Google is Giving Away Certain Patents to 50 Startups In Their Latest Effort to Thwart Patent Trolls

"She Runs Neon Fraction of a Second", Image by Wonderlane

“She Runs Neon Fraction of a Second”, Image by Wonderlane

In the highly competitive world of creating, monetizing, defending and challenging tech-based intellectual property, “free” is neither a word often heard nor an offer frequently made.

However, Google has just begun a new program, for a limited time, to give away a certain types of patents they own to an initial group of 50 startups.  This is principally being done in an effort to resist time and resources devouring litigation with “patent trolls“, companies that purchase patents for no other purpose than to litigate infringement claims in their attempts to win monetary judgments. (We first visited this issue in an April 21, 2015 Subway Fold post entitled New Analytics Process Uses Patent Data to Predict Advancements in Specific Technologies.)

The details of this initiative were carried in a most interesting new article on TechCrunch.com posted on July 23, 2015 entitled Google Offers To Give Away Patents To Startups In Its Push Against Patent Trolls by Ingrid Lunden. I will summarize, annotate, and pose some free questions of my own.

In April 2015, Google successfully started a temporary program for companies to offer to sell them (Google) their patents. Then on July 23, 2015, they launched a reciprocal program to give away, at no cost, “non-organic” patents (that is, those purchased by Google from third parties), to startups.

The recipients of these giveaways are required to abide by two primary conditions:

  • They must join the LOT Network for two years.  This is a tech industry association of patent owners dedicated to reducing the volume of patent troll-driven litigation.
  • The patents can only be used defensively to “protect a company against another patent suit”. Thus, the patents cannot be used to bring a case “against another company” or else its ownership “reverts back to Google”.

Kurt Brasch, one of Google’s senior patent licensing managers who was interviewed for the TechCrunch story, expects other members of the LOT Network to start their own similar programs.

For any of the 50 startups to be eligible for Google’s program, another key requirement is that their 2014 revenues must fall between $500,000 and $20 million. Next, if eligibility is determined, within 30 days they will receive “a list of three to five families of patents”, from which they can make their selection. Still, Google “will retain a broad, nonexclusive license to all divested assets”, as these patents might still be important to the company.

For those startups that apply and are determined to be ineligible, Google will nonetheless provide them with access “to its own database of patents”. These are presumed to alas be categorized as “non-organic”. The unselected startups will be able to ask Google to consider “the potential purchase of any such assets”.

Back in April, when Google began their acquisitions of patents, they were approached by many operating companies and patent brokers. Both types of entities told Mr. Brasch about a “problem in the secondary market“. These businesses were looking for an alternative means to sell their patents to Google and Mr. Brasch was seeking a means to assist interested buyers and sellers.

Google eventually purchased 28% of the patents they were offered that the company felt could potentially be used in their own operations. As these patents were added to Google’s patent portfolio, a portion of them were categorized as “non-organic” and, as such, the company is now seeking to give them away.

Both sides of Google’s latest patent initiative demonstrate two important strategic points as the company is now:

  • Taking more action in enabling other tech firms to provide assistance against litigation brought by troll-driven lawsuits.
  • Presenting the company as a comprehensive “broker and portal” for patents matters.

Last week, as another part of this process, Google substantially upgraded the features on its Google Patents Search. This included the addition of search results from both Google Scholar and Google Prior Art Finder.  (For the full details and insights on the changes to these services see Google’s New, Simplified Patent Search Now Integrates Prior Art And Google Scholar, also by Ingrid Lunden, posted on TechCrunch.com on July 16, 2015.)

While both the purchasing and selling operations of Google’s effort to test new approaches to the dynamics of the patent marketplace appear to be limited, they might become more permanent later on depending on the  results achieved. Mr. Brasch also anticipates continuing development of this patent market going forward either from his company or a larger “group of organizations”.  Just as Google has moved into other commercial sector including, among others, “shopping, travel and media”, so too does he expect the appearance of more new and comparable marketplaces.

My own questions are as follows:

  • In addition to opposing patent troll litigation, what other policy, public relations, technical and economic benefits does Google get from their new testbed of marketplace services?
  • What other industries would benefit from Google’s new marketplace? What about pharmaceuticals and medical devices, materials science (see these four recent Subway Fold posts in this category),  and/or automotive and aerospace?
  • Should Google limit this project only to startups? Would they consider a more expansive multi-tiered approach to include different ranges of yearly revenue? If so, how might the selection of patents to be offered and other eligibility requirements be decided?
  • Might there be some instances where Google and perhaps other companies would consider giving away non-organic patents to the public domain and allowing further implementation and development of them to operate on an open source basis? (These 10 Subway Fold posts have variously touched upon open source projects and methods.)

New Analytics Process Uses Patent Data to Predict Advancements in Specific Technologies

"Crystal Ball", Image by Christian Schnettelker

“Crystal Ball”, Image by Christian Schnettelker

John Oliver did a brilliant and hilarious takedown of patent trolls on his April 19, 2015 edition of his Last Week Tonight show. He raved about the absurdity of such companies who buy up patents and yet produce nothing much themselves other than lawsuits to enforce theses patents. As he said, this is a form of “extortion” that impedes progress and ends up costing the defendants in these actions a great deal of money. If you did not see the show or have not seen the video yet, please have a look and a laugh.

Then compare and contrast that economic fear and needless cost of using patent data in such a negative manner with the publication of a paper last week about how US patent filings are now being used in an entirely opposite, innovative and productive manner. The contrast could not be more dramatic. Indeed, as presented in a new paper published online on April 15, 2015 on PLoS One entitled Quantitative Determination of Technological Improvement from Patent Data, by MIT researchers Christopher L. Benson and Christopher L. Magee, mining recent filings in the US Patent and Trademark Office’s (USPTO) massive database using their new methodology, can determine which technologies are genuinely advancing and at what relative rate.

This very exciting news was reported and analyzed in an article posted on Phys.org on April 15, 2015 entitled New Method Uses Patent Data to Estimate a Technology’s Future Rate of Improvement. I will sum up, annotate and add a few questions to this. I highly recommend clicking through on both this article for the details of how this prediction tool was developed and the full-text of the PLoS One paper for the granular details of how it actually works.

(For cross-reference purposes, this advancement follows on and partially mixes together the topics of two previous Subway Fold posts, one on April 9, 2014 entitled Comprehensive Visualization of Future Paths of Technological Innovations and another on August 8, 2014 entitled New Visualization Service for US Patent and Trademark Data.)

Benson and Magee have devised an analytical means to sift through the USPTO database for precisely choosing the latest patents that “best represent” 28 specific technological domains. These include, among others,  “solar photovoltaics, 3-D printing, fuel-cell technology, and genome sequencing”. Then, applying their methodology, based upon the number of subsequent citations in other new patent filings, they were able to determine those some of the relevant patents displayed an increased likelihood in predicting “a technology’s improvement rate”. In effect, the higher the rate of subsequent citation of Patent X, the higher the rate of innovation. The equations in their predictive tool also include some other patent characteristics.

Among the 28 technologies, those showing the highest rates of advancement were “optical¹ and wireless communications, 3-D printing, and MRI technology²“, while others with slower rates of advance included “batteries, wind turbines, and combustion engines”.

Benson believes that his prediction method could possibly be useful to venture capitalists, startups³. Magee hopes that it may be applied as a form of “rating system” for investors searching out potential “breakthroughs”. Both developers also foresee the possibility that public and private laboratories could use it to investigate potential new areas for research. Furthermore, Magee believes that their approach can be applied to lower the level of uncertainty about the future of a particular technology to “a more manageable number”.

My questions are as follows:

  • Would the accuracy of the predictions from this new system be enhanced by applying its underlying equations to add in other data sources such as online news, social media mentions, and citations to other relevant industry news publications? (X-ref to the December 2, 2014 Subway Fold post entitled Startup is Visualizing and Interpreting Massive Quantities of Daily Online News Content.)
  • Could the underlying equations be applied to other fields such as law to predict the possible outcomes of cases based upon the densities and propensities of cases cited in similar matters and jurisdictions? What about possible applications in medical research or the financial markets?
  • Can levels of probability be quantified with this new system? For example, can it derive a 70% probability that driverless cars will continue to gather technological momentum and then commercially succeed in the marketplace? If so, how might such probabilities be used by the public, governments, researchers and investors?

 


1Could references to patents for optical technologies also be considered, well, cites for sore eyes?

2.  X-ref a September 3, 2014 Subway Fold post entitled Applying MRI Technology to Determine the Effects of Movies and Music on Our Brains.

3.  There are currently 22 Subway Fold posts on a broad range of startups in many industries.