15:02 PM

Silicon Valley should fight laws controlling innovation, says veteran valley entrepeneur

By Tom Foremski for SiliconValleyWatcher

StraightJacket.jpgSilicon Valley could face additional laws limiting technology innovation unless it gets active in politics and lobbies hard to protect its digital freedoms. That was the view of Joe Kraus, a Silicon Valley veteran and an avid angel investor.

Lunch with Joe is always a treat, not just because he picks up the tab but because I get to pick his brains about all sorts of issues and trends. As a veteran of the first search engine wars, when he co-founded Excite, and now heading a corporate wiki company JotSpot, Joe sees a lot more than many, and he has a lot invested in Silicon Valley innovation through his angel investments.

One of the things on Joe's mind is how cleverly Hollywood managed to control innovation. What do you mean by "control," I asked?

"Hollywood is very good at the political process and it managed to get the digital millennium copyright act passed." This essentially gives Hollywood control over innovation, because it gets to approve appropriate technologies and therefor development.

Silicon Valley companies have traditionally paid scant attention to Washington, and have not learned how to play the lobbying games. While older tech companies like Texas Instruments, Intel, and a few others have large staffs in Washington.D.C, they are still less than equal to a force to be felt.

Joe recently joined the Electronic Frontier Foundation, an organization that works to protect digital civil liberties. And he founded the 50,000 member strong lobbying group DigitalConsumer.org.

Last month I met with 463 Communications, a PR firm that is helping tech companies become involved in the public political process. It's a small move in the right direction.

What else is Joe wondering about? "There seems to be a giant sucking sound from Google as it pulls in top engineering talent and technologies," he said.

Earlier this year I saw Eric Schmidt on Charlie Rose and he said graduates are told that if they want to change the world they should choose Google because it has the largest scale and is best placed to achieve their goals. "That's a killer pitch," he said. I know, what can you say to that?

I've been wondering if Google and Yahoo will buy up all the cool emerging companies. And isn't this bad for innovation because there are a small number of bidders for young companies?

They essentially control valuations of startups and that means a lower return for investors.

The same is true in enterprise software markets BTW. Lower returns, equals less investment in future ventures.

We chatted about so many things that we forgot to chat about JotSpot, Joe's current tech focus. Fortunately, the always excellent Dan Farber, at ZDNet met with Joe that day too, and wrote about what is new about JotSpot:

JotSpot reorients itself by ZDNet's Dan Farber -- Joe Kraus of Jotspot came by my office today and we chatted for about 30 minutes about how his wiki-based platform and applications are evolving. Joe has ample Web 1.0 experience in building a Web-centric products and company. He was one the co-founders of the pre-Google search engine Excite (which then became part of the highly touted but now extinct [...]

Here is our interview with Joe from earlier this year.

Joe's blog is here: http://bnoopy.typepad.com/bnoopy/