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Now it's not only the largest tech companies in the world building their own data center infrastructure from scratch. If LinkedIn is any indication, mid-sized tech companies are also beginning to catch on to the trend. Via Business Insider:

In the shadow of its acquisition by Microsoft, LinkedIn has quietly begun talking about an internal project that has the potential to shake up the roughly $175 billion data-center hardware market.

LinkedIn's plan is somewhat similar to what Facebook is doing with its Open Compute Project. OCP is creating brand-new "open source" data-center hardware, in which the engineers from different companies work together and everyone freely shares the designs.

...

"We are not building servers and switches and all these things because we want to be good at it. We are doing it because we believe it gives us an advantage to control our own destiny," Zaid Ali Kahn, senior director of infrastructure architecture and operations at LinkedIn, told Business Insider.

This is a terrifying trend for vendors like Cisco and Juniper. In the past, only the biggest internet companies like Amazon, Google, and Facebook have gone this route: designing their own IT infrastructure from scratch.


Read more at http://www.businessinsider.com/how-linkedin-is-shrugging-off...

Matt
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I must've missed something. Do tech companies, esp the major ones, no longer obtain/enforce intellectual property rights? I s'pose they may have given up on it, due to tech development moving ten times faster than legal protection of it can be established. That does put a whole new light on investing in tech companies.

ATGTurner
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ATGTurner,

Do tech companies, esp the major ones, no longer obtain/enforce intellectual property rights? I s'pose they may have given up on it, due to tech development moving ten times faster than legal protection of it can be established.

The real issues here are (1) what a patent actually protects and (2) how new it is.

>> 1. Here in the States, patents usually are valid for seventeen years. If the patent is older than that, the right to exclusive use has expired.

>> 2. Many technologies are developed under government contracts that give the government a royalty-free world-wide license to use any invention developed thereunder.

>> 3. Many patent claims pertain to specifics of an implementation, rather than core technology, and thus are very easy to work around.

>> 4. Basic physics and mathematical algorithms are not patentable. Network communication protocols are in fact mathematical algorithms.

>> 5. Standards organizations typically require a release of patent claims in order to include a patented technology in a standard.

In the case of computer networking, the basic networking technologies (Ethernet) and protocols (Transmission Control Protocol (TCP), Internet Protocol (IP), Symmetric Mail Transfer Protocol (SMTP), etc.) of the Internet were developed in the 1970's and 1980's as part of the former ARPAnet, so any applicable patents expired long ago. There's little left to patent that's really going to stop somebody from competing in this market.

Norm.
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Norm,

Many thanks for the explanation. My familiarity with patents is entirely with those protecting mechanical designs of physical hardware, and application thereof to perform physical functions. The standards aspect is new to my understanding as well.

Thanks,
ATGTurner (who enjoys learning)
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ATGTurner,

Many thanks for the explanation.

You're welcome!

My familiarity with patents is entirely with those protecting mechanical designs of physical hardware, and application thereof to perform physical functions.

In many cases, physical hardware is protected by what's known as a "design patent" -- which is a whole different beast. The design patent bars an exact copy of the design, but not a similar design.

The standards aspect is new to my understanding as well.

Standards bodies usually come into play when equipment from two or more manufacturers must work together. A standards body may be a governmental agency, but more often it is simply a professional organization or a trade association. The Institute for Electrical and Electronics Engineers (IEEE), for example, has functioned in this capacity for computer interfaces and network protocols. The standards body often also tests equipment for conformance to the standard and issues some sort of certification of compliance.

Norm.
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