[TimGebhardt]

I would also love to have 1 sq mile of land in downtown Manhattan on which to develop a high-rise.

But I'm just a little guy. The darn property tax system is set out to screw me.

This is really the whole reason that corporations were invented: so that people could pool their resources together to achieve things that a single person could not achieve. In fact, they used to just be temporary and when the original stated project on the charter was complete then the corporation disbanded.

If a little guy company wants to own a patent under this scheme either a) they have to file the patent with a lower value so they can make the annual "property tax" but that may cap their wins in the future if it's infringed on. or b) get funding from investors to make the property tax payments. Or c) sell or license the patent to a larger entity that could benefit from it. In the case of (c) if it's truly as valuable as they say it is to the patent office then they should be able to find a suitable buyer.

Flat capped taxes on things produce market inefficiencies such as you see in the domain name arena: It costs very little to hold onto things that might be valuable one day. If instead there was a sliding scale to renew a domain based on it's value then you wouldn't really see domain squatters. They'd be forced to sell their domains to someone that could make more productive use out of the resource. Same with land and property taxes. And maybe the same for patents? I kind of like this idea.

[TimGebhardt]

@andrewcooke: There is an analogous situation to property taxes though -- Rezoning a property. If you can acquire land zoned for something cheaper like residential or agriculture and get the city to re-zone it to commercial it's almost always worth a lot more. Overnight the property is worth a lot more and the property taxes will jump, so you'll either need to get the money to develop it yourself or sell it off to a developer who can do so.

And as far as the cost of entry, there are countless fields where patents could only conceivably be filed by someone with a lot of capital: auto, aerospace, medical, pharma, etc. There are certainly lone inventors working in these spaces trying to file patents but it's unlikely they're working on stuff where you need access to enormous wind tunnels or a medical testing population.

EDIT TO ADD: And aren't we as software developers going on and on about how software patents are worth anything? The cost of entry isn't very high at all and therefore they'd be worthless. Patents were supposed to protect the little guy from losing his large up-front research and development costs to the big established guys.

[randomdata]

Patents were supposed to protect the little guy from losing his large up-front research and development costs to the big established guys.

I always understood the purpose of patents was to provide incentive to bring trade secrets out into the documented open for the long-term benefit of society by having a great body of knowledge that anyone can use. So understanding of great inventions didn't disappear with the inventor. A short-term exclusivity on using the technology was the way to provide renumeration for being willing to share your discoveries with the public.

Rubber band scrolling is a cute, even useful, discovery, but it seems like it could be duplicated by just about anyone without any knowledge of what would otherwise be trade secrets. Is that worth documenting for future generations in this way given the high social costs of taking such documentation?

[TimGebhardt]

Hmm, my comments don't really reflect this, but I agree with you. I think the end result of a system like this would be that software patents would be next-to-nothing worthless and people just wouldn't bother, except perhaps in the cases of truly innovative works of software (I can't even think of any worth patenting right now...).

Would Apple really file their rubber-band scrolling patent at a value of $1bil, then pay some multiple of that per year when it's so easily avoided by their competitors? Probably not.

And if they do then more power to them. But it would put an upper bound of the amount of silly patents that a single large company could file and maintain (think IBM, MSFT, Apple, etc). Right now it costs a company hardly nothing to file all these and maintain them but they have a huge potential upside if your competitor steps on that patent landmine.

[andrewcooke]

a little guy can't buy a plot of land in manhattan, so you're not comparing like with like: it's not the taxes that stop you from buying land in manhattan, it's the original cost of entry.

there isn't the same cost of entry for having a good idea.