IP review
autumn
2015
The great
patent
giveaway
Over the past year or so there have been a number
of eye-catching headlines about major companies
apparently deciding to allow others to use their
patented technologies freely, without fear of being
pursued for patent infringement. Such generosity
comes as a welcome antidote to mounting hostility
to the patent system, particularly in the US, where
demands for patent reform have grown louder recently,
but can these offers really be motivated by altruism?
Tesla Motors was the leader of the pack when, in June
2014, it announced that it would open up its patent
portfolio to anyone wishing to use its technology in good
faith. According to its CEO Elon Musk, Tesla’s move was
made in the spirit of the open source movement, with the
aim of accelerating the development of electric vehicle
technology.
Whilst this announcement has been widely applauded, it
does leave some unanswered questions. Tesla does not
appear to have abandoned its patents, so the technology is
not really freely available. Instead, it has simply stated that it
will not instigate lawsuits against anyone who “in good faith”
wants to use its technology. That’s very different from a
wholesale release of the technology into the public domain.
Tesla’s announcement may well accelerate the
development and adoption of electric vehicles, as others
bring their R&D muscle to bear on technological barriers
such as limited vehicle range and a dearth of recharging
stations. If that happens, Tesla itself will be a major
beneficiary. As noted in Tesla’s announcement, electric car
programs at the major automotive manufacturers are small
to non-existent, which gives Tesla a head start in a market
that it expects to grow significantly. When those major
automotive manufacturers do climb on board the electric
bandwagon, perhaps by adopting a common electric
vehicle standard based on Tesla’s technology, Tesla’s
years of experience and proven track record will likely
set its vehicles apart and give it a competitive advantage,
particularly if prices fall and infrastructure such as charging
stations becomes more widespread.
Tesla’s declaration of altruism is also a shrewd publicity
move, particularly at a time when the public perception
of patents, in the US at least, is increasingly negative. By
seemingly declaring itself anti-patent, Tesla has aligned
itself with the public mood in an important market
and scored major PR points, which could translate into
increased sales.
Toyota was next to the free patents party, announcing at
the Consumer Electronics Show in Las Vegas in early 2015
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