Another guest blog by IP mentor, Doug Calhoun
The McGuinnessInstitute is to be congratulated on its exhaustive analysis of science in New Zealand, “
The report will no doubt generate considerable debate.
In focusing just on the very brief patent policy aspects of the report I feel a bit presumptuous- like Spike Milligan when he wrote “Hitler: My part in his downfall.” But it is the patent bitabout which I would like to continue the debate.
In my first guest
“There is a lack of clarity surrounding the respective roles of MSI and the Ministry ofEconomic Development (MED) regarding economic development. MED clearly has a role in fosteringeconomic development and prosperity for all New Zealanders, and many of its portfolios are alignedto the six areas of investment determined by MSI: high-value manufacturing and services sector(HVMSS); biological industries; energy and minerals; hazards and infrastructure; environment, andhealth and society. It is not clear how the two ministries coordinate their strategies in theseareas given that the difficulty in distinguishing the stated aims of these two ministries has beennoted in the science-policy community.”
The report discusses the role of intellectual property on pages 72 and 73. The teaching that itextracts from the
What the McGuiness Report did not really get to is that the primary role of patents is toincentivise investment in the commercialisation of inventions.
A comprehensive study of the importance of patents to US entrepreneurs was the Berkley PatentSurvey that is discussed by its authors:
here
,
While they urge readers not to leap to too many conclusions, one common theme that comes throughis that patents are seen as being more important to the investors in entrepreneurial ventures thanto the entrepreneurs themselves.
There is some evidence of this in New Zealand. At the Grow Wellington launch of its Innovatingfor Health Challenge on 5 March, Robert Feldman, a venture capitalist with
1.Focused on the product that they are intended to protect,
2.They must be free of priorart, and
3.The entrepreneur must have freedom to operate.
4.The enterprise should have atrack record in New Zealand (Underlining the point I was making in my first post that NZ patents domatter!)
(“Freedom to operate” means that you have done a comprehensive search for other patents inmarkets you intend to enter and have determined there are no patents you are likely to infringe. And, if there are such patents, you have arranged to licence them or made some otheraccommodation.)
With some technologies, freedom to operate may involve having to navigate your way through adense patent thicket. How this is being done on a global basis through private collaborativearrangements is described in chapter 3 of the WIPO publication
The McGuinness Report (probably without realizing it) did consider one approach to solving theproblem:
“Creating better forms of co-creation based on collaborative practices betweeninstitutions, and new initiatives that allow inventions to be put into the public domain morequickly, seem part of the solution. For example, New Zealand could consider becoming a leader inCommon Patents [I think that should read a Patent Commons], patents that register the creator andare fully transparent, but allow free use with acknowledgement (along the lines of the approach usedby the Creative Commons, but through specific ‘New Zealand Invention Commons’). There areobviously a number of different ways to explore this landscape, but it is clear that such a system,which puts vast numbers of inventions into an open marketplace where entrepreneurs have access tothem, can help economic growth, health and well-being. The challenge is therefore to create a systemwhere new knowledge and technological advances are created and then traded in an open marketplace,which recognises the creator but also enables the entrepreneur to bring benefits tosociety.”
The reference to “patents that register the creator and are fully transparent” is a bit of amystery. All New Zealand patents do “register the creator” by the requirement to name theinventor(s). And before a patent will be granted it must describe how to put the invention intopractice – in terms that would be understood by someone able to put it into practice – so theyare “transparent”.
Firms who invest in R & D and seek to protect that investment through patents are hardlygoing to be motivated to give up their exclusivity by donating their patents to a Patents Commonwhen the only reward is an acknowledgement of authorship.
The “public domain” is a part of an “accessible domain” (there is a chapter in the book“Driving Innovation” by Michael Gollin on this). The accessible domain includes a vast PatentCommons of published patents in other countries that are not enforceable in New Zealand and NewZealand patents that are no longer in force because a renewal fee has not been paid. And theaccessible domain includes patents that others are prepared to license out a right to exploit. Freedom to operate can be thought of as finding a place in the accessible domain.
The WIPO Report at pages 118 and 119 explores why the open source software business modelseemingly exists without patents. Studies it refers to show that:
“both producers and users of open source products often blend participation in open sourceand proprietary software. In the case of producers, it is common for firms to develop bothproprietary and open source programs. Firms may also participate in open source software projectsstrategically to upset dominant players.”
It then asks:
“whether similar practices are transferable to other industries. Indeed, models of the opensource type have been applied to other innovative activity. However, their uptake appears lessspectacular than for software. One explanation may be that the success of open source software isclosely linked to the special circumstances of software development: projects can be broken intosmall, manageable and independent modules; input by geographically dispersed developers can beeasily shared; upfront capital costs are limited; and new products do not face lengthy regulatoryapproval processes. Nonetheless, additional opportunities for open source types of collaboration maywell arise in the future as technology and the nature of innovation evolve.”
The business models that the WIPO Report describes in chapter 3, such as patent pools and marketsfor the sale and purchase of patents or patent licences, are being used by those seeking to monetisetheir IP instead of the open source software model.
Both the Uniservices and the McGuinness Report say that a lot more research needs to be done(they would say that wouldn’t they). And that research should begin where the WIPO report leavesoff.
The McGuiness Report also mentions the importance of Talent (with a capital “T”). At theGrow Wellington launch Elf Eldridge promoted nurturing that talent with a dose of real worldinteraction through a programme to be run by Chiasma :
The Uniservices Report survey noted the shortage of understanding of the management of IP. Thecall for nurturing science talent should extend to nurturing IP talent in talented scientists.
~ Doug Calhoun
IP Mentor
Serial Stirrer