You Can't Take the IP Out of iPod

"The patent system added the fuel of interest to the fire of genius," — Abraham Lincoln, the only president to hold a patent.

Last week in Las Vegas, over 120,000 people attended the annual Consumer Electronics Show (search), and if Abraham Lincoln was still alive, he would have been there too.

People came from over 110 countries to see the latest product innovations from the world's leading companies. Underlying every single one of these exciting products are the protections offered to their developers by our system of patents (search), copyrights (search) and trademarks (search).

Without these intellectual property (search) (IP) protections, many of these companies would not invest billions every year to launch new waves of products. Without the protection of the patents covering the iPod (search), Apple probably would not have launched the product in the first place. And even if they did, they certainly would not have developed the iPod mini after the first version had been ripped off by counterfeiters.

In fact, just this week Apple took an important step in protecting its intellectual property by filing a lawsuit against individuals who run a Macintosh enthusiast Web site that allegedly leaked and illegally distributed the company's trade secrets.

Most people understand the need to reward artists and innovators for their creations and to respect the rights of companies to patent their innovations. Unfortunately, intellectual property rights are under attack here in the United States and abroad. We are all too familiar with the stories of bootleg DVDs on the street in Shanghai and the rampant use of pirated software (search). According to some reports, almost 98 percent of the software used in some former Soviet republics is pirated.

Countries that don't take measures to protect IP put their economy at risk. And those that support ideas that undermine IP, such as mandating the exclusive use of Open Source Software (search) over commercial software, do the same.

Closer to home, some academics have attacked our system of IP protection. Richard Stallman (search), who used to be at MIT, is a leader in the open source community and he’s a staunch opponent of the IP protections afforded commercial software companies and those in the entertainment industry.

The ideology Stallman seems to warm to might be called "cyber-socialism." Nowhere is that philosophy more obvious than in his views on the illegal duplication of commercial entertainment software liked DVDs and music CDs. He seems to feel that anyone with a CD burner has a right to duplicate commercial CDs as long as he gives them away free, never mind the royalty rights (search) of the recording artists or the investment of the recording companies.

"There has to be a minimum freedom that everyone must always have for any kind of written or artistic work," he said in a recent interview in Asia. "And that is the freedom to non-commercially distribute exact copies."

Now let's think about that for a moment. Imagine that I've got a million copies of the new U2 CD that I just copied at home. According to Stallman's definition of freedom, I've got the right to do that and hand them out free to people outside stores that sell CDs. This might be a bonanza for the U2 fans passing by that day, but it would trample on the intellectual property rights of the band and it sure wouldn’t encourage U2 to create another CD anytime soon.

Likewise, the innovators in the U.S. information technology industry won't be encouraged to roll out new generations of technology if we trade away the value of their intellectual property and replace it with the philosophy of people like Stallman.

Congress and the Bush administration have a role to play in ensuring IP protections. In the coming months they should work together to accomplish the following:

End the Patent Fee Diversion. The Patent and Trademark Office has been the victim of legislators on Capitol Hill who divert the fees the PTO collects to activities other than reviewing patent applications.

Congress did the right thing last year by allowing a fee increase for applications — something those who were paying the fees supported enthusiastically. But the increased monies won't help if the practice of diverting those funds elsewhere is not stopped. Allowing the PTO to retain these fees will go a long way to eliminating the backlog of applications for new patents and help increase the quality of patents issued.

Increase the Quality of Patents. Bad patents exist. There is no denying that. The PTO needs to ensure that patents granted in the future are for quality works. Issuing bad patents helps no one in our industry. Only litigation attorneys benefit from bad patents. Improving the quality of patents is necessary for future innovations

Tougher Enforcement of IP Protections in Trade Agreements. When negotiating new trade agreements or monitoring compliance with existing ones, we need to insist that countries increase their efforts to protect the intellectual property rights of U.S. companies. Whether it's the bootleg DVDs or pirated software, countries around the globe must take the lead in helping protect one of America's most valuable exports. They must obey the law.

Several members of Congress who attended the show in Las Vegas last week got a firsthand view of the latest in new technology. If they want to continue to see these innovations, they must help the innovators protect their works. If they don't, incentives to continue investing the billions necessary for research and development may soon dry up like the reservoirs surrounding Las Vegas.

The products that were featured in Las Vegas will bring great benefits to consumers in the years to come. These innovations will continue to revolutionize our professional and personal lives. In order to continue the success of the technology industry, we must stand firm in the protection of intellectual property, which is the cornerstone of technology.

Creativity, investment and innovation all depend on the protection of IP.

Jim Prendergast is the executive director of Americans for Technology Leadership.