Linked by Thom Holwerda on Thu 5th Jul 2012 23:07 UTC
Legal Since I want to get this out of my system: here's a set of proposals to fix (okay, replace) the current failing patent system. No lengthy diatribe or introduction, just a raw list.
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I can be more simple
by Kver on Sun 8th Jul 2012 18:46 UTC
Kver
Member since:
2012-07-08

I've thought about it carefully myself, and I signed up just to post this;

The most simple thing I thought of for the whole patent mess is to just price patents on an exponential basis; start patents off at a low price, $50 to actually file a patent; but every patent filed is more expensive. I've come up with an exponential curve of...

$50 + (1.03^X)

Where X is the number of patents an entity can access. When I refer to an entity, I'm referring to a company, its subsidiaries, board members or significant shareholders who would all count into the exponential price - though it doesn't necessarily mean the parent company has licensing rights to those patents.

Part of this is that upkeep would be required, just like domain names you'd have to pay yearly to keep it active (though they would still have a maximum lifespan). In addition, when the yearly payment is due, the patents a company wishes to keep have to be specifically listed. Any patents that aren't renewed become public domain.

So if Maxis had 50 patents and EA (owner of Maxis) had 200, Maxis would pay dues for 50 patents ($2612.80/yr) and EA would pay dues for 250 patents (66440.71/yr)

I would still allow entities to transfer their patents, however the lifespan of the patent would be halved every transfer. This would include the situation of two companies merging or one company being bought out. The only exception would be if a patent had less than five years until expiry. E.g. A subsidiary could sell its patents to a parent, but a patent with 20 years would be halved to 10. A patent with 8 years would be almost halved to 5. This would still allow a great idea to be sold, but it would prevent ideas from being hoarded because those ideas effectively halve in value every time they're sold.

Since the fees are much lower a small company who is struggling to produce their patent can afford to hold onto it if it's really worth it while building a product. On the other hand, if you're a patent troll it would become difficult to own enough patents because of the cost of owning large numbers of patents. Patents would eventually hit a threshold and become too expensive for a company surviving on lawsuits.

As an example;

A small innovative company is not likely to have more than a few patents, or even a couple dozen if they're busy beavers. If they had 25 patents, their most expensive patent would cost $54, and they'd be paying 2721.70/yr to keep those patent from public domain.

If a large company like Google had 400 patents, their most expensive patent would be $132,500/yr and their yearly payments would be $4,567,423/yr.

If a company is registering a 469th patent, that is a million dollar patent. If you are Microsoft or HTC or Google and you really believe your patent is that valuable you will make the hard decision to either pay that much or dump less valuable patents.

Overall, it keeps it open to individuals who could easily afford those small fees, and ensures companies responsibly choose which patents are actually valuable. If a company with clout feels it can make a billion dollars off a great idea, spending $1,000,000 on a 469th patent for even a year makes sense. Also, the threshold for having enough patents to establish an effective patent-trolling firm is too steep; the 500th patent would cost 2,500,000/yr.

In my opinion, I look at each patent like it should be the next million dollar idea. That's what patents are for, protecting innovation to help the common man unleash those brilliant ideas, and help big companies protect themselves from millions in R&D being stolen.

Microsoft hit 1.2 billion dollars in sales and it owned only 5 patents. I think my formula is actually too forgiving, I'd adjust it so 50 patents would begin to be pricey. If something like this was implemented now, a very conservative formula could be used and every year be tightened until it hits its final number. Companies would be forced to gradually sift through their ridiculous portfolios and weed out the worthless materials until eventually settling on the real inventions and designs they should actually be proud of. But even my forgiving formula will never see the light of day, things will just stay broken - and that's just sad.

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