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Posted at 8:45 AM ET, 03/ 9/2011

The Circuit: Senate passes patent reform, hearing on net neutrality, Europe grapples with cookie law

By Hayley Tsukayama

LEADING THE DAY: The Senate passed a comprehensive patent reform bill in a 95-5 vote on Tuesday. The America Invents Act, among other changes, reworks the U.S. patent system to operate on a first-to-file system rather than the current first-to-invent system. It also changes the law to allow the patent office to set its own fees and to keep any fees it collects in excess of its budget for its own spending. In the past, excess fees from the patent office were given to the U.S. Treasury. The new patent system brings the United States more in line with the rest of the world. The bill had the support of many of the larger technology companies, such as IBM, but drew dissent from others including Apple, Adobe and Intel, which said the legislation did not do enough to stem litigation. Other critics, including many smaller companies in Silicon Valley, worry that the first to file system will promote a “race to the patent office” and increase the backlog of patents to be processed, a number that currently sits at 700,000.

Sen. Patrick Leahy (D-Vt.), the main sponsor of the bill, said in a news release, “The America Invents Act will promote American innovation, create American jobs and grow America’s economy, all without spending a penny of taxpayer money.  It is commonsense legislation that will help preserve America’s position as the global leader in invention and innovation.” He urged the House to pass the bill quickly.

Net neutrality hearing today: The House Energy and Commerce Communications and Technology Subcommittee will hold a hearing on the motion to disapprove of the Federal Communications Commission's net neutrality rules. In a statement yesterday, subcommittee chairmen Greg Walden (R-Ore.) and Lee Terry (R-Neb.) joined Energy and Commerce leader Fred Upton (R-Mich.) in saying that the economic analysis provided by the FCC in advance of the hearing was lacking. The FCC was asked to provide that analysis last Thursday.

European Commission cookie law: Experts in Europe say that the member countries of the European Union are completely unprepared to implement a new European law on track to take effect in May that will require all Web sites to obtain explicit permission to use cookies. As the BBC reported, the Internet Advertising Bureau in the U.K. has warned that the law is “potentially detrimental” to the country’s digital economy. One option being considered would have browsers handle the opt-in process for cookies, rather than to have consumers give explicit consent for every site, which some privacy advocates have said will substantially weaken the requirements.

Netflix stock drops after Warner Bros. distributes via Facebook: Netflix stock took a hit yesterday after Warner Bros. announced that it would be streaming some of its movies over Facebook, starting with 2006’s “The Dark Knight.” The streaming video company, which is trying to find a place in the changing telecom market, is being challenged by increasing resistance from Hollywood and competition from other sites. Warner Bros.’ early steps to distribute its own streaming Internet video straight to Facebook users using the social network’s in-network credit system might indicate a move toward eliminating the middleman. The studio said it would add more titles for rental and purchase. Many have pointed out the quality of the video is not as good as it is on dedicated streaming sites.

Twitter tweaks its new app:After facing backlash from users over new features in its official iOS app, Twitter has redesigned the application. Drawing the most ire from consumers was a gray bar that displayed trending topics, including those promoted by the site. Customers complained about ads covering messages in their Twitter streams. The micro-blogging site is struggling to figure out what its business model is, writes GigaOm executive editor Om Malik Many Twitter users now see the service as a utility, not a business. The company’s efforts to control access to its service by shutting down popular apps based on its service have been met with opposition from its users.

Bill Gates is giving away his fortune: For the second year in a row, Bill Gates will not top the list of richest people in the world, according to Forbes magazine. Reports from Reuters yesterday indicated that Gates has essentially given away his title by donating a third of his wealth to charity. Mexican billionaire Carlos Slim will take the top spot on the list again, followed by Gates and philanthropist Warren Buffett. Gates and his wife Melinda have reportedly given away $28 billion.

Slim knocked Gates to the second spot last year for only the second time since 1995.

By Hayley Tsukayama  | March 9, 2011; 8:45 AM ET
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Just because they call it “reform” doesn’t mean it is. Patent reform is a fraud on America. This bill will not do what they claim it will. What it will do is help large corporations maintain their monopolies and kill their small entity and startup competitors (which is exactly what they intended it to do) and with them the jobs they would have created. According to recent studies by the Kauffman Foundation and economists at the U.S. Census Bureau, “startups aren’t everything when it comes to job growth. They’re the only thing.” This bill is a wholesale slaughter of US jobs.

Please see for a different/opposing view on patent reform.

Posted by: 0028 | March 10, 2011 9:37 AM | Report abuse

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