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  1. #1
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    Linux infringes 283 patents


    Now running HP Pavilion a6528p, with Win7 64 Bit OS.

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    Uranium Lounger
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    Re: Linux infringes 283 patents

    Seems like more proof that the patent system is antiquated as it relates to the information technology sector.
    -Mark

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    Super Moderator jscher2000's Avatar
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    Re: Linux infringes 283 patents

    I suspect that very few enterprises are candidates for this expensive insurance policy.

    One might think that by purchasing Microsoft Windows, which involves a license fee, rather than a Linux OS, which has no license fee, one is purchasing a degree of protection against patent infringement lawsuits. However, the End-User License Agreement (e.g., C:WINDOWSSYSTEM32EULA.TXT) does not provide such a warranty and tries very hard to avoid providing such a warranty, saying at most you'll get your money back for the license.

    Tough calls!

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    Re: Linux infringes 283 patents

    If I'm reading this correctly then not only hasn't it been determined whether or not Linux actually does infringe on any of the patents, but it also hasn't yet been determined that any of the patents are valid. Sounds to me like a company feeding on fear-sort of like the government.

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    Re: Linux infringes 283 patents

    All insurance feeds on fear. I should know, I'm in the business. You are scared that your house will burn down, and the insurance company is using your fear to sell you a product they hope you never use! What a deal! For them! <img src=/S/grin.gif border=0 alt=grin width=15 height=15>
    -John ... I float in liquid gardens
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    Re: Linux infringes 283 patents

    Never thought of it that way but you're right. Most of my insurance I have only because a bank requires me to. (The exception is term life insurance-I carry just enough that my wife can pay off the mortgage.)

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    Re: Linux infringes 283 patents

    That should be "term death insurance" since it does no one but the insurance company any good until you die.

    I get rid of most insurance salesmen by asking about their :death insurance" <img src=/S/evilgrin.gif border=0 alt=evilgrin width=15 height=15>

    Now running HP Pavilion a6528p, with Win7 64 Bit OS.

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    Re: Linux infringes 283 patents

    I'm always badgered about converting my term 'death' into whole 'death'. The agents always mention the savings aspect of building 'cash value'. Unfortunately for them I've had accounting training-they usually leave pretty quickly after I compare their savings with the earning I can get from investing the premium difference.

    Getting back to this Linux thing, I think we agree that nearly all insurance is a poor investment. Sometimes it's required, but that doesn't make it any better of an investment.

  9. #9
    Super Moderator jscher2000's Avatar
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    Re: Linux infringes 283 patents

    For legal risks like IP infringement, insurance really isn't an investment, it's a cost of doing business that's balanced against the unknown and probably incalculable risk of being found liable for millions of dollars and potentially going bankrupt as a result. Unless you have some way to shift that potential future cost to a third party (e.g., customers, shareholders, the government), then insurance may be the most prudent way to ensure that the company can survive such a lawsuit and stay in business.

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    Re: Linux infringes 283 patents

    I'm afraid I disagree. Money that isn't used for expenses can be invested so there really isn't any difference between an expense & an investment-the entire issue IMO boils down to the ROI. The potential ROI from an investment in insurance can be enormous-as you point out. But that's potential. When comparing ROI you really need to factor in probability. Most insurance-and this in particular-insures against low probability high expense events. I suppose it boils down to two issues-how likely you think it is that you'll lose a patent infringement lawsuit (and even moreso, one that's covered by this insurance) and how willing you are to gamble.

    Gambling is an interesting term. Some people call me a gambler because I'm willing to risk my money. But I don't consider myself such-I only risk my money after studying the odds. And then I only risk it on the 'gamble' with the best ROI-and I *always* include the option of simply holding onto my money.

    In this case the generic options would be: undertake a project using Linux without insurance, undertake the project using Linux with insurance, undertake the project using another platform, and not undertake the project at all (use the money for some other project-in which case the ROI would depend on what the other project was. That can be the trickiest to calculate so I often use a generic 'investment' ROI that assumes I've invested the money in a blue chip stock or something like that.)

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    Re: Linux infringes 283 patents

    I'm coming back and disagreeing with you in turn, calvin, in the spirit of the discussion.

    The value of insuarnce really lies in the pooling of risk over time and a large number of risk elememnts. When everyone has home insurance, but only one home in 5,000 burns down per year, effectively the risk of the single loss is pooled among all insureds over the time they hold policies. If you look into the history of insurance as we know it today, this principal, the pooling of risk among many, is how Lloyds of London got started: the syndicates were pools insuring against the loss of ships at sea.

    So the issue that Jefferson brings up is that a single entity (homeowner, shipowner, or corporation) may not be able to invest enough against the loss, but a pool of risk-accepters can.

    And I'm not trying to be apologist for the industry, just explaining some of the fundamentals of casulaty insurance. "Death" insurance fundamentals are a bit different.
    -John ... I float in liquid gardens
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  12. #12
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    Re: Linux infringes 283 patents

    I don't mind disagreement. Probability increases with time so the only thing I see in your reasoning that isn't in mine is the pooling-and the entire question of insurance is whether or not the cost of pooling is worth the benefit, i.e. ROI. If the premiums are low & the risk is high then insurance certainly has a high ROI and is worthwhile. I haven't found that to be the case however.

    While pooling spreads the risk it also spreads the cost. In my experience insurance, over time, costs at least as much as the occurrence against which it insures. Since I don't think I'm any better at calculating the odds than the insurers are I doubt if I can make any sort of profit from them-and a profit can come as easily from reduced expenses as from increased income. If the odds are good that I'll be facing a ruinous patent infringement lawsuit then the premium for insuring against that will be ruinous as well-anything else & it'll be the insurance company that goes belly up.

    If lawsuits are going to be rare enough for the insurance company to make a profit without charging a ruinous premium then the odds that I'll be facing one are also low. The basic idea of insurance is that some things are so ruinous that you should ignore the odds. I disagree-I'm always willing to place a bet on whichever side the odds favor as long as the return matches the odds. If it doesn't then it's not a fair game-and that's the way insurance looks to me.

  13. #13
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    Re: Linux infringes 283 patents

    >insurance, over time, costs at least as much as the occurrence against which it insures

    Exactly, and very well put. The question is, without insurance, can you invest enough funds before you incur the loss?

    If you ever need a job in the insurance business, give me a call! <img src=/S/laugh.gif border=0 alt=laugh width=15 height=15>
    -John ... I float in liquid gardens
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    Re: Linux infringes 283 patents

    Your analogy really doesn't work in this case. It would be like all the people living on the banks of one river pooling their flood risk!

    Leaving aside the small print, which in my experience says that insurance companies never pay out for the things that actually happen, these policies will probably either ALL have to pay out, or none of them will. What I don't expect to happen is that some Linux users will be found to have breached patent or copyright and others won't.

    StuartR

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    Re: Linux infringes 283 patents

    Stuart, in the continued spirit of discussion, people in the US can buy flood insurance, and it's usually required by lenders on property in designated flood plains. Anyone in a flood plain who doesn't buy it is taking a significant risk. Few people living on a mountainside will buy it, because of their very low risk. Effectively only the highest risk properties have the coverage. (Then there's a whole issue about post-wildfire mountainside mudslides which I can ramble on about, but that 's digressing further. I have homeowners earthquake insurance but not flood insurance. If you aren't bored yet I can go on ...)

    Returning to insurance for the Linux copyright or patent breaches, the buyers are likely to to be high risk, the insurer expects it. It is almost like known risks insurance, where the insurer purchases the liability for an event that has already occurred and the risk is known but not completely quantified: the insurer accepts the known risk and then attempts to manage the actual settlements for costs that leave them a profit.

    And what's all this whining about insurance companies not paying enough on their policies? How else am I gonna get paid? <img src=/S/laugh.gif border=0 alt=laugh width=15 height=15>
    -John ... I float in liquid gardens
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