Accumulating a war chest
In recent history, large companies seem to have adopted a strategy of mutually assured destruction with regard to patents. Many companies amass war chests of patents with the silent (and sometimes not so silent) implication that any patent suit will result in a countersuit of equal fervor.
Just in the year 2010, IBM claimed nearly 5,000 patents with Samsung and Microsoft close behind. And with some minor exceptions, this strategy of threatened retribution seems to have worked to keep large companies from suing other large companies over patent claims.
Changing winds?
Todays news that Kodak is suing Apple and Research In Motion (maker of the BlackBerry) over alleged patent infringement seems to fit in with a growing trend of large companies resorting to patent claims as a competitive strategy. And in some cases, these patent strategies are having considerable impact. i4i recently won a lawsuit against Microsoft which threatens to make the software maker stop selling its flagship Word product.
What this means for the little guy
Small companies are also at risk from the current patent situation. This week, Union Square Ventures published a very compelling story describing how 1/3 of their portfolio was “under attack by patent trolls”. I’m certain that very few would argue with the fact that our patent system is broken in its current state and needs to be drastically reworked.
Unlike some, I see hope in the latest patent litigation trends. Up until now, big companies have been able to tolerate the patent system as a necessary evil. As this strategy breaks down and large companies incur substantial financial impact, they will be forced to move. There will finally be sufficient money flowing to organize, lobby, and create public awareness that will eventually bring patent reform – reform that is entrepreneurs desperately need.
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