Information Technology Reference
In-Depth Information
(signed into law by President Bill
Clinton on October 28, 1998).
convenience of the regulator may
have caused irreversible damage. For
many information technology-indus-
trial categories the monopolies are in
place and are exerting control over
ideas, resources, and commercializa-
tion. While large amounts of value
were generated, much value creation
may also have been prevented.
◦
Finally the most telling example is
ironically also the most ambivalent,
and near inconclusive:
◦
Important impact was exerted by
CITI firms through a less noticed
market-institutional by-product, the
regulatory framework for intellectual
property rights. In an initial wave, it
was a defying P2P movement sym-
bolized by Napster that tried to neu-
tralize copyright.
◦
The described situation seems rather
antithetical to the spirit of informa-
tion and information technology.
While intellectual property rights
were intended to allow information
creators to secure benefits from their
innovation creation they were not
intended to allow for a comprehen-
sive position of monopoly. Granting
such a position was bestowed on the
legislator. Yet the framework for IP
is admittedly antiquated and rather
inadequately adapted from an indus-
trial world where scarce resources
necessitated allocational efficiency
and economies of scale. By judicious,
selective, and discretionary manipu-
lation of a framework that has long
overwhelmed its regulators, these
firms are taking the law in their own
hand creating
de facto
situations of-
ten stronger than authoritative law or
legitimate governance: In the name
of freedom of the Internet these or-
ganizations are increasingly restrict-
ing the functioning of industry par-
ticipants and preventing new entrants
by creating monopolies and forging
ever-faster consolidation. They are
outmaneuvering legitimate legal gov-
ernance through regulatory arbitrage
waging standard wars and sidestep-
ping due process.
◦
In an offsetting movement the exten-
sion of patent law proved even more
controversial. While it seemed a be-
nign idea initially, the framework's
extension to include business method
patents in the 1998 State Street Bank
v. Signature Financial group decision
(
ibid
.) was nothing short of a true
quantum leap in terms of legitimizing
monopoly and chilling competitive-
ness. The lobbying for this integrative
approach to patents paid off hand-
somely: Amazon leaped ahead with
a series of controversial patents such
as the One-Click-Stop-Shop, Google
patented its method of assessing rel-
evancy, and eBay snapped up the re-
packaging of trust with its seller rat-
ing application. In fact the U.S. PTO
saw rapid rise in patent applications
from 1998 to 1999 and had to change
the durational terms of patents from
17 years (as of grant) to 20 years (as
of filing) (see Alter 1999).
◦
While the recent Bilski decision (
in re
Bilski, 545 F.3d 943, 88 U.S.P.Q.2d
1385, Fed. Cir. 2008) may have ef-
fectively put an end to this period
of protective excess for intellectual
property right, it remains that the
then unthoughtful complacency and
◦
These actions rival in fact the posi-
tion of the legislator in this respect.
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