Google hands out patents in return for LOT network membership to tackle the patent trolls
Google plans to give small companies a couple of starter patents to help protect its own intellectual property (IP) and assist the establishment of a new business.
The scheme began life back in April this year as an experimental marketplace. Called the Patent Starter Program, Google said the marketplace is intended to curb the sale of intellectual property to entities known as “patent trolls” – which exist solely to exploit the patents they own.
That marketplace initially allowed companies to sell their patents, with Google being the sole buyer. But now Google has changed this marketplace and is now using it to give away, free of charge, “up to two non-organic patent families” according to Techcrunch. Companies can also apparently make offers to buy patents from it in the future.
This scheme is only be open to the first 50 eligible startups, and to qualify, companies have to have had 2014 revenues between $500,000 and $20 million.
Also, once the company applies, they will be sent a list of three to five families of patents. The company can only select two of them. “Google will retain a broad, nonexclusive license to all divested assets,” the company notes.
Participants will also be given access to a database of patents that Google has purchased from third parties, which they can use to find assets that it may be willing to sell.
Whilst the patent giveaway is free, Google does require the company involved to sign an agreement to join the LOT Network for two years.
The License on Transfer Network was founded by Google, SAP, Canon, Dropbox, US retailer Newegg and Asana last year as a patent licensing network. This network aims to protect members against patent privateering (i.e patent trolls), as the LOT database already has an estimated 325,000 patent assets.
“The LOT Network is a sort of arms control for the patent world,” according to Allen Lo, deputy general counsel for patents at Google, speaking last year. “By working together, we can cut down on patent litigation, allowing us to focus instead on building great products.”
The constant threat of legal action has been blamed for slowing down the pace of innovation, increasing prices to consumers and lowering returns to shareholders, among other things.
Google of course owns thousands of patents, including the huge ‘war chest’ it acquired in the purchase of Motorola Mobility, the company which it later sold to Lenovo, minus the patents of course. SAP is though to be one of the biggest software patent holders in Europe.
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