Why Work? Patent your way to financial freedom!

---by Micheal

You can make a lot of money if you have a hot product that people want. Trouble is, it takes a lot of smarts to design a hot product. It takes a lot of sweat and real equity to make a product. If you hang in there for the long haul, you can make good money.

You could do all that hard work, OR you could take the easy way to riches. Be a Patent Troll. A patent troll is someone who takes out a patent for a widget with no intention of actually producing the widget. Their plan is to wait until someone else puts in the hard work actually developing and building widgets. Then, the troll sues them for patent infringement. Typically the widget-maker pays a settlement to the shadowy widget-patent troll -- like an extortion ransom -- in order to stay in business.

Why work? Patent your way to financial freedom. It's like a modern day version of the seventeenth century caribbean pirates (if you read my column last week).

A few high profile examples tell the Troll tale. eBay, the hugely successful online auction firm, was sued by some obscure outfit for infringing on their patented online payment system. RIM, the hugely successful makers of the Blackberry, was sued by some no-one firm for patent infringement. Apple has its hugely successful iPod, and gets sued by a second-tier struggling outfit because they claim they patented listing music in menus, etc. Huh?

Is all this patent troll stuff a new plague of evil on modern civilization? Was it better in the "good old days"?

No. The most famous patent troll is George B. Selden. Back in the 1870s, he could see that it was just a matter of time until the motorized "horseless carriage" came about. In 1879 he patents a basic design for four-wheeled vehicle powered by a "hydrocarbon" fuel engine. Now, Selden had no intention of actually making any automobiles. He wasn't a mechanic, nor an entrepreneur. He was a patent attorney. Surprise!

Eventually, Selden was right. Automobiles became very hot products. By about the year 1900, all across the USA and in Europe, mechanics and industrialists were inventing and building early automobiles. Gottlieb Daimler and Karl Benz were building the seeds of Mercedes. Henry Ford was tinkering with Model Ts. Ransom E. Olds was making his first Oldsmobiles, etc. etc. Almost any city of any size had its own automobile maker.

That's when the granddaddy troll sprung his trap. Selden swept in from the dark corners, announced that he owned the rights to the automobile. Everyone must pay him a royalty percentage of every automobiles they sold. Bwahaha!

At first, the patent looked solid. Many fledgling car makers knuckled under and paid Selden his "licensing fee." One brash upstart refused to pay. Henry Ford challenged the Selden patent in what turned out to be a long court battle. Ford eventually won. No one had to pay Selden license fees anymore. Everyone remembers Henry Ford. He actually made automobiles. Almost no one remembers George B. Selden, supposed "inventor" of the automobile.

Patent trolls. They're nothing new. Even though Selden eventually lost, he made a lot of money before that. Many other patent trolls have extorted their way to riches. Why work? they say. Easier to guess what someone else is likely to produce as a hot product, then wait for them to do all the heavy lifting.

America would be far better off if patents protected producers and makers instead of do-nothing pirates who lay in wait for someone else to put in the sweat equity. America needs more producers and far FAR fewer trolls.