In a galaxy not so far away (actually very close) there was a war developing, as ideas were considered sacred and protected by the greatest force that there was - lawyers! As ideas grew into products, they could seek a form of intellectual property protection called ‘patents’. These patents granted the inventor of an idea a legal way of receiving a form of compensation without ever producing such product. On the other hand, the producers of products also sought a way to avoid such deemed ‘unnecessary payments’ to inventors through the greatest force that there is. And so began the Patent Wars.
The rest of the story is pretty easy to make out. The inventors win some, the manufacturers win some and the lawyers always win. Why has this ongoing game suddenly become such an issue? Because the behavior of the parties has changed.
In the past we had many important patent infringement law suits, but we never heard of them, because they were typically settled outside of a court of law. Business sense trumped legal proceedings for a long time. Now something has changed and legal protection is rated above brand and product strength.
There are several developments in the past few decades that favored such thinking. First of all most components are manufactured today by only few large companies. Whoever comes out with a new idea first will have copies of this idea appearing almost immediately. Since creating ideas cost money (inventors also like to drive nice cars and live in nice houses), it will be difficult to recuperate any money spent on creating new products if the price pressure starts almost immediately. It seems that today the copycat is in a better position to make money, as they avoid any investment in development all together. This general idea was formulated with great success by GE several decades ago under the doctrine of the "fastest second" in the market.
Not so fast though, when we look at today’s company success measured in profitability, there is Apple and then there is the rest. While Apple is definitely investing in new technology, there real strength is in combining their own ideas with the ideas of others to create something new altogether. This other idea is where the gray zone starts. Sometimes they buy companies; sometimes they end in court getting sued for patent infringement. On the other hand they sue everyone else around the globe to protect their final product. There is no much difference between them and any other company other than they seem to have more lawyers on hand than anyone else.
Then there are the patent trolls. These companies buy patents from independent inventors or companies to exploit the use of such patents through law suits. The difference here is that large companies typically stall smaller companies or private inventors from receiving licensing fees through law suits. Patent trolls make money from licensing fees, so it is in their best interest to go after every patent infringement with full force. If these patent holders received a reasonable licensing fee in the first place, why would they sell their intellectual property to someone else like a patent troll? It could be argued that the existence of patent trolls is a direct consequence of the practice of avoiding paying licensing fees to smaller inventors. Getting rid of patent trolls would shift the balance of power more in favor of big companies with a large lawyer staff.
Where is this all leading us? The current procedures on a worldwide basis are not able to deal with the situation. There are really two ways we can go; get rid of patents or make patent enforcement easy and globally supported. Both ideas have been used in the past and by themselves will not find enough political support to be enforceable on a global basis. This leaves us with minor tweaks to the system and a hope for the return of business sense over the power of law. Generally though, we have to move in one of these directions to overcome the current situation. Which direction should this take? Many of you are inventors or work close to inventions in the display industry, so let me know what you think.
Here is a new idea; make law suits in courts more expensive. How about increasing court fees to the level of typical licensing fees, there would be no business sense in suing someone and many law suits could be avoided (hopefully). This model would make the public the winner in every patent law suit as the licensing fees would be paid to the countries directly (one side will always loose) and help to lower the national debt around the globe. A program to jumpstart the world economy! Don’t forget you read it here first.