The CMA's handling of the Xbox-ABK deal is creating a political headache for the UK government

GraniteStateColin

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Question for Jez and others in the UK: is the CMA acting on the orders of Sunak or, like many agencies in the U.S., is the CMA an entrenched bureaucracy that functions largely on its own, often against the will of your prime minister? To many of us in the US, the UK government is a black box, so we have no concept on how those decisions are reached or who within the government participates in making them.

On the high political philosophy and my opinion:
As Jez said, yeah, regulation is pretty much the antithesis of the libertarian model, so if Sunak does personally support this block on regulatory grounds, sure sounds like he's on the left, not the right (or has some ulterior motive at work). Some regulations are important, but governments almost always go way too far in their pursuit of power. In general, every regulation smothers innovation, subtracts from the economy, and hurts jobs.

Now, that's not to say that some regs aren't absolutely worth those costs and then some. I think we'd all agree that regulating to prevent dumping nuclear waste on the side of the road is probably worthwhile. At the other end of the spectrum, most of us would probably also agree that governments should not regulate what colors companies choose to make their products. Between those two extremes is where we all have different opinions.

My take on gov't regs on acquisitions: the burden of proof should be on the gov't agency to prove beyond a reasonable doubt to a court that the acquisition will break some law (e.g., forms a monopoly), not just that it doesn't adhere to some nebulous philosophical objective of the then current government preferences. If it can't prove a law will be broken, then the parties should be able to proceed with the transaction, if they both wish. The burden of proof should not be on the parties who wish to conduct a private transaction to prove the negative that they're not going to break a law as a result of the sale.
 
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Jez Corden

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@GraniteStateColin thanks for your thoughtful response.

the cma is an independent body that follows some legislative processes outlined by elected ministers. it's kinda unknown what sunak personally thinks of the abk deal block. but our "conservative" party is very much to the left of the american definitiion of conservative. they're closer to center-right, or perhaps really clsoer to true centricism, with a dash of pandering to made-up culture war outrage imported from america.

the way the uk regulatory process will play out is largely how you describe. the regulator that regulates the regulator will put a burden of proof on the CMA to prove that their block makes sense within the confines of competitive legislation. hopefully. the issue is that the people in these positions largely seem incompetent, with only a surface-level understanding of the gaming industry, what "cloud actually is", and things of this nature. it's absurd that the UK can block a deal at a gloabal level, impacting millions of gamers across the world, based on what amounts to illogic. i suspect microsoft will opt to either produce some kind of remedy in partnership with the UK government (who has ultimate authority to overrule the CMA) that will satisfy the so-called "concerns" of the market authority, while allowing the transaction to continue.

probably what will ultimately happen is UK consumers will get fucked over in the end. like usual.
 
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GraniteStateColin

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@GraniteStateColin thanks for your thoughtful response.

the cma is an independent body that follows some legislative processes outlined by elected ministers. it's kinda unknown what sunak personally thinks of the abk deal block. but our "conservative" party is very much to the left of the american definitiion of conservative. they're closer to center-right, or perhaps really clsoer to true centricism, with a dash of pandering to made-up culture war outrage imported from america.

the way the uk regulatory process will play out is largely how you describe. the regulator that regulates the regulator will put a burden of proof on the CMA to prove that their block makes sense within the confines of competitive legislation. hopefully. the issue is that the people in these positions largely seem incompetent, with only a surface-level understanding of the gaming industry, what "cloud actually is", and things of this nature. it's absurd that the UK can block a deal at a gloabal level, impacting millions of gamers across the world, based on what amounts to illogic. i suspect microsoft will opt to either produce some kind of remedy in partnership with the UK government (who has ultimate authority to overrule the CMA) that will satisfy the so-called "concerns" of the market authority, while allowing the transaction to continue.

probably what will ultimately happen is UK consumers will get fucked over in the end. like usual.
Thanks, @Jez Corden, that's great. Very helpful. I hope that between the EU rulling and MS' own tenacity, that they get this to go through.
 

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instead of focusing on its job to protect consumers by using facts and logic which will encourage investment in the UK the CMA is focused on becoming "the world's policeman on mergers".
 

LumiaWin8

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@Jez Corden
Thanks for that excellent article that looks both at the smaller and larger issues of it all.

the boost the Xbox-AKB deal would give for a "Microsoft/Xbox store for Games, Apps and more on mobile devices" would be very much welcome.
Finally adding some competition to the "Apple App Store and Google PlayStore Duopoly" in combination with the EU's digital services and platform act regulations.

Also this could also potentially allow for Microsoft to build it out it's own "Android variant" that isn't dependent on Google's whims.
 
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blaznxboxboy

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Question for Jez and others in the UK: is the CMA acting on the orders of Sunak or, like many agencies in the U.S., is the CMA an entrenched bureaucracy that functions largely on its own, often against the will of your prime minister? To many of us in the US, the UK government is a black box, so we have no concept on how those decisions are reached or who within the government participates in making them.

On the high political philosophy and my opinion:
As Jez said, yeah, regulation is pretty much the antithesis of the libertarian model, so if Sunak does personally support this block on regulatory grounds, sure sounds like he's on the left, not the right (or has some ulterior motive at work). Some regulations are important, but governments almost always go way too far in their pursuit of power. In general, every regulation smothers innovation, subtracts from the economy, and hurts jobs.

Now, that's not to say that some regs aren't absolutely worth those costs and then some. I think we'd all agree that regulating to prevent dumping nuclear waste on the side of the road is probably worthwhile. At the other end of the spectrum, most of us would probably also agree that governments should not regulate what colors companies choose to make their products. Between those two extremes is where we all have different opinions.

My take on gov't regs on acquisitions: the burden of proof should be on the gov't agency to prove beyond a reasonable doubt to a court that the acquisition will break some law (e.g., forms a monopoly), not just that it doesn't adhere to some nebulous philosophical objective of the then current government preferences. If it can't prove a law will be broken, then the parties should be able to proceed with the transaction, if they both wish. The burden of proof should not be on the parties who wish to conduct a private transaction to prove the negative that they're not going to break a law as a result of the sale.
My philosophy on regulations is very simple. If there is a negative cost to something, to society, then that thing should be regulated. Global warming is a great example. The co2 emissions has a cost to the world in rising Temps and all sorts of down stream effects. Or lead poisoning, or the cigarette smokers. I'd even go as far as saying sugary foods need to be regulated, same with processed foods. No need to ban these things unless they're dangerous, but making them more expensive is a great idea. This is where the government needs to step in and that's only to bring back balance to society and the world.

But the question comes back to other regulations that don't make sense. Things like patents, trademarks, IP laws are all government regulations and shouldn't exist. These are direct regulations of the 1A and have zero reason to exist.

These fools like Rishi aren't libertarians either. I'm a true libertarian. I don't believe in many government regulations. These fake libertarians only believe in regulations that maximize corporate profits. But you ask them how they feel about scrapping all IP laws, and suddenly they turn coat into true blue commies.
 

GraniteStateColin

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My philosophy on regulations is very simple. If there is a negative cost to something, to society, then that thing should be regulated. Global warming is a great example. The co2 emissions has a cost to the world in rising Temps and all sorts of down stream effects. Or lead poisoning, or the cigarette smokers. I'd even go as far as saying sugary foods need to be regulated, same with processed foods. No need to ban these things unless they're dangerous, but making them more expensive is a great idea. This is where the government needs to step in and that's only to bring back balance to society and the world.

But the question comes back to other regulations that don't make sense. Things like patents, trademarks, IP laws are all government regulations and shouldn't exist. These are direct regulations of the 1A and have zero reason to exist.

These fools like Rishi aren't libertarians either. I'm a true libertarian. I don't believe in many government regulations. These fake libertarians only believe in regulations that maximize corporate profits. But you ask them how they feel about scrapping all IP laws, and suddenly they turn coat into true blue commies.

Always enjoy discussing these topics, as long as we all recognize we each have our own opinions and no one gets angry at hearing alternative viewpoints. And this gets a bit afield of the topic Jez was writing about. :)

I strongly agree with parts of what you wrote, but disagree just as strongly with others. Interestingly, I also consider myself a libertarian (small L, not a partisan). I want liberty and freedom for all, with regulations only as absolutely needed, whether that's on personal liberties or business regulations. Or to put it in standard libertarian colloquial terms, I want the government to stay out of my bedroom, out of my wallet, and out of my way.

I'm a capitalist, believing that free enterprise is the best way to help the most people over time, which I would argue is not a matter of opinion, but a provable fact, with the vast majority of advances in technology, standard of living, lifespan, etc. since feudal times trace to innovations driven by profit motives. We can also see this in a snapshot in time by looking at countries that rapidly escaped third world living conditions thanks to Capitalism (Taiwan and South Korea being the strongest examples). I know some disagree. In my experience, those who disagree lack the knowledge on the relevant aspects of economic history.

I give that as background when I say that patents and IP laws are ESSENTIAL to freedom, just like all rules intended to protect private property rights, as opposed to collective or government control over property. If I invent something and I can't patent it, I effectively don't own my own thoughts or the right to monetize them. That's just another form of redistribution and socialism -- absent the ability to patent if I so choose, what I create belongs to everyone. Patent laws are effectively a contract with society: in exchange for telling everyone my idea and how to make it, I get a relatively brief (20 year) period of exclusivity to monetize my invention. After that, anyone can make it. If I don't want to share my invention, I don't have to seek a patent. I could instead keep it as a trade secret, but then I don't get the legal protection of a patent and anyone else can try to reverse engineer it and sell it without fear of a lawsuit. The patent is that trade -- teach others in exchange for legal protection against IP theft.

I also don't want regulations on everything that might have some negative consequences. That would make sense if the regulations themselves had no cost to society, but they do have a cost, a huge cost. Every regulation on businesses is a set of hurdles that smaller companies struggle to manage. The more regulations the tighter the web and tougher to start a new business. Larger companies can allocate a portion of their budget, a cost they ultimately pass along to customers raising prices across the board, to lawyers (and lobbyists) to manage these matters. For this reason, regulations almost universally help big companies by protecting them from smaller entrepreneurial upstarts who could otherwise topple their technological leadership.

Less regulation = faster technological advancement. And technological advancement benefits everyone, especially those at the lower end of the income spectrum, because technology is what drives down costs making what was once only available to kings available to all.

Therefore, I only want regulations for things that a sizeable majority agrees is a serious problem AND that can't be managed by the free market. Pollution is a good example of an area than warrants regulation. Absent regulations, a company would have an economic incentive to pollute, because of the huge cost savings to dumping and the ease of hiding that from customers who might otherwise discourage it via boycotts. A bad regulation would be that no one is allowed to buy or manufacture an incandescent bulb, something that would be perfectly controlled by the free market. *IF* most people agree that incandescent bulbs are bad, then there would be no market for them (or so small as to not be worth pursuing) and they'd fade into obsolescence. If that doesn't happen, then the people who oppose them should acknowledge that they have no right to force their product preferences on others. There is no role for direct regulation in that. (I say this as someone who doesn't own or want a single incandescent bulb; I'm all LED, all the time, but I have no right to force that product preference on anyone else.)
 
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blaznxboxboy

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Always enjoy discussing these topics, as long as we all recognize we each have our own opinions and no one gets angry at hearing alternative viewpoints. And this gets a bit afield of the topic Jez was writing about. :)

I strongly agree with parts of what you wrote, but disagree just as strongly with others. Interestingly, I also consider myself a libertarian (small L, not a partisan). I want liberty and freedom for all, with regulations only as absolutely needed, whether that's on personal liberties or business regulations. Or to put it in standard libertarian colloquial terms, I want the government to stay out of my bedroom, out of my wallet, and out of my way.

I'm a capitalist, believing that free enterprise is the best way to help the most people over time, which I would argue is not a matter of opinion, but a provable fact, with the vast majority of advances in technology, standard of living, lifespan, etc. since feudal times trace to innovations driven by profit motives. We can also see this in a snapshot in time by looking at countries that rapidly escaped third world living conditions thanks to Capitalism (Taiwan and South Korea being the strongest examples). I know some disagree. In my experience, those who disagree lack the knowledge on the relevant aspects of economic history.

I give that as background when I say that patents and IP laws are ESSENTIAL to freedom, just like all rules intended to protect private property rights, as opposed to collective or government control over property. If I invent something and I can't patent it, I effectively don't own my own thoughts or the right to monetize them. That's just another form of redistribution and socialism -- absent the ability to patent if I so choose, what I create belongs to everyone. Patent laws are effectively a contract with society: in exchange for telling everyone my idea and how to make it, I get a relatively brief (20 year) period of exclusivity to monetize my invention. After that, anyone can make it. If I don't want to share my invention, I don't have to seek a patent. I could instead keep it as a trade secret, but then I don't get the legal protection of a patent and anyone else can try to reverse engineer it and sell it without fear of a lawsuit. The patent is that trade -- teach others in exchange for legal protection against IP theft.

I also don't want regulations on everything that might have some negative consequences. That would make sense if the regulations themselves had no cost to society, but they do have a cost, a huge cost. Every regulation on businesses is a set of hurdles that smaller companies struggle to manage. The more regulations the tighter the web and tougher to start a new business. Larger companies can allocate a portion of their budget, a cost they ultimately pass along to customers raising prices across the board, to lawyers (and lobbyists) to manage these matters. For this reason, regulations almost universally help big companies by protecting them from smaller entrepreneurial upstarts who could otherwise topple their technological leadership.

Less regulation = faster technological advancement. And technological advancement benefits everyone, especially those at the lower end of the income spectrum, because technology is what drives down costs making what was once only available to kings available to all.

Therefore, I only want regulations for things that a sizeable majority agrees is a serious problem AND that can't be managed by the free market. Pollution is a good example of an area than warrants regulation. Absent regulations, a company would have an economic incentive to pollute, because of the huge cost savings to dumping and the ease of hiding that from customers who might otherwise discourage it via boycotts. A bad regulation would be that no one is allowed to buy or manufacture an incandescent bulb, something that would be perfectly controlled by the free market. *IF* most people agree that incandescent bulbs are bad, then there would be no market for them (or so small as to not be worth pursuing) and they'd fade into obsolescence. If that doesn't happen, then the people who oppose them should acknowledge that they have no right to force their product preferences on others. There is no role for direct regulation in that. (I say this as someone who doesn't own or want a single incandescent bulb; I'm all LED, all the time, but I have no right to force that product preference on anyone else.)
I'm also very much into free market capitalism, but I don't agree that government gets to decide what the definition of capitalism is. Patents and IP are all just ideas, which are all part of free speech. The question is why government should step in and protect such a thing when there's massive draw backs. For example, many of these large corporations and monopolies wouldn't exist today without these patent laws. The wealth would be more evenly spread without these commie laws. So what if you "invent" something. You didn't pull that idea out of your rear end. Every idea is built on a collection of ideas that came before it. Even if you say small companies need some protection from free speech, why should large corporations get those same benefits? You call it theft, and that is a lie. Ideas can't be stolen, they aren't property and they never will be. End of story. I love how AI is coming now and is creating all these amazing breakthroughs but shady people insist on profiting off it and even patenting it. The great thing about AI is that it was completely built from open source contributions. People who freely gave their ideas and got it built. And that AI will freely give out ideas to everyone. It's really a beautiful thing.

This is a great time to completely abolish all ip laws and let the free market work as it was intended to from the beginning. You call it socialism, I agree it's socialist to have such things like patents and IP in the first place. And many of these companies are leeching massive profits from this socialist system.

I agree with your other points. But again government needs to step in when something is causing collective damage to society if left unchecked. Water poisoning from industrial process, the pollution from plastic, the carbon emissions, acid rain, and far more things.
 

fjtorres5591

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There is an old saying about how "It is better to remain silent and be thought a fool than to speak up and confirm it."

Seems appropriate to the moment.

The CMA had already presented themselves in a poor light by accepting SONY's lies as fact until faced with unavoidable facts and witnesses before admitting MS buying APK was no threat to existing markets and pivoting to cloud gaming as an excuse to give SONY the outcome they craved. But then, when they saw the EU agree with MS, they failed to remain silent and wait out the appeal. No, they had to speak up and expose their true motivation. It's not about gaming at all. It is all about Microsoft.

"Microsoft’s proposals, accepted by the European Commission today, would allow Microsoft to set the terms and conditions for this market for the next 10 years."

Guess what, CMA? Set terms and conditions is *exactly* what market leaders do. They set the baseline for competition that competitors must match or better.
That is literally what free and open competition is about.

And when it comes to cloud gaming, where nobody is making significant money, MS is the clear leader. The EU recognized this and asked for and got assurances that MS will not be handicapping would be competitors (as SONY regularly does) and extracted terms that are if nothing else, NVIDIA and AMAZON's fondest dream: single sale cloud support.

Does anybody remember when Nvidia launched their cloud service? They intended to let their subscribers play on the cloud the games they already own. It was promptly shot down by UBISOFT and other publishers who demanded separate pay for cloud gaming under the view that playing their games on any platform required a platform specific license.

Microsoft allows buy once "PLAY ANYWHERE" between XBOX and PC on some games and now their deal with the EU requires them to do the same for cloud. All the players that already signed up with MS.
(In other words they agreed to do what they wanted to do all along.)

Such an awful, awful deal for consumers, right?
Buy a post deal Activision game, play it on XBOX, PC and your cloud provider of choice. All for the same price. "Buy once, play everywhere."

Yes, MS is setting the rules for the next decade because, who else could? Google is gone. Nvidia tried but they're at the mercy of the publishers. Amazon is years away from mattering. And the rest are at best startups hoping to find customers.

So wake up and smell the tea, CMA.
You may hate MS with a vengeance but you're on the wrong side of rationality on this one. Best shut up, let the appeal play out, and salvage a bit of dignity.

Because not only is MS is in the right here, the Activision staff, retailers, and competitors and *organized labor* are all behind MS. And so are the American politicians. Just ask the Japanese trade negotiators how their last interview played out. And last I heard, the UK desperately needs a free trade deal with the US. Which has to be signed off by the Senator from Boeing, among others.

As the headline says, picking a fight with a multinational you hate is one thing. Picking a fight with two continents *at this time* is another.

This not going to go the way of GE-HONEYWELL.
 
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GraniteStateColin

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I'm also very much into free market capitalism, but I don't agree that government gets to decide what the definition of capitalism is. Patents and IP are all just ideas, which are all part of free speech. The question is why government should step in and protect such a thing when there's massive draw backs. For example, many of these large corporations and monopolies wouldn't exist today without these patent laws. The wealth would be more evenly spread without these commie laws. So what if you "invent" something. You didn't pull that idea out of your rear end. Every idea is built on a collection of ideas that came before it. Even if you say small companies need some protection from free speech, why should large corporations get those same benefits? You call it theft, and that is a lie. Ideas can't be stolen, they aren't property and they never will be. End of story. I love how AI is coming now and is creating all these amazing breakthroughs but shady people insist on profiting off it and even patenting it. The great thing about AI is that it was completely built from open source contributions. People who freely gave their ideas and got it built. And that AI will freely give out ideas to everyone. It's really a beautiful thing.

This is a great time to completely abolish all ip laws and let the free market work as it was intended to from the beginning. You call it socialism, I agree it's socialist to have such things like patents and IP in the first place. And many of these companies are leeching massive profits from this socialist system.

I agree with your other points. But again government needs to step in when something is causing collective damage to society if left unchecked. Water poisoning from industrial process, the pollution from plastic, the carbon emissions, acid rain, and far more things.

I do agree with you on regs on water and other forms of pollution, less clear on carbon emissions, but I would concede that is an appropriate area for government, as opposed to the free market. My concern is that unilateral action on this is near useless and may have an unintended consequence of increasing CO2 emissions: if we regulate to stop it, that raises costs of business here that moves more industry to China where they have no such regulations, and CO2, unlike many other forms of pollution, is entirely global. This would suggest that the best course of action would be to come up with big rewards for big cuts, so there's an incentive, but not a cliff for companies who fail, which would just lead to relocation, increasing CO2 and hurting our economy.

On IP, I think you have a mistaken view of this based on some admittedly bad stories that have made the news. Patent trolls deserve our scorn, because they often invented nothing, but they do use the patent law to stifle innovation by others. There are ways we could legislate them into much less of a problem, or even just better enforce an existing facet of patent law: one requirement for having a patent is "diligence in reduction to practice", meaning having an idea and submitting it isn't enough, you also have to show that you are working to bring it to market. Patent trolls clearly don't do that (they claim they do in the form of peddling the idea to sell it to a company better equipped to monetize it, but that's usually a lie -- we could make those easier to catch and stop with a tiny bit of legislation).

But beyond the patent trolls, you sound like Obama's, "You didn't create that" line to entrepreneurs, which is about the most socialist thing I've ever heard. Private property rights are the keystone to capitalism. You own your property. I have no right to take it from you to redistribute it. Chief among what you own is everything that you created from scratch. A patent is NOT just an idea that could be discussed via free speech. There's a reason every first world country in the world has strong and clear patent law. They know they would quickly lose their first world status without good IP law.

There are several requirements to a patent:

1. You must include the best mode for how to make it
2. As noted above you must demonstrate diligence in reduction to practice
3. It MUST provide some business utility over all existing knowledge
4. It MUST not be obvious based on "prior art"

In spite of those, is there patent abuse? Yes, and maybe we could agree on some features to reduce that abuse, like with the patent troll point above. However, if you eliminated patents, you would put an end to most innovation and business growth. New drug development would stop (why spend $1B to develop a drug, if your competitors would just start making it right away? New chip development from Intel, nVidia, AMD, etc. would stop for the same reason -- why spend hundreds of millions to develop new silicon design or materials if the other chipmakers could just start making it too? Why would anyone back a Steve Jobs or Bill Gates or Elon Musk or any other entrepreneur if they can't protect themselves? New businesses would be limited to service businesses.

No, absent patents, the world would become a bunch of me-too low-cost production crap with no innovation. Patents drive the engines of innovation.
 

fjtorres5591

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I do agree with you on regs on water and other forms of pollution, less clear on carbon emissions, but I would concede that is an appropriate area for government, as opposed to the free market. My concern is that unilateral action on this is near useless and may have an unintended consequence of increasing CO2 emissions: if we regulate to stop it, that raises costs of business here that moves more industry to China where they have no such regulations, and CO2, unlike many other forms of pollution, is entirely global. This would suggest that the best course of action would be to come up with big rewards for big cuts, so there's an incentive, but not a cliff for companies who fail, which would just lead to relocation, increasing CO2 and hurting our economy.

On IP, I think you have a mistaken view of this based on some admittedly bad stories that have made the news. Patent trolls deserve our scorn, because they often invented nothing, but they do use the patent law to stifle innovation by others. There are ways we could legislate them into much less of a problem, or even just better enforce an existing facet of patent law: one requirement for having a patent is "diligence in reduction to practice", meaning having an idea and submitting it isn't enough, you also have to show that you are working to bring it to market. Patent trolls clearly don't do that (they claim they do in the form of peddling the idea to sell it to a company better equipped to monetize it, but that's usually a lie -- we could make those easier to catch and stop with a tiny bit of legislation).

But beyond the patent trolls, you sound like Obama's, "You didn't create that" line to entrepreneurs, which is about the most socialist thing I've ever heard. Private property rights are the keystone to capitalism. You own your property. I have no right to take it from you to redistribute it. Chief among what you own is everything that you created from scratch. A patent is NOT just an idea that could be discussed via free speech. There's a reason every first world country in the world has strong and clear patent law. They know they would quickly lose their first world status without good IP law.

There are several requirements to a patent:

1. You must include the best mode for how to make it
2. As noted above you must demonstrate diligence in reduction to practice
3. It MUST provide some business utility over all existing knowledge
4. It MUST not be obvious based on "prior art"

In spite of those, is there patent abuse? Yes, and maybe we could agree on some features to reduce that abuse, like with the patent troll point above. However, if you eliminated patents, you would put an end to most innovation and business growth. New drug development would stop (why spend $1B to develop a drug, if your competitors would just start making it right away? New chip development from Intel, nVidia, AMD, etc. would stop for the same reason -- why spend hundreds of millions to develop new silicon design or materials if the other chipmakers could just start making it too? Why would anyone back a Steve Jobs or Bill Gates or Elon Musk or any other entrepreneur if they can't protect themselves? New businesses would be limited to service businesses.

No, absent patents, the world would become a bunch of me-too low-cost production crap with no innovation. Patents drive the engines of innovation.
Carbon emissions are the kind of "problem" that will go away equally fast with and without government dishing largesse to friends of the party.

Look up Microsoft's recent deal with HELION ENERGY and Bill Gates' TERRA POWER.

Add in Tesla and other businesses in search of profit that are set to reduce emissions by over 50% in the pursuit of lucre. Faster and cheaper than idiotpoliticians™ and other ideologues.

Nothing like a few trillion bucks worth of profit to grease the solution of problems. 😎
 

jlzimmerman

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Dude, just report the facts and leave the political jabs out of it. It's already nauseating to read any news feed through the biased ramblings. Don't go there too.
 

GraniteStateColin

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Carbon emissions are the kind of "problem" that will go away equally fast with and without government dishing largesse to friends of the party.

Look up Microsoft's recent deal with HELION ENERGY and Bill Gates' TERRA POWER.

Add in Tesla and other businesses in search of profit that are set to reduce emissions by over 50% in the pursuit of lucre. Faster and cheaper than idiotpoliticians™ and other ideologues.

Nothing like a few trillion bucks worth of profit to grease the solution of problems. 😎
Maybe true. It's certainly the case that MOST things governments regulate would be addressed just fine by the free market anyway and in a more efficient way. Think of dolphin-safe tuna or improvements in factor working conditions where the laws followed the improvements by many, many years.

Historically, pollution-related functions have not followed that general truth. In economic terms, this is because the costs are far removed from the point of purchase, so it's in a company's economic interest to pollute to cut costs and gain a competitive pricing advantage against competitors. Of course, if customers en masse care about those effects and shift their purchase behaviors, paying more for the "cleaner" product, that would create a strong incentive to producers.

In my studies on this, it never quite seems to work out that way though. Some individual companies do that, whether for access to those customers who care or by the ethics of their founders or executives. But others seek to compete purely on price, which is generally a good thing, but that means they pollute to the extent the law allows if it helps drive down their costs. And pollution is particularly easy to externalize (push the costs to others) and even hide from customers, so the purchasing incentives against polluting tend to be modest.

For those reasons, as much as I am generally anti-regulations due to their high and destructive costs, I support regs where the economic incentives on their own would encourage bad behavior. Pollution, honesty in advertising and labeling and disclosure requirements (prerequisites for informed consumer behavior), and community-level zoning are examples of areas where I think the regs can do more help than harm, as long as the regs don't go too far, of course.
 

fjtorres5591

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Maybe true. It's certainly the case that MOST things governments regulate would be addressed just fine by the free market anyway and in a more efficient way. Think of dolphin-safe tuna or improvements in factor working conditions where the laws followed the improvements by many, many years.

Historically, pollution-related functions have not followed that general truth. In economic terms, this is because the costs are far removed from the point of purchase, so it's in a company's economic interest to pollute to cut costs and gain a competitive pricing advantage against competitors. Of course, if customers en masse care about those effects and shift their purchase behaviors, paying more for the "cleaner" product, that would create a strong incentive to producers.

In my studies on this, it never quite seems to work out that way though. Some individual companies do that, whether for access to those customers who care or by the ethics of their founders or executives. But others seek to compete purely on price, which is generally a good thing, but that means they pollute to the extent the law allows if it helps drive down their costs. And pollution is particularly easy to externalize (push the costs to others) and even hide from customers, so the purchasing incentives against polluting tend to be modest.

For those reasons, as much as I am generally anti-regulations due to their high and destructive costs, I support regs where the economic incentives on their own would encourage bad behavior. Pollution, honesty in advertising and labeling and disclosure requirements (prerequisites for informed consumer behavior), and community-level zoning are examples of areas where I think the regs can do more help than harm, as long as the regs don't go too far, o
Maybe true. It's certainly the case that MOST things governments regulate would be addressed just fine by the free market anyway and in a more efficient way. Think of dolphin-safe tuna or improvements in factor working conditions where the laws followed the improvements by many, many years.

Historically, pollution-related functions have not followed that general truth. In economic terms, this is because the costs are far removed from the point of purchase, so it's in a company's economic interest to pollute to cut costs and gain a competitive pricing advantage against competitors. Of course, if customers en masse care about those effects and shift their purchase behaviors, paying more for the "cleaner" product, that would create a strong incentive to producers.

In my studies on this, it never quite seems to work out that way though. Some individual companies do that, whether for access to those customers who care or by the ethics of their founders or executives. But others seek to compete purely on price, which is generally a good thing, but that means they pollute to the extent the law allows if it helps drive down their costs. And pollution is particularly easy to externalize (push the costs to others) and even hide from customers, so the purchasing incentives against polluting tend to be modest.

For those reasons, as much as I am generally anti-regulations due to their high and destructive costs, I support regs where the economic incentives on their own would encourage bad behavior. Pollution, honesty in advertising and labeling and disclosure requirements (prerequisites for informed consumer behavior), and community-level zoning are examples of areas where I think the regs can do more help than harm, as long as the regs don't go too far, of course.
"Historically, pollution-related functions have not followed that general truth. "

Actually, they did.
In both the UK and the US, air pollution was down massively from peak levels in the 19th Century long before the first activist discovered the concept of air pollution.
It came as technology switched to oil products from coal and later to gas.

If anything, the activists have hindered the switch away from fossil fuel because of nuclear-phobia. Look to the contrast between France and Germany. The first has so much carbon-free energy capacity they sell it all over the EU whereas Germany is so wedded to shutting down the nukes the bulk of their energy comes from *lignite*, the dirtiest form of coal and their current idea of progress is moving to LNG to replace russian gas. Better than nothing but far from the cleanest option.

Meanwhile, France and the UK are, like Terra Power and its other US competitors, moving to Small modular nuclear plants. That's the road to meaningful carbon reduction: technology, not pandering to the luddite mob.

Wait a few years and watch how it plays out.
 
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blaznxboxboy

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I do agree with you on regs on water and other forms of pollution, less clear on carbon emissions, but I would concede that is an appropriate area for government, as opposed to the free market. My concern is that unilateral action on this is near useless and may have an unintended consequence of increasing CO2 emissions: if we regulate to stop it, that raises costs of business here that moves more industry to China where they have no such regulations, and CO2, unlike many other forms of pollution, is entirely global. This would suggest that the best course of action would be to come up with big rewards for big cuts, so there's an incentive, but not a cliff for companies who fail, which would just lead to relocation, increasing CO2 and hurting our economy.

On IP, I think you have a mistaken view of this based on some admittedly bad stories that have made the news. Patent trolls deserve our scorn, because they often invented nothing, but they do use the patent law to stifle innovation by others. There are ways we could legislate them into much less of a problem, or even just better enforce an existing facet of patent law: one requirement for having a patent is "diligence in reduction to practice", meaning having an idea and submitting it isn't enough, you also have to show that you are working to bring it to market. Patent trolls clearly don't do that (they claim they do in the form of peddling the idea to sell it to a company better equipped to monetize it, but that's usually a lie -- we could make those easier to catch and stop with a tiny bit of legislation).

But beyond the patent trolls, you sound like Obama's, "You didn't create that" line to entrepreneurs, which is about the most socialist thing I've ever heard. Private property rights are the keystone to capitalism. You own your property. I have no right to take it from you to redistribute it. Chief among what you own is everything that you created from scratch. A patent is NOT just an idea that could be discussed via free speech. There's a reason every first world country in the world has strong and clear patent law. They know they would quickly lose their first world status without good IP law.

There are several requirements to a patent:

1. You must include the best mode for how to make it
2. As noted above you must demonstrate diligence in reduction to practice
3. It MUST provide some business utility over all existing knowledge
4. It MUST not be obvious based on "prior art"

In spite of those, is there patent abuse? Yes, and maybe we could agree on some features to reduce that abuse, like with the patent troll point above. However, if you eliminated patents, you would put an end to most innovation and business growth. New drug development would stop (why spend $1B to develop a drug, if your competitors would just start making it right away? New chip development from Intel, nVidia, AMD, etc. would stop for the same reason -- why spend hundreds of millions to develop new silicon design or materials if the other chipmakers could just start making it too? Why would anyone back a Steve Jobs or Bill Gates or Elon Musk or any other entrepreneur if they can't protect themselves? New businesses would be limited to service businesses.

No, absent patents, the world would become a bunch of me-too low-cost production crap with no innovation. Patents drive the engines of innovation.
This is a good discussion we all need to have. The disgusting state of socialist patent laws. Yes, its highly socialist, but it doesn't benefit all people, it disproportionately shifts wealth to the wealthy. Patents are a commie scam, this is true.

Yes, it's true that patent trolls are a problem, but the problem with IP laws is far deeper than the trolls. They're just one part of a broken system. The entire system itself is based on the WRONG idea that thoughts and ideas should be privatized. This goes against the fundamental principle of free speech, against the 1A. Do you agree or disagree with this point? Allowing corporations to own and restrict the use of ideas, we're stifling the 1A and suppressing innovation. Not to mention creating massive wealth inequality.

LOL at your comparison of my argument to the "You didn't create that" line. I'm not saying people don't make cool new stuff. Everything we create is built on a ton of ideas and knowledge from before, from generations and generations past. So why does one guy get to cash in on that, just because he was the last one to blow his load?

Theres tons of examples of patent abuse, for ex chevron bought the GM hybrid vehicle patent in the 70s to prevent others from building on it. How much pollution could have been saved from that if the patent scam didn't exist? Let that sink in. This is the regulation that you as a libertarian supports. Pretty disgusting if you ask me.

You seem to think that without patents, nobody would bother inventing stuff. But yeah, the internet was open sourced, so was the greatest invention made to date, which is artificial general intelligence systems. Most of our space technology was also open sourced. Innovation can't be stifled, it goes forward even with the scam IP system in place.

And about the drug development thing: a lot of that research is paid for by us, the taxpayers. But then a private company gets to sell the drug and make a ton of money. How's that for socialism lol.

You keep saying "stealing" ideas LOL. Ideas aren't property, how can it be stealing? This is free speech, plain and simple. I believe in giving people credit for their work, but not to the point where they can shut everyone else down.

IP laws are very socialist / communist, not based on free market capitalism. Let this sink in for a minute...these artificial regulations are giving government control over the distribution of ideas. In other words, they decide who gets to use an idea and who doesn't. Sounds pretty communist if you ask me. If it walks talks and quacks like a duck, then its a duck. Its not too far from soviet russia and other commie countries where the government controls and distributes resources.

What these IP laws do is that they create artificial scarcity, where one person or company controls an idea and gets to decide who can and cannot use it. This whole shtick is like socialism for the big corporations. They get to rake in the profits off of ideas that should be free for everyone. You call it protection. I call it an exclusive right that mainly benefits the wealthy and powerful. To see how fukd the system is, all you need to realize is that we have "trillion dollar" corporations, and they sure as heck wouldn't have gotten anywhere close to that without the communist patent system in place.

IP laws goes against free market and goes against free speech. They're not even capitalism, not unless you squint with one eye and are mostly drunk would you think it is. What next, they start charging you for the air you breath? Is that also capitalism? This is the fact, ideas aren't property and the sooner you admit this, the sooner you can move on with your life, my so called "libertarian" friend.
 
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GraniteStateColin

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This is a good discussion we all need to have. The disgusting state of socialist patent laws. Yes, its highly socialist, but it doesn't benefit all people, it disproportionately shifts wealth to the wealthy. Patents are a commie scam, this is true.

Yes, it's true that patent trolls are a problem, but the problem with IP laws is far deeper than the trolls. They're just one part of a broken system. The entire system itself is based on the WRONG idea that thoughts and ideas should be privatized. This goes against the fundamental principle of free speech, against the 1A. Do you agree or disagree with this point? Allowing corporations to own and restrict the use of ideas, we're stifling the 1A and suppressing innovation. Not to mention creating massive wealth inequality.

LOL at your comparison of my argument to the "You didn't create that" line. I'm not saying people don't make cool new stuff. Everything we create is built on a ton of ideas and knowledge from before, from generations and generations past. So why does one guy get to cash in on that, just because he was the last one to blow his load?

Theres tons of examples of patent abuse, for ex chevron bought the GM hybrid vehicle patent in the 70s to prevent others from building on it. How much pollution could have been saved from that if the patent scam didn't exist? Let that sink in. This is the regulation that you as a libertarian supports. Pretty disgusting if you ask me.

You seem to think that without patents, nobody would bother inventing stuff. But yeah, the internet was open sourced, so was the greatest invention made to date, which is artificial general intelligence systems. Most of our space technology was also open sourced. Innovation can't be stifled, it goes forward even with the scam IP system in place.

And about the drug development thing: a lot of that research is paid for by us, the taxpayers. But then a private company gets to sell the drug and make a ton of money. How's that for socialism lol.

You keep saying "stealing" ideas LOL. Ideas aren't property, how can it be stealing? This is free speech, plain and simple. I believe in giving people credit for their work, but not to the point where they can shut everyone else down.

IP laws are very socialist / communist, not based on free market capitalism. Let this sink in for a minute...these artificial regulations are giving government control over the distribution of ideas. In other words, they decide who gets to use an idea and who doesn't. Sounds pretty communist if you ask me. If it walks talks and quacks like a duck, then its a duck. Its not too far from soviet russia and other commie countries where the government controls and distributes resources.

What these IP laws do is that they create artificial scarcity, where one person or company controls an idea and gets to decide who can and cannot use it. This whole shtick is like socialism for the big corporations. They get to rake in the profits off of ideas that should be free for everyone. You call it protection. I call it an exclusive right that mainly benefits the wealthy and powerful. To see how fukd the system is, all you need to realize is that we have "trillion dollar" corporations, and they sure as heck wouldn't have gotten anywhere close to that without the communist patent system in place.

IP laws goes against free market and goes against free speech. They're not even capitalism, not unless you squint with one eye and are mostly drunk would you think it is. What next, they start charging you for the air you breath? Is that also capitalism? This is the fact, ideas aren't property and the sooner you admit this, the sooner you can move on with your life, my so called "libertarian" friend.

I appreciate that we both clearly believe in liberty, think socialism is bad, and capitalism good. On those points, seems like we're in solid agreement. Where we appear to diverge is purely on whether or not someone can own an invention.

To your question, no I absolutely don't agree that there's any merit at all that the First Amendment has anything to do with IP. The First Amendment protects my right to say what I want, especially in the realm of political speech. It does not enshrine my right to take your inventions. There is no rational interpretation of a right to speak, assemble, have a free press, or practice religion that says I have a right to steal your inventions (or your copyrighted work if you're an author or artist).

There are indeed examples you can cite where patents have been abused, as there are examples of abuse with nearly every positive feature of our country.

Also, I do agree that there are inventions that would have been conceived absent patent protection. The Internet is a partial example (though critical pieces of its foundation were absolutely protected by patents, including the initial routers and associated devices that enabled the Internet to transition from a military and academic tool to the mass market, and again for Wi-Fi).

Regarding drug development, no, you are mistaken. Most drug development R&D is paid by pharma companies out of profits they earn selling other patented drugs, and that would dry up almost completely without patent protection. I speak from very first-hand experience on this point. It is true that the NIH funds a huge amount of research. But a few points on that:

1. The NIH mostly funds early stage research, not specific products. Raw research is not the purview of patents. Patents ONLY cover commercial products, not raw knowledge. So, for example, the NIH funds research an how polymerase can both replicate and help catch DNA replication problems, but it does not fund efficacy or safety studies on a possible drug to treat a specific disease.

2. To the extent the NIH does fund some work that leads directly to patents (that does happen), the government generally has free right to use any patents that emerge from work it has funded. That's in the grant contracts.

3. Even the NIH and other government agencies (including DARPA who funded much of the work on the Internet) recognize the importance of patents in developing new products, as they frequently engage in private-public joint funding opportunities, where they will only match funding in a grant with existing private funding. This reduces risk to the investors who fund the private side (gov't funding lowers the effective private cost to the work) and the government knows this hugely increases the likelihood of a commercial product emerging. But the private funding would not exist absent a patent to ensure the invention can't be used by someone else who didn't pay for it.

You are absolutely correct that much software development is done with no patent protection, and there is a lot of legitimately innovative open source work done in that space. That all does serve as good examples to support your point. Interestingly, there's not much of a choice there, because it's tough to get a patent relating to software. The PTO does not consider software or algorithms patentable in most cases. There are some, like the MPEG patents (mostly expired now), and I've been in court cases relating to others, but they're particularly rare and hard to enforce in software,

In general, patents apply only to physical devices, and that's how all the software patents exist at all -- they all tie to how they control something physical, like bits being to store an image or sound on a disk and then reproduce it on a screen in the case of the MPEG patents. As soon as you get outside the significant but still relatively small world of software, you'll see that innovation is almost entirely patent driven.

Another reason this is very different outside of software is cost: while it takes some time to create software, the cost of production of test runs is effectively zero (just a trivial cost for the electricity to run it). On the other hand, the cost to produce test builds for physical devices is generally quite large, multiplied by the typical multiple iterations needed to get it right. Absent patents to protect that, they don't happen.

Say you're an entrepreneur and you have an idea to do X. Unless your family is wealthy and gives you the money, the only way you can afford to pursue it is to convince someone (an angel investor or a VC) to invest in you or the company you founded to commercialize your idea. If you have a patent, the investor sees that there's a path to make money on the invention and funds you, enabling you to proceed. If you don't have a patent, the investor knows that even if you begin to succeed, someone else will just come along with deeper pockets and steal the market from you, and therefore won't invest.

In other words, patents don't protect the big companies (much). Primarily, they protect the entrepreneur and enable him or her to compete with the big guys, or get acquired by them for access to the invention.

Patents = innovation. That's not to say that there can't be any innovation without patents, but there would be much less of it. If you think otherwise, it's only because you lack experience in that world and an understanding of how commercial R&D is funded and how new physical products come to market.
 

GraniteStateColin

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"Historically, pollution-related functions have not followed that general truth. "

Actually, they did.
In both the UK and the US, air pollution was down massively from peak levels in the 19th Century long before the first activist discovered the concept of air pollution.
It came as technology switched to oil products from coal and later to gas.

If anything, the activists have hindered the switch away from fossil fuel because of nuclear-phobia. Look to the contrast between France and Germany. The first has so much carbon-free energy capacity they sell it all over the EU whereas Germany is so wedded to shutting down the nukes the bulk of their energy comes from *lignite*, the dirtiest form of coal and their current idea of progress is moving to LNG to replace russian gas. Better than nothing but far from the cleanest option.

Meanwhile, France and the UK are, like Terra Power and its other US competitors, moving to Small modular nuclear plants. That's the road to meaningful carbon reduction: technology, not pandering to the luddite mob.

Wait a few years and watch how it plays out.

I love your perspective on this (not being sarcastic, it's not often I engage with someone who's for even freer enterprise than I am!). I do agree with all of your examples. Sadly, there are also a lot of others that go in the other direction, and often with more clearly bad forms of pollution -- factories dumping their waste byproducts directly into the river they use for power or shipping, mining companies that didn't clean up their abandoned mines, toxic waste buried in cheap steel drums that leak over time, etc.

I do think that most of those companies wouldn't do those things if customers were aware, because enough would vote with their dollars for cleaner production. I bet you and I could come with some other ways to solve these problems involving market pressures without outright banning the practices. However, if I were to put all regulations on a good-bad spectrum for cost/benefit to the most people over time, with the crazy business destroying OSHA regs and bans on incandescent light bulbs toward the bad, net-negative, end, I'd personally put those prohibiting dumping on the opposite, net-positive, end.

Personally, I think anti-pollution regs are more legit than things like minimum wages and mandated overtime, because wages are handled perfectly by the free market and minimum wages just drive inflation and make it harder for unskilled labor (including high school kids) to get jobs, but blocking pollution, within reason, does not face those problems.

Even if you disagree, I do respect your position on this. I'd always rather err on the side of the free market over too much regulation.
 
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fjtorres5591

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I love your perspective on this (not being sarcastic, it's not often I engage with someone who's for even freer enterprise than I am!). I do agree with all of your examples. Sadly, there are also a lot of others that go in the other direction, and often with more clearly bad forms of pollution -- factories dumping their waste byproducts directly into the river they use for power or shipping, mining companies that didn't clean up their abandoned mines, toxic waste buried in cheap steel drums that leak over time, etc.

I do think that most of those companies wouldn't do those things if customers were aware, because enough would vote with their dollars for cleaner production. I bet you and I could come with some other ways to solve these problems involving market pressures without outright banning the practices. However, if I were to put all regulations on a good-bad spectrum for cost/benefit to the most people over time, with the crazy business destroying OSHA regs and bans on incandescent light bulbs toward the bad, net-negative, end, I'd personally put those prohibiting dumping on the opposite, net-positive, end.

Personally, I think anti-pollution regs are more legit than things like minimum wages and mandated overtime, because wages are handled perfectly by the free market and minimum wages just drive inflation and make it harder for unskilled labor (including high school kids) to get jobs, but blocking pollution, within reason, does not face those problems.

Even if you disagree, I do respect your position on this. I'd always rather err on the side of the free market over too much regulation.
The problem with regulation (and industrial policy) is that by turning control of (segments of) the economy to politicians and their appointed regulators you ensure an uneven playing field favoring "the friends of the party". Examples abound: SOLYNDRA. The EV subsidies first floated by the gerontoracy meant to go to UAW companies and exclude the company manufacturing 80% of EVs. Or how about keping SpaceX from launching any form of STARSHIP until Boeing launched something, anything. And then demanding they write a term paper and give money to an NGO with friends at FAA, among other things. Or how about the Government Motors mess that made FORD mortgage everything up to and including their brand? They're still hobbled by the deal agreed to by GM's union owners with...themselves.

Mind you, I'm not proposing lassez faire by any means. (In today's world of internet communications and whistleblower laws only the FBI can hide their malfeasance and only for a while.)

But I think there is a big difference between quality control regulation (DOA, FDA, FCC) and lobbyists buying the power of regulators to harm competitors.

(I assume you're familiar with the ARS TECHNICA expose of the ULA emails from 2021? How does that kind of coluxion serve any public purpose? Yes, they delayed the evolution of the space launch SOTA by two years but it did nothing to fix ULA's broken business which is now looking for a buyer.)

The CMA situation is just one example of many of incompetents "regulating" affairs they have no business being involved in.

And there's still the mess at the FTC where the ideologue in chief/congresswoman-in-waiting is trying to run out the clock on a drsl the entire agency staff knows is supported by all affected.

So no, no laissez faire, but common sense rules.
Fair 'nough?
 

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