
Kickstarter, Trademarks and Lies - lucatironi
http://arduino.cc/blog/2012/11/26/kickstarter-trademarks-and-lies
======
deelowe
I love kickstarter, I really do. There's a lot of issues with the way capital
is currently generated that puts the small guy at a disadvantage.

However, I really think the kickstarter team needs to take a closer look at
how things are going today. This is but one example. Out of the many
kickstarters I've contributed to, only one has shipped and only one more
appears to have had any progress in the past 6 months. My friends have had
very similar experiences and all of us have said we probably won't be
contributing as much for a while. It kind of ruins the idea if a very large
percentage of the projects fail or are halted (e.g. trademark disputes).

~~~
qznc
If you consider Kickstarter projects as startups, then a 10% success rate is
ok. Is something like am 80% success rate for kickstarter projects desirable?
They probably would have to implement much higher barriers for applicants
then.

~~~
potatolicious
But Kickstarters aren't startups. This is specifically an avenue for lower-
capital, lower-risk businesses to get the money they need to deliver products.

If you're an angel or VC, the low success rate is countered by the large
upside - a Kickstarter _has_ no upside besides the cool t-shirt/game/gadget
you were promised. The risk needs to be commensurate with that.

~~~
jiggy2011
So basically, a lemon market. When I see for example a kickstarter game that
has a $20 price tag for a pre-order "donation" that seems like reasonable
value.

If however the delivery rate is only 1/10 then that game actually costs me
$200 (since I probably need to fund 10 games in order to get one I can play).

Therefor if I only want to pay $20 for a game, I shouldn't pay more than $2
for a pre-order.

The result of this is that genuine projects who stand a good chance of
delivering have to grossly undercharge for pre-orders which starves them of
the level of funding that they actually need.

~~~
lambda
When funding something, you should consider its likelihood of succeeding and
its value to you.

If its value is around the price you're funding it at or slightly higher, then
you should only fund things which have a high chance of success; from a proven
team, that has shipped plenty of products before. For instance, a band that
you like that's released several albums and is raising money for a new one, a
studio that is developing a new game based on an existing engine, and so on.

If it's a riskier campaign, like development of a new hardware product from a
new company that has never shipped anything before, or an artist's first
album, or some amazing new game with an amazing new engine that has all kinds
of really neat features, with a game designer you like but a rookie team, then
you should only fund it if it has significantly more value to you than what
you are funding. Maybe you just think it's such a good idea, that even trying
and failing and learning from that is worth the money you spend. Or maybe you
think that it is a game worth $200; it's such a perfect game for you, that you
would be willing to shell out $200 for it, or the equivalent, fund 10 such
games for $20 and get one working game out of it. Or maybe you're just a big
fan of the person you are funding, and don't mind giving them $20 even if you
think they might not complete the project.

So yes, you should be aware of the risks when funding something; that's why
it's funding, and not buying a completed product. You should decide if what
you're going to get is worth the risk. Far too many people seem to see
Kickstarter as a pre-order system, where the product is basically ready but
they want funding to determine how large to make the first batch and fund just
the final manufacture. Maybe people think that because it does act that way
for some products; but you really should not expect it to work that way for
all products.

If Kickstarter limited themselves to the pre-order model, that would vastly
limit the kinds of things it would be good for. You seem to want only pre-
orders, not to fund development, so maybe that would work for you. But some
people want to be able to fund riskier, more wild ideas, and accept that risk.
I think that they should be able to; the only trick is that there seems to be
a good deal of confusion on the part of funders as to which projects are which
type; people don't seem to be very good at judging the risks involved when
funding a project.

~~~
jiggy2011
The reason I use the lemon market analogy is that it is not always clear to
the buyer what the level of risk is. Sure there are certain signals which
indicate lower risk but I don't think there is yet enough data on completed
projects to confirm this absolutely.

Some buyers are also savvier than others, for example is it riskier to fund an
indie platformer or an arduino replacement? A HN reader might be able to guess
but the general consumer might well have no idea.

There are also other factors, like might this fail because there isn't enough
funding? or might this fail because it is just an outright scam?

So basically what we have is information asymmetry which will lead a lot of
people to assume some mean level of risk in funding a project so the required
value payoff will be higher than something bought off the shelf, what the
"value coffecient" will be will take time to discover though.

The point is valid though that for example a game which I would love but would
never be funded by a game studio might be worth $200 for me.

~~~
lambda
"...buyers..."

"...consumer..."

This is the problem. If people are thinking of themselves as consumers, rather
than investors, then yes, you have a problem. This is why Kickstarter changed
their rules on physical products, to not allow people to buy multiple
quantities of something, in order to discourage people from treating it like a
pre-order system.

Yeah, there's a certain amount of information asymmetry. I'm not sure you can
ever do away with that, without killing the idea of crowdfunding entirely. If
you require legal filings and financial disclosures and the like, all of a
sudden you can't do it for small projects, you need to hire lawyers and
accountants and things like that.

The best way to solve this is to convince people only to crowdfund people that
they really trust. Don't look at an idea and say "hey, that's cool, I'll buy
one of those." Look at the creator and say "this person can deliver, I'll give
them some money to do so."

------
mbanzi
I'm the author of the blog post. The objective of the post is to ask
Kickstarter to provide a more direct way to report either trademark violations
or lies (like this guy claiming to be a former manufacturer of Arduino) that
might affect the people who fund a project.

~~~
kfury
If the point of the blog post was to get Kickstarter to change their policy
then it was very poorly written. It read like a hit piece on Smartduino.

I'm a backer of the project and have been following it closely. You don't seem
to want to get to the bottom of this so much as yell from a soapbox. Calling a
guy and asking 'have you ever heard of this guy?' isn't really enough research
for the accusation you made.

When you found out that he _does_ have people on his team who were on the
Arduino manufacturing team you still call him a liar. When he claims to have
order invoices from your company and asks for your permission to make them
public, he hears nothing.

There's a bit more nuance here than you presented, so how about you two get in
to a substantive discussion before you hurl any more volleys over the wall at
a guy who, though you disagree with, is making a quality product advancing
your platform, and who has been trying to talk to you about this?

~~~
headbiznatch
Having just read the post and most of the comments, this seems to about sum it
up. The post barely sneaks in an ask for community opinion on Kickstarter's
communication policy while focusing on casting aspersions on the project's
validity (including some amazingly shameless "asides" about the founder's
reputation). Now the lawyers have come out and it's just getting further and
further from useful discussion, if that was truly the original point.

It must be said - bitch all you want about the claim that these guys
manufactured Arduino, but on nuance, it appears supportable. When team members
who built something (or worked on it to a significant extent) move on, the
work they did previously is in their portfolio whether you like it or not.
This practice is standard in other industries, too, especially marketing. And
of course, the obvious: if, as is claimed in the post, Arduino is afraid of
damage to the brand, why not complain about all the other BLAHduinos out
there?

This makes Arduino look bad, and if the founders of the contentious project
are actually shady, they are loving the cred this reaction will earn them.

------
jmole
Crossposting my comment from the blog post here, because the Arduino servers
are apparently under heavy load, and most people will TLDR the post and just
look at the comments here.

======

Hi All,

I recently launched a Kickstarter project as well, that ended about a month
and a half ago: [http://www.kickstarter.com/projects/18182218/freesoc-and-
fre...](http://www.kickstarter.com/projects/18182218/freesoc-and-freesoc-mini)

Dimitri, the creator of the smARtDUINO project got in touch with me a few
weeks ago to collaborate on creating a smARtBUS adaptor for our platform.

We’ve exchanged over 40 emails since then, and my impression is that he’s an
earnest, upstanding man, who really cares a lot about the electronics
community and making it easier and less expensive for people to do creative
things.

We had a discussion about Kickstarter in particular, and one of the things he
mentioned to me in our conversation was that he felt his campaign placed too
much emphasis on the “Arduinoness” of the project, and not enough emphasis on
the true innovation, which is the smARtBUS interconnect system.

We discussed the perils of successfully marketing a Kickstarter project, and
said in retrospect, “If we communicate better the project, I have no idea were
we can be now that it should be clear this is not just another Arduino.” (this
was about a week ago, near the end of his campaign.)

I think if you can honestly blame him for anything, it’s not effectively
conveying the message of the product in an concise way. If his workers were
indeed manufacturing Arduino in Italy, there’s nothing wrong with claiming it.
I’ll admit that the claim might look deceptively grand at first glance, but my
intuition tells me this has more to do with Dimitri’s English ability, rather
than a malevolent attempt at hijacking the Arduino brand.

~~~
asmithmd1
The issue is the owner of the trademark "arduino" wants the wording changed on
the project to avoid confusion. If this is a simple misunderstanding why is
the project owner being unresponsive? I am sure the project owner's contact
info is up to date with Kickstarter since he is expecting a +$150k wire
transfer from them.

~~~
jmole
He's been very responsive. Look at the blog post comments.

Also, to clear up a misconception, Kickstarter doesn't pay the project
creators, Amazon does. It pays the creator individually for each backer, and
then money is transferred to Kickstarter from the Creator's payment account.

So the individual backers pay the Creator, the Creator pays Kickstarter. But
it all happens automatically.

------
yock
Woah, wait a minute? Someone contacts Kickstarter and alleges that a paying
customer of theirs is using the Kickstarter platform to violate the law and
Kickstarter's only response is to contact the customer directly? This has to
be some kind of joke, right?

~~~
lsc
In the ISP space, that's pretty common. In fact, with things like the DMCA,
that's codified into law.

Really, you don't want some private company acting like a judge here. We don't
have the legal knowledge or interest.

Your choice here, essentially is "Shut down everyone who gets a complaint" or
"try to be the judge" (e.g. only shut them down if the complaint isn't
obviously bogus) or 'forward the complaint on and let them deal with it'

There are a lot of reasons why you, the customer, would want #3.

~~~
crusso
_In the ISP space, that's pretty common._

ISPs are data conduits and we don't expect them to police everything.

 _In fact, with things like the DMCA, that's codified into law._

Content processors like YouTube have already been shown to have an obligation
to support take-down requests from IP holders.

In this case, Kickstarter got the equivalent of a polite take-down request
from Arduino and they said, "nah".

While I see the common carrier strategy they're pursuing, I don't think that
it makes sense in the long run. It will crumble like a house of cards when the
first team of lawyers takes a whack at it for serious infringement.

Worse yet, by that time Kickstarter's reputation for protecting the interests
of backers will likely be irrevocably damaged, thus destroying their business
model anyway.

Throw in some competitors to their business model who add in some sense of
protecting the interests of backers and Kickstarter will end up being the
Myspace of crowd funding sites.

~~~
jasonlotito
> Content processors like YouTube have already been shown to have an
> obligation to support take-down requests from IP holders.

An obligation in-so-far as the DMCA is enforced. YouTube might be doing
additional things as a company, but they aren't required by any law I know of.
Maybe it's an agreement with IP holders, but it's not a law.

> Kickstarter got the equivalent of a polite take-down request from Arduino
> and they said,

That isn't the same thing as a DMCA take-down request.

> It will crumble like a house of cards when the first team of lawyers takes a
> whack at it for serious infringement.

The DMCA protects them. Their is no indication they received a DMCA request.

------
sschueller
Well I fell for it. I thought the smARtDUINO was from the official team.

~~~
makomk
Did you read the FAQ?

------
dimitrialbino
There is much that anyone can say about Kickstarter.

The problem is that all this discussion started from much different topic.

Here we are talking about someone, Massimo Banzi from Team Arduino, that wrote
on the public blog of Arduino, which have for sure hundreds of thousands
followers, if not more, that a company doesn't exist and that another person,
stated with first and last name, was claiming something that he didn't.

Reading the Kickstarter page, including the bio, the faqs, the comments and
the huge quantity of updates, can see very easily that this person always made
very clear he's living in China so, why publish something so unfaithful?

When then it came out that the problem was on the table since October 29th,
few hours after the launch of the Kickstarter project, why wait almost one
month to complain.

The registration certificate went public so, the company exists and this is
proven. Nobody heard about any apologize for the false statements.

The only think Massimo Banzi tried to do, here as well, was to try to change
the topic.

The question is: is it right that the owner of a so popular blog write false
statements, but when become clear to everybody that he was wrong, he try to
change topic, instead issue the owed apologize?

This remember me when Steve Jobs (R.I.P.) is supposed he stated: "there is
nothing wrong with iPhone 4, they are holding it not properly".

Massimo Banzi is for sure member of a group of very clever peoples that
created such a good thing like Arduino, but he doesn't have the right to
attribute to others the false and pretend that nothing happen here.

------
kfury
(my comment on the Arduino blog, cross-posted here)

Massimo, you asked the Arduino community for comments, so here’s mine.

It’s obvious that Dimitri isn’t trying to do you or Arduino harm. Did he over-
represent his team’s association with Arduino? Perhaps, though not to the
degree that you claim, and your repeated accusations that he’s a liar go over
the top.

While you’ve made it very clear you don’t like the term ‘Smartduino’ this is a
slope that Arduino has navigated before, trying to find the happy medium
between building an open platform and community of developers and
manufacturers and protecting your own intellectual property.

Regardless of where Smartduino falls on that line it clearly doesn’t fall very
far away from it. So again, whether Dimitri is right or wrong he certainly
doesn’t deserve the lambasting bordering on libel that you’re dishing on him.

For someone who has such a leadership role in the Arduino community, your
actions today have done a very poor job of promoting it. At the heart of the
Arduino movement is the idea that hardware development doesn’t have to be
about huge companies that build walls around their IP with lawyers manning the
battlements.

This is how THEY solve their conflicts. This is not how WE solve our
conflicts.

Got issues with how the Smartduino project represents itself? Talk to them.
Work with them. Don’t try to whip us into a frenzy of torches and pitchforks
because every single person in this community is trying to expand it and move
it forward, a sentiment I see throughout these comments, but not in your own
words, where I would most expect to see them.

------
belgianguy
While this "smARtDUINO" (lame!) copycat behaviour is indeed appalling, the
alternative can be a real hassle, too. Trademarks and copyrights deserve
protection, but as YouTube has shown, DCMA abuse can halt projects just as
well.

Perhaps they could implement a 'Flag' system, that allows IP owners to signal
illegal use/infringement, after which a review (in which both the complainer
and the starter should be involved) can decide whether or not the project can
proceed. This could easily sail into DCMA hell or lawyer heaven if a big
corporation feels threatened, which could file complaint after complaint just
to stall the competition.

But where do you draw the line?

~~~
tobydownton
Why is it lame/appalling? I've read the comments on the blog post and
apparently the "duino" name isn't trademarked, and therefore they are quite
within their right to use a variation of it (however lame it may appear).

Further commentary reveals that the people who have backed this guy are happy
that he is the real deal, and that the problem has mostly stemmed from English
being his second language, leading to a mis-communication over quite what part
they had in manufacturing arduinos in Italy.

~~~
saddino
No. A goods/services provider has "common" trademark protection in the US even
if without a registered mark, so this usage is not "within their right."

[http://tcattorney.typepad.com/ip/2008/06/what-are-
common.htm...](http://tcattorney.typepad.com/ip/2008/06/what-are-common.html)

~~~
kfury
Relevant, from Arduino's FAQ: "Note that while we don't attempt to restrict
uses of the "duino" suffix, its use causes the Italians on the team to cringe
(apparently it sounds terrible); you might want to avoid it."

<http://arduino.cc/en/Main/FAQ>

------
scottymac
While I understand the desire for Kickstarter to police this kind of thing,
the burden ultimately sits with the owner of the trademark being infringed
upon to pursue legal action or risk losing the trademark. Frankly I'm a little
surprised at the response here on HN given that Kickstarter is an early stage
company with limited resources. Why should they focus on something where there
are already laws in place and avenues to pursue infringement? Who's to say
they should be the arbiter on what constitutes infringement?

------
shardling
It would be nice if anyone speculating on Kickstarter's legal obligations laid
out their own credentials.

Because _just maybe_ Kickstarter has already considered the legal, logistic
and ethical aspects of their own business, and _possibly_ even consulted with
lawyers and other experts.

~~~
DannyBee
As a corporate IP lawyer, I can say I have to agree. Kickstarter was probably
told (rightly so, in fact) to stay out of the legal disputes, and tell
projects/trademark owners to sort it out amongst themselves. IE follow valid
court orders that tell them to do things, but otherwise, don't participate in
these types of dispute.

This will likely get them sued eventually for not doing anything, but this
probably won't happen until later in life (if Google, Yahoo, Facebook, etc,
are any benchmark). So far Google's had a good record, at least in the US, of
not having liability, trademark wise.

On the other hand, if they actually start to take down projects or otherwise
deal with trademark disputes, they bring all sorts of possible liability onto
themselves. Plus the hassle of trying to verify trademark claims, and
effectively being asked to judge whether the usage of a given trademark is
infringement. All bad ideas to be involved in. There is literally no upside
for them.

Worse, despite nice TOSen that disclaim liability for everything under the
sun, you can't always remove all liability. It's like grocery store parking
lots that have large signs saying "not responsible for lost or stolen
possessions left in cars". This is done because in a lot of places, they are
actually legally responsible, and they are just trying to get people to stop
suing them all the time.

The trust and responsibility aspects are certainly a significant concern, but
this has little to do with whether they should get involved in the business of
disputes between projects and trademark owners. Heck, if you wanted to
encourage "authorized" projects, you could even have some nice logo display
program where verified sponsorship means you get to display some logo, and it
only shows up on those kinds of projects. Or you establish some sort of
"trustrank" scoring or whatever where relationship with trademark holder or IP
holder is a scoring factor.

Whatever the solution, there are plenty of ways to incentivize good behavior
and happier trademark holders without making yourself an arbitrator.

------
robomartin
Reading through some of the comments is interesting in that my experience with
Kickstarter seems to have been --so far-- nearly polar opposites to that of
others.

I have almost exclusively backed technology projects. Out of those, not one of
them has failed to deliver. And, not one of them has delivered on time. Out of
all the projects I have supported only one has ended-up in the trash can.
However, that was not because the widget was not executed well or it was junk.
It was simply a case of my idea of the utility of this gizmo failing to align
with reality once I got it. No issues on my part. I've done that plenty other
times even buying stuff from brick-and-mortar stores.

If I allow myself to presume about the reasons for my "success" I'll have to
say that the only thing I can reasonably point to is that I have a lot of
experience actually designing. manufacturing and, yes, shipping technology
products. I am intimately familiar with the design, sourcing and manufacturing
process (and issues) of most products that entail software, electronics and
mechanical components using various technologies.

This, to me, means that I have a fairly decent "bullshit" filter when it
applies to these kinds of projects. Not to pick on them, but my most recent
"this is bullshit" call was the LIFX light bulb:

[http://www.kickstarter.com/projects/limemouse/lifx-the-
light...](http://www.kickstarter.com/projects/limemouse/lifx-the-light-bulb-
reinvented)

Why did I call this BS?

You have to rewind to when the project first posted. Their pledge goal was set
to $100K. A project like that could easily burn-up half a million dollars just
in engineering, NRE's and regulatory testing. Very easily. In fact, my
immediate thought after reviewing the project was that the project needed
somewhere in the order of two million dollars.

When I see something like that I have to ask: Are the project originators
truly clueless about what it might take to get the project done? I don't like
to think that fraud is involved. I am one of those saps who believe that the
vast majority of people are basically good. So, no fraud. Yet, $100K?

What would have happened with LIFX had they received funding just about their
requested $100K goal? Say, $150K. Well, in my world that would have meant that
there was no way to complete the project. No way. At least not with anything
that I'd want to plug into a lightbulb socket at my house for a myriad of
safety reasons.

I avoid such projects.

As it turns out, they have raised about $1.3 million. This may or may not be
enough to get this done. Keep in mind that bringing in partners isn't free.
COGS must include all costs.

With regards to the ARDUINO issue. I saw that project come up and immediately
went to the known Arduino sites. I saw nothing promoting the project or making
this connection of having an ex-Arduino manufacturer behind the Kickstarter
project. So, I stayed clear.

I see the relationship between Kickstarter and their vendors very much like
that of a shopping mall owner and the stores it might house. Imagine that one
of the stores decides to sell counterfeit Gucci bags or defraud people in some
other way. I can't see the mall owner as being guilty of the crime being
committed. If a direct nexus is established, well, then, that's a different
story.

I also see the buyer as having to be responsible for the decision they make.
If someone sells you a perpetual motion machine and you were not smart or
informed enough to realize that this can't possibly work, well, in many ways,
it's your fault. Be an informed buyer. That's the only way to protect
yourself.

EDIT: I should say that I like Kickstarter very much. I don't have a problem
with the service. If you know what you are doing both as either a project
originator or a project backer, it's wonderful.

~~~
ChuckMcM
I too called BS on the LiFX bulbs. In part because Phillips had recently won a
prize for one of their LED bulbs and it cost them $25M+ to develop. So even
accounting for 'knocking down the hard problems' I couldn't see a 10x
reduction in cost.

However the cool thing about it was that they saw an actual demand for
programmable LED bulbs with RGB capability and came out with 'Hue.'[1] I
suspect they took the Apple Store only route because it was a single partner
who could conceivably move enough product to technical saavy people. It seems
to have worked as they are sold out in the Bay Area, not sure how many kits or
bulbs that was in the initial batch but probably a few. They also sell the
bulbs for $60 each, which is another interesting number. If you take all of
the money raised for LiFX and divide by the number of bulbs they are committed
to shipping out as rewards it comes to $55/bulb.

[1] Full Disclosure: I bought a starter set of "Hue" lights when they were
announced and did _not_ back the kickstarter campaign for LiFX.

~~~
robomartin
A 10x reduction in development cost is reasonable for a small company. Large
corporations have to float a huge boat just to stay motionless. Another way to
say it is that they burn millions of dollars per day just to exist and do
nothing else. When you see cost-of-development numbers for large companies
they include an element of total-cost-to-just-exist/days-per-project/number-
of-current-projects (oversimplification).

A small motivated team without the baggage and overhead can certainly do thing
far, far cheaper than a large corporation. In fact, it can put a large
corporation to shame in terms of productivity and the ability to pivot and
innovate.

Where things get difficult for a startup is when it is time to move to
manufacturing. Unlike software projects, making physical products is really
capital intensive. The first phase is, of course, the upfront design and DFM
work that has to be done. Then comes all of the prototyping and testing.
Finally, setup for manufacturing, procurement, manufacturing, packaging and
shipping. If a startup isn't well funded it might be able to get through the
design phase but not survive to reach manufacturing without an additional
influx of funds.

