketing that extra $7-8/month as profit. Not bad on a per-customer basis; too bad there are so few customers.

Cringely notes that this a Yahoo! trying to displace the per-song pricing model that has made Apple dominant. However, Cringely seems to agree with me that the major market (for both music and movies) is and will remain in the download-and-play arena, not streaming.

(sorry, can't help the exclamation thing.)

When iTunes first debuted I pointed out that Apple missed an opportunity to undercut other services on price. In a way they did offer a cheaper alternative by dropping mandatory subscription fees, but Apple's motto has always been "We'll make it good; someone else will make it cheap." This was true for the Mac, for digital music players, and for online music services.

Now comes Yahoo! Music Unlimited (beta) with the "we're cheaper" philosophy. For a monthly priced USD7 or $5/mo if you sign up for a whole year, you get unlimited streams out of a 1 million+ song catalog. (Brief news coverage here on Market-day.net)

Dowloading is also possible, for an additional $.79 per song. The downloads are touted as "burnable" but the site is extremely cagey about formats. My guess is that what they're selling are Windows audio formats because their link for players you can use goes to Windows' "Plays For Sure" page. The iPod question is also a bit confusingly answered. It appears that what they're doing will work with a Windows-linked iPod even though that's not on their list.

The DRM is even more confusing for end users, as you can read the following two sentences only a couple paragraphs apart:
Send a song to other subscribers easily
and
Yahoo! Music does not permit copying or transferring music files to other users.
Presumably "sending" is different from "copying" or "transferring" but the page doesn't even come close to explaining how. Nor why I should care.

I confess I don't see anything here that I'm willing to try to plow through, even for the admittedly throwaway price of $5/month. I can get free streams now from aggregators like Shoutcast or specialty services like Digitally Imported. And if I'm saving 20 cents per download I'd need to make 25 downloads/month just to break even with iTunes' prices.

So! Much! For! Cheap! Is! Everything!

WIRED's Xeni Jardin reports that Infinity Broadcasting will soon launch the first "all-podcast radio station." What this seems to mean is that the newly renamed KYOURadio will accept and rebroadcast streams of listener-submitted content. Of course content will be "screened" to see that it "meets FCC guidelines" - whatever the heck that means.

I'm not sure I would call this "podcasting" since it will include only broadcast and streaming - no downloading. However, it does have some interesting features, not least of which is Infinity's announced intention to use its deep pockets (it is a subsidiary of Viacom) to cover major-label music-licensing fees. This definitely falls into the "could be really good or could really suck a lot" category.

(Speaking of "suck" could someone please convince these guys that black-text-on-a-mostly-black-and-gray-background is not cool? It's stupid and unreadable.)

A long paper from Professor Ronald J Mann of UT Austin Law School attempts to analyze "the role that patents play in the software industry itself" rather than analyzing software patents per se.

You can read the abstract online; the page provides links to download the full paper (it's a hefty PDF).

Mann's main claim seems to be that patents are actually beneficial to small companies competing against larger firms. He specifically excludes "prerevenue startups" - that is, anyone too poor to afford costly patent lawyers. He also excludes most free & open software organizations and (by implication) many standards bodies, as he is concerned only with entities that attempt to make money from software development and innovation.

Mann also writes against the notion of a "patent thicket" that would intuitively act to slow innovation and constrain development by firms not themselves holding large patent portfolios. Mann argues that the industry's continued high R&D spending is evidence against such a thicket. Although this is a good point (why spend so much if you're afraid you'll get snagged by patents) it has the underlying problem of equating corporate R&D spending with software innovation. Speaking personally as someone who's been inside the software industry for a long time I can assure you there's no correlation whatsoever.

Mann has a lot more to say about IP and the software industry, including up-front attacks on the weakness of copyright (e.g. GPL) in protecting software. The article is dense and worth reading even if you disagree with some of the author's premises. In particular, it is important to consider his conclusions that patents do not have an overall large impact on the industry and that - to the extent that they do have an effect - any effect is a net benefit to small (properly defined) firms, not large.