Behind the Apple Award.

Yesterday, like most genuine innovation geeks, I was glued to my electronic device waiting to hear the verdict in the Apple v. Samsung patent infringement case in California. 

By now everyone has heard that the award was either $1.5 billion or $1.05 billion. One of the news reports is wrong. I believe the award was $1.05 billion.  

How do I know?

I was digitally connected to a person in the court room and via streaming tweets, I was kept current as the jury read each part of a multi-part verdict. I received updates every 30 seconds. It was a reporting innovation not possible only a few years ago.

I knew the verdict before it was reported in the AP alert.

The impact of this reporting made me realize how unnecessary AP reporters may become. 

Everyone with an iPhone, there is no equivalent now per the jury verdict, is a reporter. 

The newspapers have already taken a big hit with the Internet. For example,  I do not know of any one under 30 that reads the newspapers anymore, but now the news reporters may be replaced by on-the-spot reports from interested observers. That is innovation.

Regulations trump innovations.

More than 40 years ago, I published an article on Innovation Incentives in Civil Engineering magazine  The essence of the article was that Innovation had been killed by government regulations that prevented the patent holder from charging license fees that enabled the inventor to receive a reasonable return on investment. 

The premise for the article was that if a company patented an innovative process, the government required the patent holder to license it to a competitor, at a obscenely low fee, so the government could get competitive bids on the patented concept. The government typically requires competitive bids so a patented product must be licensed to a competitor to accommodate the government's bidding regulations. 

What the patent office giveth, other regulations taketh away. 

America's founders provided in the constitution a strong motivation to innovate. That incentive is being eroded by government regulations.

Do you have a similar situation in your business? Let me know.

Digestible Microchips-Innovation

The US Food and Drug Administration (FDA) has approved the first ingestible sensor. The Ingestion Event Marker (IEM), by Proteus Health, represents a new category of medical device: It is made entirely of ingredients found in food and is activated on ingestion.

The sensor resembles a grain of sand in size, is made primarily of silicon, and can be integrated into an inert pill or any other ingestible object (such as a pharmaceutical). 

A disposable patch is worn on the body to capture and relay the body's physiological response and behaviors. In addition to recording information from the sensor, the patch records heart rate, temperature, activity, and rest patterns. The patch lasts approximately 7 days and is operated by a battery, which also lasts approximately 7 days.

A mobile device is then carried in the pocket or purse to display data in context and support care.

The sensor can be used to detect the exact time medication is taken, as well as the unique identity of the medication. The information is controlled by the patient.

The IEM does not contain a battery. Instead, the fluids in the stomach power the sensor, and the body transmits the digital signal generated by the sensor. The IEM is the only ingestible sensor that is powered by the body. The sensor passes through the body similar to fiber.

You can read the full article at this link
  http://www.medscape.com/viewarticle/768665 

PARC is Innovation.. American style.

PARC, whose four-letter acronym stands for Palo Alto (Calif.) Research Center, celebrated its 40th birthday Sept. 23, 2010, with a half-day event at its San Francisco Bay area foothills campus. Now, in 2012, PARC is celebrating another milestone: the 10-year anniversary of becoming incorporated as a wholly owned yet independent subsidiary of Xerox. Currently, PARC has a long list of customers, but it still does most of its business with its parent company and government agencies. Its annual revenue is estimated at around $80 million. You may already know that many familiar IT standards were developed at PARC, including the graphical user interface for computers, laser printing, computer programming languages, Ethernet networking and VLSI circuit design. There also has been a lot of recent innovation at PARC of which you might not be aware. 

Google PARC and take a look.

Above article is courtesy of eWeek.com

A must read for the innovator.

Another dagger in Innovation's Heart.

There is a false belief that, the first innovator in, the real innovator, wins. As I recall, this was MBA dogma of the Boston Consulting Group and Morgan Stanley applied it to IPOs 20-30 years ago. 

Between 1970 to 1980, Morgan Stanley prided itself on only taking the first company in an industry public. Also, the first company often has a great idea, but takes the wrong road. See Buffalo in picture.

I worked for one of those companies so I know the story first hand. The rational was that the first company into a market space was the genuine innovator and would always dominate. In those days, we were the first in and Morgan Stanley did take us public. Poppycock now for sure. Now, the second or third entry into the market is typically the winner. 

You can research these on your own, but before MS DOS, there was CPM. Before Excel, there was Visicalc.  Before Windows, there was Apple. Before Apple, there was PARC . Before Google, there was Overture. Before many of the other tech giants, there was Bell Labs.

I could make a more extensive list, or you could, but you will find that the first mover principle has been replaced by the second or third mover, which enters the market place and forces the first mover to move over and get out of the way. 

The reasons for this are perhaps obvious to all. It is simply easier to copy things, then invent them, and when you copy things you can also improve them more economically. You can come up with some reasons on your own. The impact on innovation is negative. 

It is cheaper to be the watcher then the watchee. 

2-4-6-8 can America still innovate?

If you are genuinely interested in examining the slow demise of American  innovation and are not seduced by romanticizing the role of companies, or drawn into the unsupported cheer leading role shouting 2-4-6-8 Americans can still innovate, then you need to understand the following patent development metamorphosis.

Yes, my friends, the patent application process has morphed and not into a butterfly, but into a giant preying mantis which can devour the innovations of the unsuspecting inventor in a single bite. Here is the explanation.

Do you remember the phrase patent pending?

The phrase was placed on everything from games to pharmaceuticals to electronic devices. Companies that applied for patent protection for innovations placed the phrase there while they waited for their patent to issue. And guess what? While a patent application was pending, no one, but the patent department and the applicant could see the patent. The patent application was confidential. Rogue companies who might want to steal the patent information or look for opportunities to develop work around solutions to the patent, were denied this opportunity.

That was a good thing. And that good thing has changed.

When you apply for a patent today, within a few months anyone with a computer and access to the Internet can view the patent application. The United States Patent and Trademark Office opens their books, and your patent application to your competitors and anyone else who is mining information from the USPTO. Every technology company in the world examines this information in detail. It is a big business.

Of course America can still innovate, but the patent application information is transparent to our competitors around the world, before the patent is even issued.

Patent pending has been replaced by patent application viewing. And to you readers who missed the point, yes of course when the patent is issued everyone can see it too. But that takes several years and by that time, competitors have learned from the patent and likely improved the process. The inventor may get the patent, but it's too late to practically protect it, all theoretical legal arguments aside.

If you are in the innovation business and you do not understand the strategic import of this change, then you need to switch businesses.

Apple Patents, Samsung and Innovation.

This image is a single slide from a comprehensive slide presentation in the Apple Samsung courtroom battle. It enumerates just a few of the patents that Apple claims Samsung infringed.

There are more slides with more patent lists and more claims of infringement. It is a patent war of monumental proportions. And what is at stake is more than the issue of  who infringed who, but also the issue of American innovation in general. What price innovation, if the defense of such innovation is monstrous? Who can afford it? How many companies have the financial muscle and legal weapons to wage a legitimate defense?

As I understand it, the Apple presentation was a detailed look at Apple's portfolio of more than 3,500 patents and its focus on Google as the primary target. The 90 page presentation of which the slide shown above is only a single slide, lists 75 patents that Apple claims the Android OS infringes on.

Do not think for a moment that this level of patent litigation does not have a negative effect on innovation.The price, scale and future of American innovation is being fought in the courts. It is a worldwide battle between giant companies that have more cash than many countries. 

The battle is something to watch. If you are not following this battle as it unfolds, then you are on the innovation sidelines.

An Innovation Venue Tip.

I do not feel very innovative today. It is because I am sitting at my desk. 

I work at my desk. I am innovative in other places. 


Many people get their best ideas in the shower. I get mine when I am doing something not remotely associated with work. If I wish to go innovative, I go visit a museum. I visit an art gallery. I sit in a public library and feel historical words waft through the air. I read a patent. I watch a Will Farrel comedy routine. 


These actions vaporize the cobwebs of my brain and take me to spiritual innovation venues. I can not go innovative by desire.  For me, it is an event that naturally occurs when I release my brain from doing the daily drudgery of routine work. I change my venue and I change my thoughts. A walk in the park will often do it.


I worked with Mickey Slaughter an executive with the Kaufmann Foundation. He often said, he could not think strategically unless he was in the mountains.


Where do you think best? Plan? Innovate?

The GUTE of American Innovation

American taxpayers invest billions of dollars every year in federally funded research and development with little investment return. This book describes governmental policies, corporate and individual actions that can increase the benefits of these investments and renew the American innovation machine. The sale of the research bonds in California, while controversial in nature, is an innovative example of how targeted renewal can take place. While World War II was financed by savings bonds, the book argues for policies like innovation bonds to finance the fix of The Great Broken American Innovation Machine.


The book offers a Grand Unifying Theory and Explanation (GUTE) of extraordinary current events such as, the worlds largest and most successful computer company’s sale (IBM) of its laptop computer business to a small Chinese computer company, the annual creation of two million jobs by small businesses and the annual reduction of more than one million jobs by Fortune 500 companies. This book will help the reader understand the threats to continued American innovation in a global economy where the rule of law is the exception rather than the rule, and will provide specific methods where businesses can take advantage of gaps in the technology development process.

The book explains the rational for the coexistence of governmental policies supporting the economic benefits of job outsourcing and manufacturing by American companies in other countries with policies that could launch a renewal of the American innovation machine. The golden rule, that who has the gold rules, is true; and never truer than in the rise and fall of the American innovation machine. This book presents a compelling story laced with history, current facts and trends that affect you and your business.

This book explains how some companies, and in fact some countries, economically access billions of dollars in research and product development activities and how these companies are developing great products with razor thin product development budgets. Governmental regulations typically reward the follower and penalize the innovator. No doubt your company faces innovative gridlock. New products are expensive to develop, more expensive to defend in court and usually easier to copy than develop. The monopolies granted by the patent department are excised by the courts or by the anti-trust department. The book offers the reader suggestions how to use these facts to make the best decisions.


Contact me if you wish a copy of my book.