In The Knockoff Economy,we wrote about how turning products into experiences is one way to blunt the detrimental effects of copies. Products – especially digital ones – are often very easy to copy. But experiences can be highly copy-resistant. Just think of music: it’s easy to pirate a song, but it’s very difficult to effectively pirate a live show. Or movies: it’s easy to pirate a film, but it’s impossible to pirate the experience of watching a movie at a premium theater like The Arclight Hollywood in Los Angeles. You can’t cheaply copy the comfy reserved seats, the fancy food and drink, the great sight lines and sound.
All this, of course, comes at a price. But it helps justify the idea of going to a movie theater in an age when home downloads, on a widescreen computer monitor, can be pretty good. Read More »
This week in San Jose, a trial opened that may be the World War III of patents. Apple is suing Samsung, alleging that the Korean tech giant has knocked off many features of its iPhone and iPad. Apple wants $2.5 billion in damages – a record in a patent case — and a court order forbidding Samsung from selling some of its most popular phones and tablets in the United States. Samsung claims that Apple is the one stealing, and that some of Apple’s patents are invalid because they are so commonplace.
With respect to at least one of Apple’s patents, Samsung has a point. A patent at the heart of the dispute. Design Patent 504,889 — which lists Steve Jobs and Apple design guru Jonathan Ive, among others, as the “inventors” — is a claim for a rectangular electronic device with rounded corners. That’s right, Apple is claiming control over rectangles. The full claim is only 2 lines long, and amazingly broad – Apple is claiming all devices with the basic shape shown here. Read More »
Like a lot of products, pharmaceuticals get knocked off. And when that happens to a drug that’s protected by a patent, the next event is unsurprising: a lawsuit brought by the patent holder. But there is a very unusual twist in the pharma world. When the dust settles, quite frequently it is the major pharmaceutical firm that is paying the company that has knocked off their patented drug.
In one recent case involving Cipro, a widely-used antibiotic with annual sales exceeding $1 billion, Bayer (the patent owner) paid $400 million to a generic drug maker, Barr Laboratories, to settle their patent dispute. Why would the patent holder make such a huge payment to the knockoff artist, and not the other way around? Read More »
We’ve noted before on this blog that food receives limited protection from copying. But that doesn’t mean it receives no protection. As we all know, Coca-Cola’s secret formula is still secret. And sometimes food companies patent novel (and not so novel) dishes and techniques.
Patent and “trade secret” (the legal right Coke relies on) present very different economic benefits, however. Trade secret is forever—if the secret can be kept secret. Patent, by contrast, lasts 20 years and protects the invention against any copyist. More importantly, patent is fundamentally based on disclosure: to patent something, you have to explain how it works.
Almost a year ago, we posted here about patent trolling – when individuals and firms use patents as a tool to extract settlements out of defendants who wish to avoid expensive patent litigation, even when the target thinks it can ultimately win.
Because they can be so valuable, patents are a big source of litigation, especially in the tech industry. Apple and Samsung have been at each other’s throats over smartphone patents, as have Apple and Motorola. Microsoft has been battling with Motorola over whether its Xbox violates Motorola’s patents, and Microsoft has also threatened smartphone maker HTC. Oracle sued Google, claiming Google’s Android cellphone operating system infringed on Oracle patents. Microsoft sued Barnes & Noble, claiming that its Nook e-reader violates Microsoft patents. Apple and Google are now eyeing each other warily over “slide to unlock” technology that Apple has patented and accuses Google of copying in its Android smartphone operating system. Google, as a defensive move, paid $12.5 billion to buy Motorola’s portfolio of nearly 25,000 patents. Read More »
Our latest Freakonomics Radio on Marketplace podcast is called “The Patent Gap.” (You can download/subscribe at iTunes, get the RSS feed, listen via the media player above, or read the transcript below.)
It centers around a new working paper called “Why Don’t Women Patent?” and we talk to one of its authors, the Rutgers economist Jennifer Hunt. (We recently previewed this research on the blog, and some of Hunt’s earlier research too.) Read More »
We’ve blogged before about gender inequality and the persistent male/female wage gap. A new working paper by Jennifer Hunt, Jean-Philippe Garant, Hannah Herman, and David J. Munroe highlights another arena where women are lagging: commercialized patents. Only 7.5 percent of regular patent and 5.5 percent of commercial patent holders are female. The authors explored various explanations for the gap:
Read More »
Using the National Survey of College Graduates 2003, we find only 7% of the gap is accounted for by women’s lower probability of holding any science or engineering degree, because women with such a degree are scarcely more likely to patent than women without.