Eco-patent commons – what's going on?
Allan Main, who is an intellectual property capture and commercialisation specialist and regular commentor to this blog recently wrote in about the recent establishment of an Eco-patent commons as follows:
"It is rare that a new development in IP strategy has me scratching my head as much as did the recent announcement (see for example http://www.greenbiz.com/news/reviews_third.cfm?NewsID=36540) of the Eco-patent Commons administered by the World Business Council for Sustainable Development. I generally pride myself on having a fairly strong strategic head on my shoulders, but this one has me beat as to the benefit to members, except (maybe) that it might provide a clumsy “green” PR benefit for the patent donors.
The system was explained by an IBM Exec thus:
“Balta explained that businesses may hold patents that do not serve as an essential source of income to them, and that by sharing them with others on a global basis, these patents can help people develop in a more sustainable way.
Additionally, for those companies pledging their patents, this information-sharing might have additional business benefits”
Separately, I have read that it is intended that the patents will be made available to anybody at no charge. That’s the bit I don’t get. Why would a patent owner contribute a patent, continue to sustain the maintenance costs, yet have the patent commonly available to all having undertaken to not enforce the patent? Why not just allow the patent to lapse (telling the world that you’re doing that to free-up availability of the technology for the greater good to bank the PR benefit). The only way I can see this having a benefit for the patent contributor is if the commons operates as a closed club for cross-licensing the patent pool to members, but only members. But everything I read leads me to believe this is not the intention.
What have I missed? Maybe a tax-benefit to the donor? But I would have thought that as soon as the patent is donated to the public, its value is annihilated, and so a zero-value asset is donated!??!"
Here are some of my thoughts on this:
- IBM are donating 27 patents to the Eco-patent Commons – this is a tiny fraction of their overall portfolio;
- IBM have repeatedly stated (and I’m sure the other participants agree) that they will only donate patens which don’t ‘represent material top line or bottom line financial aspects for your business’
- There are certainly tax benefits which can be gained from donating IP – though the various tax authorities have been much more strigent in recent years on the valuation accorded to the IP.
- I think the PR angle is a very important part of this.
- I think the companies genuinely do want to stimulate creativity and innovation and are willing to sacrifice less important patents to this end.
- The current participants are sufficiently big and specialised, that they are probably assuming that by having open access to new ideas and IP, they can get a reasonable jump on competitors in their inventive activity, simply because of their size.
- Wholesale donation of patents which you’re not really obtaining much commercial benefit from is nice, but it would really signal a sea change if they were to agree to an open innovation model in which no one was able to individually own IP generated from the group’s collaboration. That would, I suspect require that the group become ‘closed’ in some way, but most likely generate much greater creativity.
One Comment on “Eco-patent commons – what's going on?”
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Thanks for the post, Duncan, I’ll watch with interest for the informed insights of your readers.
While I understand the apparent benefits that you surmise as the motivation of the donors, I don’t see anything gained by the act of donating that could not be achieved more cheaply by abandoning the patents and telling the world “we did it for you”. Perhaps the tentative toe-dipping by the participants might well imply that they too haven’t quite sussed how this game should shake out, but the foundation participants are no minnows in IP management, so they must have construed at least a chance of a pay-off beyond a public abandonment “for the good of mankind”.
I only wish I understood their vision!