This morning, I read an article from Thomas Reuters that talked about how not only the smartphone and technology industry, but other businesses located in industries such as energy, health care, and manufacturing intend to increase intellectual property litigation spending. By a survey of around 400 companies, it was found that around a quarter of those firms will be involved in more lawsuits concerning patent litigation compared to the last several years. Thus, companies have decided to increase their intellectual property litigation budget, meaning that they will decrease spending in other areas, such as development of their products.
As I have previously discussed in my previous posts, I hope this will not impede the production of new products and advancements of the companies. For companies with more than $1 billion in annual revenue, it is said that participating in lawsuits over intellectual property costs them at least $1 million each time.
The graph below (data only till 2010) suggests that the number of patent lawsuits will continue increasing, even at a slow rate. By further research, I found out that the number of such lawsuits slightly decreased in 2011, but rose again in 2012. Most likely, we will see another increase this year.
Last class, we spent some time talking about patent trolls, so I decided to look further into it. To clarify, a patent troll is a company or person that acquires a lot of patents without having any plans to actually produce the products.A patent troll usually obtains these patents from bankrupt companies at extremely low prices, or by doing some research so that they can prove that they obtained the idea first. In other words, it is their business strategy to acquire as many patents as they can, launch lawsuits against any infringing companies, and make money off of them/disable them from producing the products. Therefore, it is clear that patent trolls are killing innovation and not valuable to the market; a study out of Boston University estimates that the direct economic damage that patent trolls cause are about 30 billion dollars a year.
Because patent trolls have been increasing over the last several years, President Obama has also brought his attention to this issue. He is strongly in favor of patent reform, saying that patent trolls simply "leverage and hijack somebody else's idea and see if they can extort some money out of them."
I wonder how the reform will take place; the President attempted a reform a few years ago as well, but people say it only went halfway. Hopefully this time, a noticeable transformation will take place in the patent system.
HTC and Apple were going under a large number of patent disputes starting in 2010. It all started when Apple filed lawsuits against HTC, claiming that they infringed upon about 20 of their patents relating to iOS. For two years, they have gone back and forth with suing each other.
However, last November, both companies were able to settle down, as they dismissed all of their lawsuits against each other. They also agreed to a ten year licensing agreement, so they will be able to use each other's patents. In other words, we should not see these two companies fighting each other anytime soon. Although details about the settlement were not released, analysts claim that Apple will receive around $8 in licensing fees for every HTC smartphone sold.
It's unclear what exactly enabled them to come to terms with each other, but it is most likely the amount of money both of these companies were wasting just because of lawsuits. Apple reportedly burned 100 million dollars against HTC just in the first round of their legal battle. But now, since Apple is going to receive those licensing fees for every HTC smartphone sold, its looks like they'll get their 100 million back: those licensing fees will add up to around 280 million dollars a year!
Rumors say that Apple is developing a new product called the iWatch. It's supposed to be a wearable computer in a form of a bracelet that could double as a watch. It will be able to accomplish many different tasks, such as playing music, reviewing phone calls, and surfing the web. Just like the creation of the iPhone and iPad several years ago, people predict that this iWatch will begin a new era for the technology industry.
Well, Apple is not the only one that seems to be developing a wearable computer. Google is planning to put out a new product called the "Google Glass" on the market in 2014. This product will not be in form of a watch, but glasses; it will have a display, a camera, and the ability to connect to the Internet via Wi-Fi and Bluetooth. In addition, people also say that Samsung is in progress of developing a "smartwatch."
It's great that these companies are coming up with these new products that could generate huge revenues and returns for shareholders. However, just like the smartphones, I have a feeling that these products will produce a new set of patent wars. After all, there are already wearable computing products out there, such as the FuelBand from Nike, and the Flex band from Fitbit. On a side note, Apple has already filed a number of patents for the iWatch, one including a wristband that uses a bi-stable spring, similar to a snap bracelet.
Reading about the ongoing patent wars between companies like Apple, Microsoft, Samsung, LG, and others was making me a little intense, so I decided to shift my focus a bit. I did some searching on some of the weirdest and most peculiar patents ever.
The first weird patent that caught my eye was the "Anti-Eating Face Mask." It is basically a mask that people can wear so that their mouth is completely blocked. It was invented in order to help people who are on a diet. Similar to this invention, another patent is the "Thumb Sucking Inhibitor." This is just a metal device that people can wear on their thumb so they will not be able to suck on it!
An interesting patent is the "Motorized Ice Cream Cone." This was invented by a teacher; he put a motor inside a cone-shaped machine to automatically spin the ice cream, so people don't have to outstretch their tongue. Apparently, this was a success, as he sold thousands of these.
Many other interesting, weird, and/or funny patents exist. Here are a couple sites:
Yesterday in class, we spent a lot of time talking about patents, particularly for smartphones. Typing in "smartphone patent war" in Google brings up millions of news about it, particularly the fight between Apple and Samsung.
I've encountered many articles that talk about how more money is spent on patent litigation than research and development for the company's products. By an analysis done by Stanford University, it was shown that more than 20 billion dollars were spent over the last two years by the smartphone industry for patent litigation and patent purchasing. It's really a shock that these companies nowadays are more busy suing each other than creating new products and innovations.
Because of such cases, some people think the patent system should be abolished. This sounds a little extreme, as I think there should be certain rules and regulations; without them, there is a possibility for a different type of chaos. I'm not sure what types of changes and reforms will bring an end to this smartphone patent war, but hopefully companies will focus more on producing the best technologies in the near future.
After reading about some news regarding trademarks, I began to wonder whether "anything" could be accepted as trademarks. After doing some searches on Google, I found out there were some failures in obtaining trademarks.
For example, Twitter failed to trademark its phrase "tweet," just because a third-party developer trademarked it before them. So instead, Twitter went ahead and trademarked the phrase, "let your ad meet tweets."
Former vice president candidate Sarah Palin also failed to trademark something. What did she try to trademark? Her NAME.
There are plenty of other examples of failures in trademarking, but some companies are waiting on their trademark application to be accepted.
For example, Subway has tried to trademark its phrase "footlong" for several years now, but other fast food chains have heavily opposed to this, disabling Subway to hold any rights to this phrase.
There are several more notable examples here:
http://www.businessinsider.com/15-ridiculous-trademarking-attempts-2011-4?op=1
After yesterday's class, I got more interested in learning about trademarks, so I searched for some news on them. I found a very interesting article; it was about Apple trademarking its shops. In other words, they have trademarked its layout of the store.
This article stood out to me, as Apple stores are simply large rooms consisting of long tables and stools, each of them having either computers, iPads, iPhones, and/or iPods on them for display. As a matter of fact, I have seen other companies' stores having the same layout, like Windows and phone shops like T-Mobile and Verizon.
It seems like what Apple wanted to do was fight the fake Apple stores increasing in China and some other countries. Buy my question is, what will happen to those stores such as Windows who have similar layouts as Apple stores? Will they be forced to change their design? This is a little unreasonable to me, as it's not like the layout of the Apple stores are extremely unique.
