What happens when technology companies win patent disputes?

The New York Times talks to some legal analysts today who discuss what happens when technology companies win patent disputes.  Take the case of Tivo vs. EchoStar:

Jonathan Zittrain, a professor at Harvard Law School, outlines a similar case in his book “The Future of the Internet — and How to Stop It.” In 2004, TiVo sued the satellite TV distributor EchoStar, accusing the company of infringing on its patent on DVR technology. After some drawn-out litigation, TiVo ended up winning the case, and a Texas judge ordered EchoStar to disable the DVR functions on most of its set-top boxes. An appeals court is reviewing the matter.

“The judge simply ordered EchoStar to connect to the DVR boxes via the Web and destroy the functionality,” Mr. Zittrain told me in an interview. “Patent law is a completely different universe online. That means if the court were to side with Apple and issue an injunction that insists HTC kill the phone, or at least some of its functionality, they easily could.”

That is one end of the spectrum and not likely to be the outcome of this particular case (but it would be somewhat entertaining to watch Android users avoid getting the "Kill multi-touch" update). 

Zittrain (OMG high school must've been rough) believes Apple is going after HTC because they have a much smaller war chest than Google.

“It clearly involves some form of litigation strategy of picking off the weaker members of the herd first.  They can always add Google to the suit later on.”

Most lawyers that the Times spoke to believe the case will be settled out of court, partilly because of what happened with RIM and almost getting shut down after losing a Patent battle a few years ago.

“BlackBerry owners were going to have their phones shut down as a result of R.I.M.’s patent infringement.” In the end R.I.M. settled.

These cases usually take 5-10 years to come to a resolution (That is about five generations of phones!) and only 5% of these types of cases ever reach court because the costs are way too high, even for a company as rich as Apple.  And that shows the real problem with the patent system:

“It’s a bad scene right now. The social value of patents was supposed to be to encourage innovation — that’s what society gets out of it.  The net effect is that they decrease innovation, and in the end, the public loses out.”