When a company called Allied Security Trust came out of his hiding place in late June, they caused a new light on the growing popularity of patent pools with high-tech titans are cast. It is to be less than clear whether these pools are benign defensive organizations or curb the trade-innovation-killer.
Allied Security Trust is just the latest consortium of major technology company formed to acquire and pool key patents. The idea of a patent pool is simple:Companies do not coordinate their efforts of intellectual property through the purchase of important patents, and granting of all members of the consortium-exclusive licensing rights to them. First used in the 1800s, patent pools to minimize risks and costs for participating firms by avoiding costly litigation.
In recent years, the technology companies are increasingly dealing with patent pools just that. In addition to the Allies, whose members include Verizon, Google, Cisco and others, there are a number of otherTechnology patent pools, each with a slightly different strategy and roster of players. Open Innovation Network, a pro-Linux group include Novell, IBM and others as members, was organized in 2005. Intellectual Ventures is to be supported by Microsoft and Intel, was the acquisition of patent portfolios since 2003.
Fight against trolls
Companies involved in these organizations say they are purely defensive, fighting to buy from other companies whose sole activity is to intellectual property and hold it hostage. This so-called trolls are both feared and loathed because litigation can be expensive, time consuming and distracting. Significantly cheaper than PLECS, patents, patent licensing and enforcement companies, these trolls patrol looking for the intellectual property landscape overlook the far-reaching application of the technology world. Once they intellectual property, which they consider themselves to be violated, they contact the users of the patented> Technology and demand payment. In a friendly transaction, the PLEC licenses the technology to other companies. Takes place in an adversarial situation, litigation.
The most lucrative situations for the PLECS are those in which the infringing company has deep pockets and there are many companies hurt. It is precisely these situations that patent pools are designed to prevent weapons. By avoiding essentially of investigating or outside the pipe, the trolls, patent pools, litigation and / or licensingCosts.
The critics of modern technology patent pools say they are anticompetitive. With the purchase of intellectual property, these groups are only one degree away from the trolls, say opponents. Charged in the case of the Allies, to become a member a company must be a reported $ 250,000 to join and buy put up another $ 5 million in escrow to patents. The members then grant themselves non-exclusive license rights.
At Allied, CEO Brian HinmanClaims it will then sell the patents back on the market. "It is a catch-and-release formula to an opt-in managed basis, he told EE Times in June 2008.
Critics argue that this allows the trolls simply join the hunt for smaller companies who do not ante up the funds to the exclusive patent pools. The result, they say, is that the tech giant to strengthen its dominant position in the market.
Other patent pools, but are not obviously about building intellectual propertyFortresses, where only the elite reside. Open Innovation Network makes its patents available without charge to anyone who agrees not to sue members. Currently, these types of pools seem to be more benign, instead of restricting the promotion of innovation.
Compassionate oligopolies or entities?
Some observers fear that lead to proliferation of these patent pools in oligopolies. The trade of the main intellectual property rights among these groups is seen by some as akin Nationsthis to their own advantage. It is quite possible that different groups could work together on the strategy or even participate in formal or informal contracts.
Actions like these could easily be understood as anti-competitive. Currently, the players in patent pools are limiting their moves to defensive measures. But his intellectual property, what is the most important tech companies to participate in these organizations can not remain gracious.