The LA Times Forgot About The 80/20 Rule

I got the link for this article about patent trolls at the LA Times from the blog written by my friend and yours, Dr. Roy Schestowitz.   I’ll freely admit that I don’t read the LA Times, online or otherwise, because TMZ.  Like I need another source for what’s going on in LA LA land?  Nevertheless, it appears that right there in the title is a problem and now that I’ve read the whole article?  Well, I just can’t leave well enough alone or I wouldn’t  be, you know, me.

Let’s address first things first:

One of Silicon Valley’s favorite hobbies is complaining endlessly about the rise of “patent trolls” and how they’re destroying innovation.

I thought Silicon Valley’s favorite hobbies were drinking coffee, comparing really good quality wines and fast cars, talking about start ups who are innovating despite innovation’s being destroyed, and vying to be on the next cover of Wired magazine.   I would, evidently, be wrong about that.

Now that we’ve all wasted spent the requisite 25 minutes reading the government’s study that tells what we already knew, everyone’s trying to parse it out to mean what they want it to mean (and I include myself in that category because I have abandonment issues and don’t like to be left out).  Isn’t that how it’s done?  But I think the LA Times misses the mark here.

There’s this little rule that I learned about when I was born because my family talked about nothing but business and politics when I was growing up so I pretty much had command of the laws of supply and demand by the 3rd grade, in addition to memorizing the mantra “buy low, sell high”.  They taught us the 80/20 rule thusly:  80% of the work in any organization is done by 20% of the people.  And they also taught me that this percentage split applies almost universally across all of life:

  • 80% of the cereal in the box will be eaten by 20% of the people in the home
  • 80% of the dog’s poop will be deposited in 20% of the yard
  • 80% of your child’s most expensive toys will be played with only 20% of the time

And on and on.  But what you realize as you get older and gain more experience in life, is that what’s in that 20% is what really matters.  So while this quote may be true:

Yes, NPEs appear to be contributing to a rise in patent litigation. But overall, NPEs account for only 20% of patent litigation, according to the report.

You have to look at what that 20% is costing in terms of actual dollars, lost productivity, and lost consumer options as start up after start up is targeted and faces shuttering their business rather than pay to fight a troll.  Whether or not you believe the $29 billion dollar number, it cannot be argued that even though “only 20%” of patent litigation is from trolls, it’s not having an impact.

The article on the whole makes the same good points that most of the others have:

  1. Patent quality matters.  Shout out to Article One Partners for the awesome company tag line!
  2. Software patents in particular are problematic
  3. Legislation isn’t likely to resolve any of the real issues derived from patent trolling

It just seems disingenuous to say that since the percentage of patent litigation brought by patent trolls is only 20% of the total, it’s not really a problem.

 Chris O’Brien?  I guess we just disagree on that.



Big Data v. Intuition: And The Tie Goes To…

Is there a lot of data coming out about patent troll litigation these days or what?  Entire companies are built around the collection, analysis, and packaging of NPE litigation data so there’s clearly a market for it.

Reading this article from Wired about Big Data and what it does to the concept of a SME (which, when pronounced “smee”, is almost as much fun to say as “nastygram”), I’m struck by the balance of how much of the litigation data can be taken at face value v. how much of what we think about these guys is just pure personality driven.  For example, I don’t care much for Nathan Myhrvold.  The main reason is that he refuses to come out and say what he’s doing, even though we all know.  You just want to walk up to him and say “We can see you, Karl.  C’mon man, you’re the King of the Jungle!  You’re better than this…”  Besides which, he looks just like Daniel Hardman, the antagonist in USA Network’s brilliant legal show Suits.  Strike two, if you’re counting.

The Big Data op-ed was online, but in the current print edition of Wired, there’s an article on page 24 entitled “What If Your Gut is (Gasp) Wrong?”  I thought this was a particularly salient point, though I don’t necessarily find it applicable:

There’s so much information that it’s easy to build a case for what we wanted to do all along.

In the troll-o-sphere, I don’t think we can say that the data doesn’t point to the conclusion that there are companies out there extorting money for patents, from big and little guys alike.  So it’s not like we’ve come to that conclusion and genned up data that matched it.  But I think Colleen Chien is right, and it’s a point I’ve made as well, that litigation data does not, as her point #10 indicates, tell the whole story.  The award for the sentence with the most commas goes to:  IPTT.

I agree that Big Data can prove right over gut feelings.  Though I haven’t seen it because it is not likely to make me laugh and does not star Harrison Ford, my two criteria for any movie I’m going to spend two hours of my life on, Moneyball evidently makes this point re:  The Oakland A’s in 2002, who used pure statistics to drive player decisions and won the pennant.  Having raw data and numbers in front of your face does lead to more informed decision-making.  Point made.

But what if you can have both?  What if you can take the raw numbers and then match that with gut feelings that have been data-fied?  (When there’s not a word for what I want to say, I just make one up. That’s how I roll.)  I think you can take the raw data about litigations and you can take raw data about what happens prior to litigation and you can take softer, more gut-level data about the personalities running the trolls (and the legal teams defending them) and you can paint a very nice picture of what needs to be done to solve the problem.  By codifying  relationships in the industry you can put those gut reactions into a form that can be queried back out.

What I’m saying is that I don’t think we’re getting all the data points we need.  Start collecting the points you’re not catching now and put the screws to the data and see if you can come up with a different set of solutions to fight these guys than we have now.

I’ll end with one of my favorite quotes, and why I think Big Data v. Intuition ends in a tie:

You can lead a man to knowledge, but you can’t make him think.

Getting the data you need is only 1/2 the battle.  What you do with it is the other 1/2.

Just sayin’,


Nortel buyers, are you angry yet?

So today should be fun!   The whole world (ok, the small slice of it that follows patents) will be weighing in on Google’s recently announced purchase.  Not liking to be left out even though I have a lot of work to do, I feel compelled to add in my 50 cents.  In no particular order, save that the list is actually ordered because I like numbers rather than bullets, are my comments:

1.  What did I tell you?  If Google had wanted the Nortel patents they’d have won the auction.  They had the money, and they had this up their sleeve the whole time.

2.  Then, Google puts out the whiney-baby, “feel sorry for us” article wherein I likened them to a dude that tried to play my friend (note to playah: knock it off, or she’ll knock it off for you).  Well played, Big G.  Throw everyone off the “we’re about to buy Motorola” scent.

3.  How mad is the consortium that bought Nortel’s patents right about now?  Big G ran up the bidding and forced you all to (over)pay a ton of money.  That sent reverberations throughout the industry and forever changed the valuation of every company on the planet with a portfolio.  InterDigital, anyone?  Man, those guys had to be ecstatic!  Here’s a hint, Southern style:  when they bid pi?  You done been had.

4.  Quote from the article:

“Our acquisition of Motorola will increase competition by strengthening Google’s patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies,” Page wrote.

Again, nicely played.  So, instead of spending $4.5B on a patent portfolio alone, they are now a hardware manufacturer as well.  See how that works?  INTELLECTUAL VENTURES, I’m looking at you.

I like consistency and this purchase meets that criteria.  While recognizing that patents are required to operate in the smartphone space, broken system or not, Google chose to buy a hardware company.  Any patents Motorola has now transfer to Google so they have gotten into the manufacturing business and now hold patents that they can use to defend themselves, all in one foul swoop.  They are behaving in a way that is consistent with the message they have been putting out.  I like that.

Larry Page, for the win.

Just sayin’,