Posts Tagged ‘Cybersecurity’

Update on America’s Slipping Global Competitiveness– Implications for Intellectual Property Development of Senate Bill 515

ot_logoThis morning I gave the keynote speech at the ICAP Ocean Tomo IP auction in San Francisco.  My remarks explained the relationship between the long-term decline in America’s global competitiveness, the impact of the capital markets crisis on new investment in research and development, and specifically addressed Senate Bill 515, the pending U.S. legislation that will transform the U.S. patent system and broadly impact intellectual property rights in our country.  Some excerpts follow, and you can download the entire speech and slides by clicking at the bottom of this post:

“The absence of cohesion in American public policy can be seen in many areas—with cybersecurity coming immediately to mind.  Mike McConnell, former director of the National Security Agency, recently wrote an opinion piece in the Washington Post on why the U.S. is losing the cyber war, commenting that “The problem is not one of resources; even in our current fiscal straits, we can afford to upgrade our defenses. The problem is that we lack a cohesive strategy to meet this challenge.

This lack of cohesiveness comes from short-term thinking that has become prevalent in many aspects of American society.   The notion that “posterity doesn’t matter” has unfortunately taken root in our country, and this has led to fragmented approaches to public policy solutions across the board, corroded leadership among our elected representatives, and contributed to an entitlement culture and a lack of accountability that permeate much of American society.”

“The key obstacle to moving [patent] reform forward continues to be disagreement between several large high-tech companies, namely the group of Cisco, Microsoft, Hewlett Packard, and Intel, on the one hand, and life sciences organizations such as PhRma, BIO, MDMA, AdvaMed, Universities, several union groups, the NVCA, and others, on the other hand, over the idea of creating a new post-grant review procedure within the PTO and over the proposal on apportionment of damages in infringement cases.

As we consider the broad implications of this polarizing issue, we must first step back and remember that inventors and investors devote time, energy and risk capital to innovate new products and technologies.  Since the drafting of our country’s Constitution and even well prior to the establishment of the United States, it was understood that the greater good was served with a patent system that encourages this type of risk taking by protecting inventions resulting from innovation.  It is also understood, though in our country it appears to have been forgotten, that innovation, and job creation, come not just from large, well-funded enterprises, but in large part result from the efforts of small companies and individuals laboring to make a better mouse trap.

The core principles underlying the patent system have not changed.  We need to encourage and reward those that take risk to innovate new products, services and technologies.  Unfortunately, the patent system that served us so well for so long is under assault.  The cost of filing patents has increased dramatically.  The cost of enforcing patents has gone through the roof.  Injunctions have been taken away except for cases of head-to-head competition in the patented item.  Patents are now easier to invalidate after-the-fact.  A patent holder can no longer offer his/her patents for license without putting himself/herself at risk of litigation that he/she may not be able to afford.  Innovation involving patents has become a rich-man’s game, with an increasingly uncertain chance of return.

At a high level, we need to understand that anything that changes our patent system creates winners and losers.  In general, changes that weaken the patent system hurt inventors and innovators, while benefiting large companies with established market positions (e.g., monopolists) and low cost producers (e.g., offshore companies with lower labor costs, fixed currencies and weaker environmental standards).

Some argue for changes in the patent system based on a claim that non-practicing entities, often pejoratively called trolls, have too much power.  Some extraordinary examples, such as NTP seeking an injunction that would shut down Congress’ use of Blackberrys and some high dollar jury awards and settlements, have been cited by some as sufficient reason to argue for a radical restructuring of the way that patents are filed, challenged and enforced in court.

We need balance in this process, as changes may have the unintended affect of hurting those that we need now more than ever – inventors, entrepreneurs and investors that will innovate and create jobs here in the U.S.”

For a full transcript of the speech, including the slides, CLICK HERE.

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Keynote Speech at the Global Security Challenge, Chicago, September 22

imagesI will be the keynote speaker at the America Midwest Regional Final competition of the Global Security Challenge (GSC) on September 22nd in Chicago.  This event is part of a global competition to deliver innovative solutions to pressing cybersecurity problems.  The GSC Security Summit 2009, which will be held November 13 in London, will see the culmination of the six regional finals held around the world in September and October.  The Summit will include the final pitches from each regional finalist in the SME and Start-up categories, as well as the ‘Dragon’s Den’ style closed-door Q&A with the expert Judging Committees. The award categories are:

  • Best Security SME
  • Most Promising Security Start-up
  • Most Promising Security Idea

Top contenders from previous Global Security Challenge competitions have subsequently raised over $55 million in new capital.  The current open competition is for the “Most Promising Security Idea”:

The GSC committee recognizes that there are many potentially disruptive innovations that have yet to reach commercialization. Through the Most Promising Security Idea category, the GSC encourages innovators to continue to pursue their ideas and efforts. The award is designed to support and promote researchers, infant companies (with no revenue), and any other inventors who just have an idea for a security solution.

The winners of this category will receive:

  • $10,000 cash grant, sponsored by Accenture.
  • Mentorship from Mark Shaheen, managing director of Civitas Group.
  • Unparalleled networking opportunity with government officials and industry leaders.
  • Invaluable publicity.
  • Examples of our areas of interest are (but are not limited to): biometrics, detection sensors, cyber security, video surveillance, RFID, personnel protection, encryption software, data-mining, biotechnologies, and explosive trace detection. Who can Apply?: Eligible entrants must be a company, or one or more individuals, whose idea did not generate revenue in 2008.Deadline for Submissions: September 1, 2009 at 11.59 GMT.

For more information on the GSC CLICK HERE.  I am proud to be involved with this competition as it represents the type of innovation challenge that drives entrepreneurs to develop breakthrough ideas into real companies.

Setbacks in White House and DHS Organizational Responses to Securing Critical Infrastructure—a Troubling Trend?

images-3Organizational challenges and governance questions appear to be gaining the upper hand in faltering efforts by the White House and DHS to address America’s cybersecurity.  Last week two respected leaders in the cybersecurity realm, Melissa Hathaway of the White House and Mischel Kwon of the Department of Homeland Security Computer Emergency Response Team (DHS CERT), announced their resignations.

Below I quote from reports by the Wall Street Journal and the Washington Post:

From the WSJ’s Siobhan Gordon on Melissa Hathaway, reported on August 4, 2009:

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The White House’s acting cybersecurity czar announced her resignation Monday, in a setback to the Obama administration’s    efforts to better protect the computer networks critical to national security and the global economy. The resignation of Melissa Hathaway, Barack Obama’s choice to monitor the nation’s online security, is a blow for the administration, which had made the position a priority. The resignation highlights the difficulty the White House has had following through on its cybersecurity effort.  In February, the White House tapped Ms. Hathaway, a senior intelligence official who had launched President George W. Bush’s cybersecurity initiative, to lead a 60-day cybersecurity policy review. Ms. Hathaway completed her review in April, but the White House spent another 60 days debating the wording of her report and how to structure the White House cyber post.  National Economic Adviser Larry Summers argued forcefully that his team should have a say in the work of the new cyber official.  The result was a cybersecurity official who would report both to the National Security Council and the National Economic Council. Supporters said that arrangement would cement cybersecurity as a critical security and economic issue; detractors said it would require the new official to please too many masters and would accomplish little.  “It’s almost like the system has become paralyzed,” said Tom Kellermann, a former World Bank cybersecurity official who served on a commission whose work influenced the White House’s cyber planning.

From the Washington Post’s Ellen Nakashima, reported on August 8, 2009:

images-1Mischel Kwon, the director of the Department of Homeland Security’s U.S. Computer Emergency Readiness Team, submitted her resignation letter this week. … Kwon, who is the fourth US-CERT director in five years, was frustrated by bureaucratic obstacles and a lack of authority to fulfill her mission, according to colleagues who spoke on the condition of anonymity.  In March, another Homeland Security cybersecurity official, Rod Beckstrom, resigned, citing a lack of support inside the agency and what he described as a power grab by the National Security Agency.  The resignations, although unrelated, point to a larger inability of the federal government to hire, retain and effectively utilize qualified personnel, experts said.

[Note: Beckstrom has recently become the CEO of ICANN]

While these resignations do send a message, we must be equally concerned about positions that get less daily press but are equally critical because they deal with the details of policy implementation.   In my view, the fact that we are now seeing departures from people who are in critical execution positions raises a red flag, particularly because it appears that organizational dysfunction and lack of coordinated leadership are at the root of these departures.  From government’s perspective, the cybersecurity problem is difficult to address effectively because it is widespread, new, and amorphous relative to other types of criminal activity (for example, a bank robbery by an armed gunman).  It also crosses many disciplines and therefore touches multiple competing government bureaucracies.

Our nation’s policy leaders need support from empowered lieutenants to execute on policy. As a nation, we cannot afford to take our collective eye off the ball as we address the challenges faced by the U.S. economy, the U.S. capital markets, and America’s cybersecurity.  President Obama’s ambitious agenda will stand or fall on the ability of people to implement the Vision.  While critics are quick to seize upon the Administration’s mis-steps, whether you support the Administration or not, we should all be very concerned when we see highly respected domain experts voting with their feet.

The vast scope of the cybersecurity challenge and the urgency with which we must address it present us with opportunities to contribute at many levels. Let’s not stand down but rather rise up to meet this challenge head on, even if we must do so incrementally.