The patent system is specifically designed to protect the idea. But there are certain restrictions on patents which reduce their power.
1) the pantent application has to describe precisely how the idea works.
2) the claims have to be exact.
3) there is a time limit.
4) In every country except the US, patent rights are based on application date, and so unpublished ideas are not protected. (e.g. if your company develops a new concept for recording and playback of music, and then keeps the workings secret, someone else can quite legally reverse-engineer it - note that I am talking systems here, and not content - and you cannot go back an say 'we invented that 10 years ago and now want a patent on it). the US is slightly different, due to historical reasons of the time it took a mid-western farmer to get his design of a new peice of machinery back to the neares patent office, often a 3 month trek away. There if you have evidence as to the date of invention, the patent is retroactive to that date. Of course the time limit for the patent is also taken back by that much. combine this with the fact that there is a cost to keep a patent after 3 years, and after this time it needs seperate patents in each country, and a small inventor who makes no money out of the patent cannot keep the patent for any longer. Of course, the same applies to large corporations as well, but they sometimes keep non-profitable patents going for the full 21 years, just to block the competition.
As for the people with the idea, some companies here in the UK don't even make a working prototype, they just make a simulation, after which they patent the idea and sell that to the big electronic companies.
The biggest problem with the patent system is that the US has no patent examiners which means that peaple can patent anything they like, even if someone else is already using it, and then the only way to overturn these patents is through litigation.