In his 1971 science fiction novel The Futurological Congress, author Stanislaw Lem takes a dark look at the premise that most of what we see around us -- even the seemingly obvious -- is actually illusionary to some extent, and that even many people who believe that they know they underlying truths are themselves being fooled by deeper layers of reality's onion.

In the worlds of finance and high technology, there is a great deal of truth to this interpretation, and we need only look to the warped and largely destructive world of patents to realize how far we've gone astray.

Patents and related concepts have a long history, but this 1844 quote from a report to the French Chamber of Deputies in the debates preceding adoption of the French Patent Law of 1844 is noteworthy:

"Every useful discovery is, in to Kant's words 'the presentation of a service rendered to Society'. It is, therefore, just that he who has rendered this service should be compensated by Society that received it. This is an equitable result, a veritable contract or exchange that operates between the authors of a new discovery and Society. The former supply the noble products of their intelligence and Society grants to them in return the advantages of an exclusive exploitation of their discovery for a limited period."

The emphasis on "service rendered to Society" is particularly striking.

Fast forward to 2011, and the concept of "serving society" seems to have been painfully marginalized as a prime mover in the titanic patent battles and associated atrocities that are increasingly a millstone around the necks of society and consumers -- creating mainly enormous monetary and lost opportunity costs.

This sorry situation didn't appear overnight. Back in 2002, in Stop the Patent Process Madness, I briefly described the rise of stealth and protective patents, and how the enormous expansion of both software and business method patents has further distorted the picture.

Since then, I would argue that matters have gotten far worse, with patents now being explicitly wielded as weapons of financial destruction, rather than as the instruments of innovation that were originally intended to serve society.

The current very public arguing between Microsoft and Google regarding massively expensive "bundles" of patents purportedly associated with smartphone systems (and Android in particular) -- well explained and analyzed on Groklaw -- is a notable current example.

Leaving aside Microsoft's flagrant and disingenuous attempt at mischaracterizing the situation, including their obnoxious, out of context release of an email from Google that Microsoft clearly hoped would cast false aspersions on Google's motivations, the overall landscape related to high technology patents is nothing short of insane.

To use the vernacular, a "simple" DVD player involves a lot of patents. A typical PC invokes an amazingly large range of patents. And a modern smartphone can trigger a stupefyingly gigantic mountain of patents -- perhaps as many as a quarter of a million.

Notably (and especially in the smartphone case), the technical term for most of these patents is "bull" -- they shouldn't really have been granted in the first place.

But we've reached a point now where even good players feel obligated to file patents left and right in order not only to protect themselves from malevolent patent sharks, but also to try preserve openness for future developers.

If core Internet technologies had been patented decades ago in the manner that tech is patented today, I would assert that the Net we'd have now would be an enormously more closed and restricted environment -- if the Internet had even managed to really continue developing at all under such conditions.

Average consumers are largely unaware of how grossly these "layers" of the patent system not only effectively create a "tax" on the technology that they purchase, but also create such a fear of litigation that many creative individuals choose not to proceed with developing products or services that otherwise could have benefited society greatly.

There is an imperfect -- but still fairly horrifying -- analogy between the way "bundles" of patents can be treated by the unscrupulous as anticompetitive weapons, similar in some respects to how bundles of subprime mortgages were manipulated in manners that helped lead to our recent economic collapse.

Another relevant example is ICANN's atrocious "gold rush" scheme for massive generic top-level domains expansion.

In all of these cases -- patents, mortgages, domains -- the original, society-serving functional purposes of these concepts have been largely lost in the rush to treat the buying and selling of these "instrumentalities" (or related derivatives) as mechanisms mainly of financial gain for a relative few, but with society at large losing enormously as a result.

Peeling the onion down another layer, I believe that this is symptomatic of a deeper failing, an increasing tendency to value not the creation of new products and services that benefit society and consumers generally, but rather the manipulation of the systems themselves by the unscrupulous to serve greed -- forcing even the benevolent players into the game on a purely defensive basis.

A practical path out from this nightmare is not entirely clear. To call Congress dysfunctional these days is to be charitable beyond measure.

At the very least, as individuals we can try to stay informed regarding the reality of these situations -- the inner layers of the onion.

This will not only help us to see through ignoble tactics such as those employed by Microsoft in the current smartphone patents controversy, but more generally enable us to more accurately discern where many other matters of concern actually stand, and what society should be demanding from our legislators, leaders, the financial community, and major industries in general.

In Lem's Futurological Congress, most of the population lived in a carefully conceived, falsified representation of reality.

We need not follow their example.

--Lauren--