Category Archives: Patent

Major Patent Holding Company Now Demanding Large Fees and Expanding in Asia

Intellectual Ventures, the patent holding company started by the former CTO of Microsoft, Nathan Myhrvold,  has begun obtaining payments from licensees in the $200 million to $400 million range, according to a recent front-page Wall Street Journal article (Tech Guru Riles the Industry by Seeking Huge Patent Fees, by Amol Sharma and Don Clark, September 17, 2008).

In an interesting twist, many of the licensees also agree to become investors in investment funds operated by Mr. Myhrvold’s company.  The Journal reports that the company has not filed any infringement lawsuits yet against potential licensees — although this remains an “implicit threat” — but Myhrvold told the Journal that $1 billion in licensing fees have been returned to investors so far.  (This profitability apparently isn’t widely spread among other patent holding companies.  The Journal also reported that publicly-held Acacia Research Corp, which has several pending lawsuits against licensees, reported a net loss of $9.5 million in the first half of 2008.)

IV also announced plans to open offices in five Asian countries, including a new regional headquarters is in Singapore.

For an inside look at Intellectual Ventures, be sure to read Malcolm Gladwell’s recent profile in The New Yorker.

Patent Factoids

Some factoids about patents: Typical cost to obtain a U.S. patent: $5,000 to $25,000.  Cost to invalidate a patent: Legal fees average $4.5 million in patent disputes where more than $25 million is at risk. Cost of obtaining a patent versus invalidating one: You do the math. Number of inventions under active patent in theContinue Reading

Size of the Intangible Economy

How large is the intangible economy in the U.S.? U.S. businesses invest about $1 trillion in intellectual property and other intangible assets, according to a study by the Federal Reserve Board.  That’s as much as they invest in equipment and other tangible investments. Intangible assets, including intellectual property, constitute nearly 1/3 of the value ofContinue Reading

Tension between Quality Methodologies/Six Sigma and Innovation

Business Week ran an interesting cover story about the tensions between quality methodologies such as Six Sigma, and innovation and creativity. In sum, "while process excellence demands precision, consistency, and repetition, innovation calls for variation, failure and serendipity."  According to Management Professor Vijay Govindarajan, "the more you hardwire a company on total quality management, [theContinue Reading