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FTC: Western Digital and Hitachi must give assets and IP rights to Toshiba: Patents, Antitrust, and Competition

As I have discussed before, the state is schizophrenic. It grants monopolies aimed at limiting competition (patents and copyright), and then penalizes companies for using (“abusing”) them, in contravention of state antitrust law–so that there is a “tension” between these state laws. Then courts have to “balance” these against each other. Each state law gives the state an excuse to ratchet up its power. Here’s an idea: get rid of both antitrust and patent law.1 (Likewise, there is also a “tension” between copyright censorship, and the right to free speech.)2

A recent illustration of this can be seen in the Engadget post FTC: Western Digital and Hitachi must give assets and IP rights to Toshiba:

Thought everything was looking rosy for the hard drive hitch of the year? Well, it looks like Federal Trade Commission reckons the union of Hitachi and Western Digital isn’t quite there just yet, ordering that the new company would have to shed some of its assets to Toshiba. The FTC wants to ensure a competitive climate in the 3.5-inch hard drive market and avoid Western Digital and Seagate — the two largest HDD manufacturers — carving up the whole sector between them. According to the FTC’s proposals, Toshiba has to receive the production assets needed to equal Hitachi’s current HDD market share, alongside access to Western Digital’s research and development resources and licenses to its intellectual property. Regulators had previously stated that WD could expect to sell on some of its production assets in order to get the tie-up okayed. Western Digital now has 15 days to hand over these assets to Toshiba — who, presumably, aren’t complaining — once the deal with Hitachi is finally inked.

 So here we have the state granting patents which naturally reduces competition. That is the very point of patents.3 They give rise to oligopolized industries with barriers to competition to smaller companies and new entrants.4 The state then rides in to the rescue with its antitrust laws: laws that are created and enforced by the one true monopoly: the state; and that are enforced against private companies that are either not real monopolies5 or that have monopoly power solely by virtue of the state’s interventions in the market, such as the patent system. The solution to all this is to (a) abolish the patent system, as well as other state laws and policies that tend to give rise to monopolies or oligopolies, such as minimum wage, etc. and (b) abolish state antitrust law, which would then be superfluous (or just aim it at the state itself).
  1. See EU newsflash: patents are anticompetitive!State Antitrust (anti-monopoly) law versus state IP (pro-monopoly) lawThe Schizo Feds: Patent Monopolies and the FTC; see also When Antitrust and Patents Collide (Rambus v. FTC)Antitrust vs. Trademark LawPrice Controls, Antitrust, and PatentsIP vs. AntitrustThe Schizophrenic StateIntel v. AMD: More patent and antitrust waste. []
  2. Should Copyright Be Allowed to Override Speech Rights? []
  3. State Antitrust (anti-monopoly) law versus state IP (pro-monopoly) lawIntellectual Property Advocates Hate Competition; IP Rights as Monopolistic Grants to Overcome the Public Goods Problem. []
  4. The Microsoft-Apple Gesture OligopolyControls breed controls, Monopolies breed monopoliesThe Patent Defense League and Defensive Patent PoolingAre Patents Needed to Make Up for FDA Kneecapping?Nortel Patents Sold for $4.5 Billion to Consortium Which Includes AppleApple vs. Microsoft: Which Benefits more from Intellectual Property?Patent Cross-Licensing Creates Barriers to Entry. []
  5. See Abolish antitrust law and the real monopoly: the state. []
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To the extent possible under law, Stephan Kinsella has waived all copyright and related or neighboring rights to C4SIF. This work is published from: United States. In the event the CC0 license is unenforceable a  Creative Commons License Creative Commons Attribution 3.0 License is hereby granted.