FISL Talk “Powerful v. Empowered”

During the FISL12 conference last week, I had the opportunity to present a keynote entitled “Powerful v. Empowered – Threats to the Open Web.” The talk examines the threats, the drivers,  and how we can make a difference. The prezo can be found here: FISL Prezo Final. The FISL community was pretty awesome. There’s something about their approach and perspective that had a delicate and thoughtful quality that was really impressive.

Preliminary Comments for Senate Commerce Committee Hearing on DNT

This Thursday, the US Senate Committee on Commerce, Science and Transportation is holding a hearing entitled “The Need for Privacy Protections: Is Self-Regulation Adequate?” Mozilla along with several others have been asked to comment at the hearing on the current state of: i) industry self-regulation; ii) Mozilla’s Do Not Track feature; and iii) the industry’s ability to provide consumers with adequate tools to protect their personal information online.

We’re planning to participate and provide comments based on our experience and perspective. We also posted the questions to governance for input.

In addition to core Mozilla messages about user choice, control, and transparency, the comments will include the following key key points:

  • Industry self-regulation can work when it’s a multi-stakeholder process that reflects the views of all of the relevant parties involved in data transactions including users, developers, service providers, publishers, and the ad networks.
  • Non-voluntary regulatory measures are a last resort. They can introduce unintended consequences that can be harmful to a fragile web ecosystem. As a result we should be cautious in this regard and give voluntary industry efforts every chance to succeed before interceding with regulation.
  • The desire to predict and deliver content that appeals to users is a core driver behind efforts to collect and analyze data about us. This will only increase particularly with the inclusion of the mobile data graph. This is not inherently bad, and delivering content that users want, when they want it, is a good thing if it’s done transparently and in harmony with user intent.
  • Commerce is a vital and beneficial Internet activity. Enabling and maintaining economic ecosystems on the web is essential to a robust and healthy Internet. Commercial imperatives and user choice/control are not mutually exclusive. They can and must coexist through a combination of technical capabilities and user-centric business and data practices.
  • DNT requires cooperative efforts of services providers, ad networks, browsers, and other parts of the web ecosystem. We’re optimistic that the multi-stakeholder process ongoing at the W3C will result in a consensus on both the meaning of DNT and how websites should respond.
  • DNT is one method to give users a voice in how third parties collect, use, and track information about them. It’s not the only method, nor the be all and end all of the data and privacy relationship that exists between users and service providers.

We’re in the process of completing the comments now and will submit them in advance of the hearing on Wednesday.

Patent Matters – Don’t Hate the Player, Hate the Game

The recent acquisition of the Netscape/AOL patent portfolio reminded me that an update on Mozilla’s patent strategy is long overdue. This post is about what we’ve done and what we could/should do in the future.

As you may have seen, there’s been a lot of patent litigation activity lately. The Yahoo suit against Facebook is one of the most surprising – at least to me. And the US Supreme Court just recently weighed in to re-affirm a long held axiom of patent jurisprudence that laws of nature are not patentable subject matter, so the judiciary is getting more active as well.

What’s driving the increase of patent activity? There are numerous drivers in my view including increased competition in the mobile space, the desire for competitive advantage particularly if a company is struggling in the market, and demands for incremental license revenues. Invariably, patent portfolios become more attractive tools for revenue and market competition when a business is not doing well or threatened.

The traditional strategy has been for each company to develop the largest possible patent portfolio to act as a deterrent against potential plaintiffs. This is known as a defensive approach. Others make no such claim at all, and still others do a bit of both depending on the circumstances. For early stage companies and start-ups, patent rights may also be important. If the business fails in the market, IP rights may turn out to be the most valuable asset for investors.

I personally struggle with the effectiveness of “build a big patent pool” as a one size fits all approach. It may not work if you’re way behind in the game or even conflicted about software patents. Also, if done organically, it simply takes too long. In other settings it may however make perfect sense, especially with enough resources and sufficient inventive material that is relevant to your competitors. I got to do this for a few years in my first in-house counsel job working for Mitchell Baker long ago where I was tasked with creating the initial Netscape patent portfolio.

So far Mozilla has not adopted the traditional strategy. A while back we made an exception to file four patent applications on some novel digital audio and video compression codecs co-invented with a contributor at the time. We assigned those applications to xiph.org, a non-profit focused on open video and audio codecs. The assignment included a defensive patent provision which prevents the patent from being used offensively. One of those applications has been published for examination as part of the standard USPTO patent application process. We believe that these applications may help in standards settings so we could achieve a better open standard for audio codecs. For better or worse, in the standards bodies participants use their IP to influence the standards and without some leverage, you’re left only with moral and technical arguments. We’ll see if our theory plays out in the future.

We haven’t filed other applications yet, but I don’t think the past should necessarily dictate the future. I can imagine many places where inventive developments are occurring that have strategic value to the industry, and where we want those protocols, techniques, and designs to stay open and royalty-free to the extent they are essential parts of a robust web platform. Ofcourse filing patent applications is one possible technique, but at those strategic intersections, I think we should entertain filing patent applications as one tool in our overall strategy.

In addition to patent filing strategies, there are other things we could  do including:

  • Adopting techniques to constrain offensive use, like the Inventors Patent Assignment with defensive use terms proposed by Twitter today. (+1 for Ben and Amac at Twitter for this)
  • Building out a robust defensive publication program. IBM wrote the book on this, maybe its time to make source code publications work the same way.
  • Developing an ongoing working prior art system available for defendants. We worked on a version of this a few years back, but the urgent beat out the important and no progress has been made since then.
  • Pooling patents with other like minded groups into safe pro-web entities with defensive protections. The pools need to be relevant to competitive threats for this to have value in my view.
  • Creating other disincentives to the offensive use of patents (similar to the MPL defensive patent provision) but relevant to larger parts of the web.

Sometime mid-year, I’d like to have a broader discussion to brainstorm further and prioritize efforts. Nonetheless, I’m pretty confident that given the changing landscape and markets, we’ll need to play in this domain more significantly one way or the other.

Microsoft acquisition of Netscape/AOL patents

As reported in the news this week, Microsoft acquired some 800 patents from AOL for a billion dollars. A few people have asked what this means for Mozilla. At present, I don’t believe that the acquisition poses an immediate danger to Mozilla.

There are many possible motivations for the acquisition including reducing exposure, preventing others from obtaining the patents, increasing your portfolio size and quality, using them for cross-licensing, or even patent license programs. We’ll never know for sure, but viewing this acquisition in the broader context of the patent battle playing out across the tech sector, it makes sense for strategic reasons.

Certainly Google, Apple, and Microsoft are key competitors in this battle, and Google recently increased its portfolio size dramatically with the acquisition of 17,000 Motorola patents. Other players hold thousands of patents as well, topped out by IBM with 6,000+ new US patents in 2011 alone. Obtaining a huge chunk of patents and licenses in one move, saving time along the way, makes sense for broader reasons, and in this context it is hard to imagine it’s driven by anything related to Mozilla. Frankly, there are easier ways to influence the market without near the attention or the cost.

In this particular case, it would seem that the exposure is even lower because portions of the Mozilla code base are already licensed under some set of these patents. Early code contributions from Netscape to the Mozilla project came with patent licenses from Netscape/AOL via the Mozilla Public License. These licenses are still in play. For example, the first granted Netscape patent was for HTTPS as I recall. To the extent this is implemented in the Firefox browser or Thunderbird code bases by Netscape/AOL (and subsequently the Mozilla code base) patent grants would flow with the code under the MPL. The express MPL patent grant, which didn’t exist in other open source license at the time, finally sees its day.

Overall, while this acquisition is certainly surreal for many Mozilla folks that worked at Netscape including those who are inventors for some of the patents, I don’t view this as a threatening move in and of itself. Patent holders like Microsoft and Google are generally considered more predictable, subject to market and ecosystem pressures, and more often than not, targets of patent litigation themselves. That being said, Yahoo did sue Facebook, so conventional wisdom may no longer apply these days.

I believe the real threat is what ultimately happens with the patents. If Microsoft maintains ownership of the patents, on the margins, it is better than having them sold off piecemeal to non-practicing entities, often called IP trolls. If they end up in the wild, it’s not a good thing. We will need to watch this carefully.

It would be great to see Microsoft express its intentions in this regard or put some protections around the portfolio if it transfers the patents. This could alleviate many of the concerns raised by the transaction.

Comments supporting DMCA jailbreaking exemption

Every three years the US Copyright office, examines whether it will renew certain exemptions to the DMCA. In 2009 we submitted arguments supporting the EFF’s petition for the exemption of  jailbreaking from the DMCA. The Copyright office granted the exemption in 2010 which now expires at the end of 2012.

Although it seems a bit silly to have to do this every three years, we’re going to again file a brief supporting the exemption for jailbreaking, also known as “rooting.” EFF has more information here on the arguments and the process.

Based on feedback from developers around the Mozilla project, the brief will contend that rooting is important because it’s necessary to achieve competitive application performance on Android mobile platforms, to effectively debug applications, and for regression testing.  In addition, it’s even more critical now as mobile devices surpass desktop, and Internet access increasingly comes from mobile platforms.

We plan to file our comments on Friday afternoon. If you have ideas or thoughts that could be incorporated in the brief, please let us know. Alternatively, you can file your own comments, or if your flavor is petitions go here.

the Open Act, What others are saying…

Although it’s great to have a POV, it’s also good to hear what the other side is saying from time to time. This is a handout going around the Hill distributed by pro-sopa interests.

…………………………………………………………………………………………………………………

THE OPEN ACT GOOD FOR GOOGLE BAD FOR COPYRIGHT HOLDERS

Everyone agrees that foreign criminal Internet operators who steal American products and jobs must be stopped. No legitimate Internet service should profit from illegal activity or lead its users to illegal sites. The OPEN Act does nothing to stop this behavior and may even make the problem worse. It does not establish a workable framework, standards or remedies. It is not supported by those it purports to protect. It needs to be scrapped. Stakeholders and Congress need to start over with a fresh look at solving this problem.

Sets dangerous precedents with impossibly high, useless standards. Even a site that openly acknowledges it is entirely composed of illegal material is exempt, as long as the material is added or used by others and not the site owner or operator. This excuses willful blindness and outright complicity in illegal activity. In addition, anyone who takes down one illegal file is immune, even if it’s simply reposted minutes later. Couple these with the virtually impossible requirement to prove that the owner or operator of an elusive foreign site acted willfully, and the OPEN Act remains closed to nearly any claim, but serves as an excuse that something is being done.

Prohibits small business victims from seeking relief. OPEN Act claimants would be required to hire a lawyer with International Trade Commission expertise (among the most expensive bars in the country), come to D.C. to pursue the claim, and post a bond for the issuance of a cease and desist order (that they may not get back). This puts justice out of reach for small business American victims of IP theft.

Allows indefinite delays while the market for American works are “scooped” by foreign criminals. The OPEN Act provides no timing for initiation of an investigation, if an investigation is granted at all. A claim could languish for months or years before any action is taken. And, while the bill requires the ITC to rule on an injunction within 30 days after the start of any investigation, there is absolutely no timing given for the ruling on a temporary cease and desist order – what the bill ironically calls “expedited consideration.” Add on provisions for endless submissions by parties such as Google, hearings, etc., and relief is elusive for victims suffering while foreign site operators are allowed to continue their illegal activity.

Offers an empty toolbox. Typically, when illegal activity is found, the law provides for action against the activity itself. OPEN prohibits action against the site, and doesn’t allow the ITC’s standard exclusion order (available in other ITC claims). OPEN takes away the very tools the ITC has been granted. The relief is so limited it applies only to ad networks that directly share ad revenues with the criminal site (rendering more complicated revenue relationships immune) and only payment processors that transact with customers in the U.S. (allowing transactions for foreign rogue sites to continue with international customers by U.S. providers). And, of course, the White House can throw out an order for any reason, trumping an administrative decision with a political one.

Makes compliance rare. The OPEN Act actually prohibits claimants from seeking a compliance order from the ITC. Instead, it allows only the Attorney General of the U.S. to bring an action against anyone who ignores an order. The victim is left powerless to ensure compliance even if they win.

It’s anticompetitive. The bill’s narrow view of financial transaction provider and Internet advertising service conveniently exempt services such as Google Wallet and Google’s Doubleclick, but include Visa and MasterCard. And, further benefitting Google which has 90% of the search market on the Internet, the bill completely exempts search engines from any responsibility.

The OPEN Act is an excuse, not an answer.

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