Tag Archives: Apple

Google’s Anti-Trust problems III

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In my last two posts (one and two), I’ve been discussing the current problems as well as potential problems that will be facing Google in the antitrust arena. Yesterday I mentioned I was going to discuss Windows Media Player (WMP) and how this pertains to Google. However, I realized I need to go one step back first. First, we need to look at what happened with Netscape and Internet Explorer (IE). Initially Netscape was THE internet browser. It was the browser to program websites to be displayed on, IE wasn’t even really on the radar. Also, at this time with the web, these programs were being sent out by CD, it would take an extremely long time to down load this application. Why? because it was over a telephone line. A modem that was getting about a tenth or less of the download speed you have now with whatever your broadband connection is. That and your mom would probably pick up the phone to call some one while you were trying to download the software, or while playing War Craft 2 against a friend.

Since the medium of delivery for the browser was over CD it was a level playing field for both browsers to compete. You’d get one in the mail for whatever browser, Netscape, IE, AOL, etc. However, Microsoft realized the importance of this market. They figured out a way to leverage their desktop monopoly to foreclose on the browser market. They started installing IE onto all of their operating systems. Then went as far to integrate everything together to ensure market dominance. It worked because of slow connections and the fact that people are lazy. If something already works they will use it.

Flash forward about 5 years. MP3s have gotten popular through Napster and other digital Peer 2 Peer file transfer systems and the next big market is music players. Winamp was a major player at this time and WMP was not really any sort of competition for it either. In Windows XP WMP got a major over haul and was at least able to compete with Winamp. Microsoft decided to bundle the software in the same manner they had done with IE.

This is where the story changes though. The EU filed suite against this claiming this was anticompetitive. At this time the iPod had just come out and there was no reason to expect the product to come to the PC. It seemed like it was a long way from happening. Plus, even if the iPod was going to PC it was still going to be a niche market. So, the law suit. We all know now that because of the pace of technology and the fact that there were other factors involved with the selection of the music player it prevented market dominance of Microsoft. Without the requirement for iTunes with the iPod who knows what player would have won the market.

How does this relate to Google though? Well, looking at the search engine suit from Korea I mentioned yesterday, I think this has some pretty significant implications. Using a platform to control the method in which you use other functions can be shown to be anticompetitive. Google search engine is the first for mobile phones, however, I see no reason why it will be the last.

More on this topic in my next blog.

Disruptive technologies and long term impacts

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So what is  disruptive technology first of all? It’s any technology to causes a shift from a position of knowledge to a position of ignorance within the knowledge production community. That’s not exactly clear. No it isn’t. It’s difficult to define disruptive technologies in a manner like this. However, we all have used disruptive technologies. In the music industry there have been a large number of disruptive technologies. One is as simple as sheet music. Another is the Gramophone and vinyl records (and later turntables and receivers), then 8 tracks, cassettes, CDs, and then finally MP3s. Each of these technologies impacted society in a greatly unpredictable manner. The gramophone and records gave greater access to an amazing array of music to a wider audience. It created an entirely new market, new technologies were created to improve sound quality and increase the production rates. When the 8 track was introduced it had an impact both the home audio and car audio. It gave people access to their own music while driving. You couldn’t do that with records. Most of the knowledge that was generated with records and record players was nontransferable to 8 tracks.

What does this mean? Well it means that through disruptive innovations/technologies, we are able to create dynamism within our economy. A disruptive technology can allow for new firms to break an incumbent’s grip on a market. For instance, in consoles video games there are disruptive technologies every 5 years or so when each of the big players release a new video game system. Over the 30 some odd years of video games and console systems we’ve seen a wide range of entrants and exits. NEO GEO, Atari, Sony, Nintendo, Sega, Microsoft are some examples. Microsoft was able to take advantage of a period of disruptive technology introduction during a generation change in the technologies. This allowed Microsoft to come in at nearly a level playing field. While there was a lot of skepticism within the consumer market and within the technology industry, they were able to take advantage of their technology and get enough game producers to sign on to make games for them.

For consumers disruptive technologies lead to a chance to make a break with a previous technology producer. For instance, when new versions of Apple OS X and Windows Vista were released around the same time a consumer has a much easier time switching to a new OS when buying a new computer. If Windows Vista hadn’t come out around the time of a purchase then it would be very easy to stay with the previous Windows OS. There’s not nearly as much learning required when switching to a new computer with the same OS. However, if you have to learn a new OS, you are free to learn either OS as there are likely similar levels of learning required to actually use that OS.

In my next post I’ll discuss how these can disruptive technologies can impact firms in other ways.

Software Patents are the new Copyright

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In one of my previous posts I commented that I was seeing a convergence withing copyright activities. I believe that something just as horrible is starting to happen within the software patent world. I think that it will threaten the free software movement as well. We’ve had patent trolls around for a long time now. Almost since the first patent was created, however, this didn’t interact with our daily lives. It was similar to the way that copyright didn’t affect you and me on a daily basis. Sure, changes in prices or the removal of a product could affect us, but typically we were able to find a replacement or dealt with the price change. However, I think that this new type of patent troll is more dangerous. Yesterday I saw a post on Ars Technica discussing how Lodsys is going after Apple app developers. Apple isn’t happy about this at all, because it threatens to ruin the base they have developed.

I think there are some other problems with this as well. Historically, if a company, that produces software, was looking to go for an IPO or bought by another company there’s a thing called due dilligence, where the products are checked for stolen code. This is a big deal, because if I stole the code from Linux or some other open source software, my entire project falls under the GPL, and forces my source code to become open as well. This can create massive headaches for companies.

There is a key difference between what used to happen in the past and what is happening now. Before it was the method of making something happened that mattered. For example if I took a really fast way to sort something from open source how it was sorted was what mattered, not that it sorted. Why does this matter? Well the code is also technically copyrighted and owned by the writer. Now the outcome matters as well. What if some one had a patent on sorting. I’ve mentioned how crazy this would have been in the past and how this would impact innovation.

Let’s say some one decided to put in for a patent on shooting animals at some sort of target through a controlled interface. Once the animal hit the target the animal interacted with the target which changed the user interface to indicate that the change had occurred. I have two games on my phone right now, Angry Birds and Monkey Blaster that would both be impacted by this patent. Both of them have very different goals and methods for shooting an animal at a target and different results once it hits the target. Indeed, the definition of target is different between these two games. However, neither of these developers are going to be looking for patents when they have an idea about what’s the next game they want to make.

The patent that is mentioned in the Ars article is absurd. It should never have been approved. There’s nothing novel in the development of the in app purchase. That is something that should be obvious from any one in the computer industry. You could easily see the relationship between a website and an application. In fact, I’m sure that there have been cases of this in the past. Another question that remains to be seen is this going to impact services like Steam? The article notes that Lodsys has already gone after EA.

This change in behavior towards apps and software patents is a very bad change. We need to work to address these types of problems. Returning to the requirement of producing a product to have on the market within a certain number of years could help address these problems. However for software this will likely just lead to a crappy product put on the market that no one buys and no one knows about.

Innovation and Software Patents

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Whenever a new type of product is released there are a lot of difficulties with intellectual property. This is being played out in biotechnology and software. As recently as last year it was possible to patent human genes in the US. See this link for the recent verdict against it. The ACLU also had a write up from 2009 when this case was still ongoing about the history of genetic patenting. Software is another case of this. Many people argue that since software is an algorithm or series of statements that leads to a result it should not be patentable. This makes sense as mathematical proofs are unable to be patented. The argument is that for proofs these are discoveries and more natural processes than creating technology.

In the EU it is not possible to obtain a software patent at all. They claim that with software there are multiple different methods to obtain the same output. Software patenting is a very recent trend. The most famous example is the Amazon.com one-click to buy button. Which, if you don’t know what it is, basically allows you to store an address and a credit card and automatically buy whatever product you’re looking at. Fairly simple right? Well there was a lawsuit against a major competitor, Barnes and Noble about this in ’99. Some how this patent managed to survive the re-review, even though it’s a fairly obvious idea and could be implemented in about a billion different ways. On the billions, I’m not even exaggerating. There would be so many different interactions that could make the actual implementation totally different. These range from database types, information request, how the data is actually stored in the data base. There could be nothing similar between the implementation at all, yet Amazon ones all the methods to do this. In terms of patents this is effectively an amazing patent.

Let’s put this more simply. If software patents had been allowable in the 70’s when software first started to take off we would be living in a different world. BIOS have been owned by IBM until 1990 or so, which would have made manufacturing computers a two horse race between Apple and IBM. Microsoft or Apple could have patented the Operating system, and then the graphic user interface. IT innovation would have been non-existent. Think of this, some one could have patented data sorting. There are a many different ways to sort data in the CS world and all of them would have been covered by a single patent. Then some one could have decided to patented sorting on a multi-core computer (by then sorting as a patent would have expired).

Software is more like a mathematical proof than it’s like inventing the computer.

Innovation in the software world has been amazing because it has been something of a free for all. However, there are drawbacks to this lack of IP protection. In the most recent version of iOS, iOS5, Apple has been accused of lifting many of it’s new “innovations” from apps that have been rejected from the app store, or that have been selling in the jailbroke iPhone app store. Here’s the link for the article. How do we deal with cases like this, either Goliath stealing from David or David stealing from Goliath? There needs to be some sort of protection.

Potentially copyright should cover this, or a registered design. Perhaps in the case of the app stores a non-compete agreement should be signed if the app is rejected by Apple. Meaning Apple won’t steal it. However, there is no easy solution. Software design thefts are going to be very difficult to manage and deal with.