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September 26, 2006

IBM Patent Exposure

The New York Times reports that IBM, America's patent gorilla, is going naked about its patent filings. Does showing that its patent applications are well hung really do anything? Maybe.

The downside seems obvious.

“Competitors will know years ahead in some cases what fields we’re working on,” said John Kelly, senior vice president for technology and intellectual property at I.B.M. “We’ve decided we’ll take that risk and seek our competitive advantage elsewhere.”

To buy the rationale put forth in the NY Times article, that IBM is self-imposing some kind of patent reform, is pure theatre. The move is clearly a publicity stunt, with likely a few unstated motives.

IBM is now primarily a services company, and increasingly its customers are using Linux. This seemingly open approach may be intended in part as appeasement to that customer base. 

This could serve as a hiring tactic, to entice talent away from the competition by IBM flaunting its serious intent & investment in cutting-edge technologies.

IBM, like the rest of the large computer technology companies, are afraid of the trend that small-time inventors can increasingly enforce their patents. Licensing companies like Acacia, and rocket docket patent courts, like the Eastern District of Texas, are leveling the playing field. The tactic of burying inventors in legal costs for years doesn't work like it used to. IBM's move is intended in part as an cry for legislative relief.

In no way does IBM intend to shun patenting. John Kelly's statement about sacrificing competitive advantage has a nice ring, but is facile, as its patent applications are published within 18 months anyway. As the NY Times article points out, IBM still intends to maintain intensive corporate intelligence, just as its competitors do.

I.B.M. also said that its technical experts will spend “thousands of hours” a year scrutinizing the patent filings of other companies.

Posted by Patent Hawk at September 26, 2006 12:07 AM | Patents In Business


Patenty Hawk wrote:
"IBM, like the rest of the large computer technology companies, are afraid of the trend that small-time inventors can increasingly enforce their patents."


Do you really believe it?

The trend is just the opposite - after recent court decisions (Ebay) it is getting increasinbgly diffucult to get attention of large corporate infringers.
Think about NTP vs. RIM case..

Do you think that after Ebay decision RIM would settle the case ? They would probably contunue to fight for year and years, in the absense of injunction threat...

Posted by: small inventor at September 27, 2006 1:29 PM

in reply to small inventor's comment:

NTP scored over RIM, and had deep enough pockets to pursue the case.

eBay limited injunctions, yes. Hard to say how things might have gone for RIM if the eBay ruling had happened first. One speculation is that RIM saved itself hundreds of millions in damages by settling, thus, the threat of injunction helped RIM from its own self-destructive course, which it seemed hell-bent on at the time.

The fact is, though, just like NTP, Acacia and other patent licensing companies have deep enough pockets to pursue infringers to the bitter end.

It remains to be seen what effects limiting injunctions have, either in terms of dragging out the fight, or encouraging settling because of the potential of increased damages because injunctions are off the table.

Posted by: Patent Hawk at September 27, 2006 3:25 PM