Patents? We don't need no stinkin' patents!...IBM pushes for patent reform

My friend Vinnie likes to take technology vendors to task for their lack of innovation. Hopefully he'll give credit where credit is due today as IBM has made an immensely important and forward-thinking step in helping foster innovation by leading the way for patent reform.

The New York Times has an article today outlining IBM's plans to revamp its patent disclosure and filing process.

Hoping to Be a Model, I.B.M. Will Put Its Patent Filings Online
By STEVE LOHR

I.B.M., the nation’s largest patent holder, will publish its patent filings on the Web for public review as part of a new policy that the company hopes will be a model for others.

If widely adopted, the policy could help to curb the rising wave of patent disputes and patent litigation.

The policy, being announced today, includes standards like clearly identifying the corporate ownership of patents, to avoid filings that cloak authorship under the name of an individual or dummy company. It also asserts that so-called business methods alone — broad descriptions of ideas, without technical specifics — should not be patentable...[click to read full article]

At the heart of today's announcement are the following points:

• Publication all of its patents (granted and pending) on the web
• Standards for clear disclosure of patent filers and holders (i.e,. elimination of shell companies and cloak-and-dagger names)
• No more patents based on business processes (without commensurate technical merit)

IBM CEO Sam Palmisano was quoted:

“The larger picture here is that intellectual property is the crucial capital in a global knowledge economy,” said Samuel J. Palmisano, I.B.M.’s chief executive. “If you need a dozen lawyers involved every time you want to do something, it’s going to be a huge barrier. We need to make sure that intellectual property is not used as a barrier to growth in the future.”

This is INCREDIBLY powerful stuff, and hopefully will light a fire under the current administration to expedite its long-debated patent reform legislation. Patent filings and litigation resulting from those filings has exploded in recent years. The absurdity of some of the filings is unquestionable. Big Blue has been granted more U.S. patents than any other company for 13 consecutive years (and are probably a good bet to take the crown again in 2006), with just under 3,000 issued last year. One would think they have a vested interest in protecting the status quo, but in fact they're pushing the envelope.

Today's news is an extension of work IBM has been doing with other companies on patent reform. IBM worked with more than 50 companies on patent reform guidelines in a collaborative wiki and published the findings in a report: Building a New IP Marketplace.

Hats off to Big Blue on a very progressive idea, and one that is not without business risk. Ultimately IBM executives have the right idea, which is to say if pending patents are truly innovative and based on technological advances, the fact they're public poses no real threat.

Related Posts:

• Brad Feld: IBM Takes Another Step in Reforming the Patent Process
• Fred Wilson: Do Patents Encourage or Stifle Innovation

Note: At the time of this writing I, and/or funds I maintain discretionary control over, did not maintain a position (long or short) in IBM.

ibm patents reform ip woodrow

Comments

[vinnie mirchandani]

Jason, any revised thoughts now that IBM is going after amazon?

[Dennis McDonald]

I recommend reading the whole report especially the section on "valuation." The basic thrust of the whole report is to increase the openness of the entire patent process, not just the front end "prior art" research that is addressed by the Peer to Patent project. My review is here:
http://www.ddmcd.com/new_IP_marketplace.html

[James]

Is IBM committing to doing this with 100% of their patent applications? If so, that's impressive. If not, it becomes a tool of convenience for them, where patents that they want to remain secret still go through the conventional process (that is, publish after 18 months).

[vinnie mirchandani]

Jason, I actually would like to see more patents - meaningful ones and not just for trolling.

What's interesting is how little of IBM's services and software revenue - almost 75% of revs is driven by new patent (or now patented) driven innovation (as you know their s/w growth comes mostly from acquisitions) Much of its advanced R&D is around supercomputing, RFID etc which makes up less than 10% of IBM revenues.

They spend only 6% on R&D but market quite a bit about innovation...see my posts below

http://dealarchitect.typepad.com/deal_architect/2006/03/ibms_research_j.html

http://dealarchitect.typepad.com/deal_architect/2006/04/ibm_innovative_.html

Patented or not, for the dollar customers should be seeing more innovation and forward progress...