So an informal non-aggression pact is nice, but absolutely no automobile manufacturer would rely on that when a new car costs a significant fraction of a billion dollars to bring to market. (If I were a cynical man, I might think this didn't escape their notice.)
If it were me, and the true intent was to distribute the Tesla patents as widely as possible, I would have said "Tesla pledges to license its entire patent portfolio, on a worldwide non-exclusive no-royalty basis, to any interested party. We will ask for consideration in the amount of $1 for a 99 year license. Your lawyers and accountants can reassure you that these sort of symbolic commitments hold up in court. They'll also no doubt ask to see the full terms, which are about as boring as you'd expect, and which are available from our Legal Department."
It seems to me that this press release was meant to invite interested parties to contact Tesla's legal department, though it didn't say so explicitly. If I ran a car company and saw this, that's what I would do, which I'm sure also didn't escape Tesla's notice. This press release seems more about announcing and explaining Tesla's intentions rather than acting as a binding agreement for a multibillion-dollar megacorp.
If I were Tesla, I'd also request that the licensing party grant a reciprocal bulk license to Tesla as well. Or, barring that, that Tesla reserves the right to revoke the license if you initiate a patent lawsuit against it.
I saw the press release as more directed towards average automobile buyers. As a "We will not be the ones preventing your favorite Automobile manufacturer from producing an Electric Car in the style you want, and neither will the research cost of the technologies we use".
I believe the message was phrased in a way to be directed at consumers so that hopefully the consumers will send a message one way or another to the other manufacturers causing them to come to more official agreements with Tesla. (which will of course have terms).
Isn't there a precedent? Volvo opening up the three-point seatbelt patents. Does anyone know the particulars of how that worked? My google-fu is weak, all I can find are articles that sound like PR.
I love Elon Musk, and kudos to them for doing this, but it's useful to read between the lines:
> Yesterday, there was a wall of Tesla patents in the lobby of our Palo Alto headquarters.
This is consistent with my view of how engineers in the traditional disciplines view patents.
> At Tesla, however, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla
This is the precise thing that patents are designed to prevent: to keep the market from turning into a race to see who can outsource most efficiently to China and inundate the public most completely with advertising.
> The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales.
So the other manufacturers didn't copy Tesla's technology, either because they are incapable of it or because they didn't feel there was enough money in it relative to their traditional markets.
> We believe that Tesla, other companies making electric cars, and the world would all benefit from a common, rapidly-evolving technology platform.
In other words, it helps Tesla more to have lots of companies developing electric cars to push back on regulatory barriers and consumer perceptions than it does for them to protect themselves against larger manufacturers copying their technology. Also buried in here is the assumption that Tesla is, now, far enough ahead of its potential competitors that it doesn't matter if they copy the technology.
I think this is the right move for Tesla, but there's a lot of dynamics at play that have nothing to do with the usefulness of patents in general.
>This is the precise thing that patents are designed to prevent: to keep the market from turning into a race to see who can outsource most efficiently to China and inundate the public most completely with advertising.
I have absolutely no idea how you possibly came to this conclusion.
This is the precise thing that patents are designed to prevent: to keep the market from turning into a race to see who can outsource most efficiently to China and inundate the public most completely with advertising.
Patents were largely designed to enable the state to have a selectively published library of what was being invented in the country and to reduce the power of trade guilds, who had huge power at the time. Offering a limited monopoly backed by force of law was one of the few incentives that worked for acquiring access to the kind of trade secrets you needed to keep your edge on the battlefield.
> In other words, it helps Tesla more to have lots of companies developing electric cars to push back on regulatory barriers and consumer perceptions than it does for them to protect themselves against larger manufacturers copying their technology.
Also, so somebody else will help pay for all of the Superchargers they want to build.
I think it partly an ethical thing. Patents doesn't (most of the time) benefit society, they only create monopolies (which are about as helpful as those in many socialist countries, i.e. not very much).
I think Musk cares more about advancing electric cars than suing and squeeze profits out of patent monopolies.
Alex Tabarrok comments on this: "I believe that this announcement will be discussed in business schools for years to come much like Henry Ford’s announcement of the $5 a day wage."
Interestingly, try navigating through – here's the link to page 14: https://www.google.com/?tbm=pts&gws_rd=ssl#q=inassignee%3A%2.... I remember reading or being told that Google only estimates how many results there are, and refines the estimate as you navigate further down the list. As of page 14 there seem to be only 133 results; a far cry from 6,430.
In the biotech space there exists a system called "patentleft" which theoretically provides royalty-free licensing of patents with the stipulation that any derivative works / improvements also be licensed under the same terms.
Seems like there is good potential to build on the momentum of Tesla's announcement to formalize the process, and answer the questions that I'm sure will emerge in this thread - eg more akin to an Creative Commons (which is very well defined and practical).
Sounds to me like the "in good faith" clause is to retain the patents for a defense should someone try to come after Telsa for infringing.
Quite an interesting business move and pretty unprecedented as far as I know, at least for a non-software company. Presumably he is hoping that this will encourage improvement to infrastructure. He is also probably thinking he can build higher quality cars and cheaper than others, irrespective of if they are electric or not (probably this is true).
That is certainly the most plausible reading of that phrase, but it still seems like it could be put into a licence pretty easily, along the lines of "User of these patents hereby relinquishes all claims of infringement against Tesla Motors for any patents the user may own or license".
> Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.
I'm not familiar with US legislation, but from my perspective this is just Musk on his soap-box making a statement. It's not something I can rely on while building a business that possibly (!) infringes one of Tesla's patents. They may retract their statement and reconsider at any time, especially when times get tough.
It's nice to hear this, sure, but I fail to see the meat in this announcement.
For example, using the Supercharger network requires that the automotive company offer energy for free for life to customers, and charge up front at the point of sale for all energy requirements for the life of the vehicle.
That's Musk's business model and is enforcing it for anyone who wants to use his "open infrastructure".
Which is bollocks to me: only wealthy people buying extremely expensive vehicles are going to want to prepay for a decade or two's worth of electricity. It means BMW and Audi will Supercharge, but Toyota and Ford? You can't ask budget customers to prepay a decade's worth of travel costs. You can't competitively and aggressively price a vehicle like that.
I imagine "good faith" means "follow OUR rules for the industry", which makes me sad. I'd like to see things be a bit more open than that, and I have very little doubt that this "standard" will be duplicated by companies unwilling to play by wealthy rules.
"In good faith" means that when you write to Tesla asking to license their patented technology at no cost as promised by their CEO, their lawyers write back saying "OK, if as a sign of good faith you also agree to license your patents to Tesla at no cost".
Agreed. I was hoping for a link to a BSD- or Creative Commons-style license, but this was only a reason for not [suing anyone] using the patents (as welcome as that is).
Until clarified, it kind of reads like "independently came up with the same idea, but did not research patents or reach out to us for licensing first."
Inspite of all the negative reactions here, I applaud this move.
The preceding statement to the one with 'good faith' is pretty important
>"If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal"
The interesting subtext here is that for Tesla to fulfil its potential more support for electric cars in wider society is needed, and while everyone else struggles to build electric cars the infrastructure won't catch up.
Opening up, in this sense, could be seen to be a selfish endeavour, but still a positive one, aiming to position Tesla as the Apple of the electric car market, only mildly less litigious.
I see this as essentially an open note to hardware tech companies asking them to come by and talk about licensing and interop deals without worrying that Tesla will be a hardcase about any possible IP infringement.
He makes an interesting implicit argument - that it's okay to use patents to block established players from innovating with you, but not to block new startups from challenging you.
He's not saying that. He's arguing that, were Tesla not to take the patents, there was a good chance one of the established auto makers would have taken them. This would have been the problem, as the entrenched players probably would have used the patents to stifle innovation in order to maintain dominance.
What can an innovator do besides filing a defensive patent?
I've heard of various strategies like publishing the work in as many forums as possible; publishing it on IP.com; filing a patent application and withdrawing it; filing it and pledging; etc.
It would be nice if there were a step by step guide written by an attorney--ideally an ex-patent attorney--that goes lists the steps in order of priority/cost/ease for both individual innovators and companies with deeper pockets.
There are almost no instances where patents turned out to be good for community. Wright Brothers stifled all competition by patent litigation causing US to be lightyears behind airplane tech. Edison similarly stifled lighbulb development causing Americans to pay for bad quality at higher prices than European counterparts. Steve Jobs tried to extinguish smartphone revolution causing funny things like removal of fairly generic features like pinch and zoom.
One would argue that they might not have been encouraged to invent these stuff if there were no patents. Even if that was true, the fact is that they had already ammassed massive fortunes even before they started patent wars. One would expect these visionary geniuses to let go patents in interest of advancing the state of art after they have gotten more money than they know how to reasonably spend. Elon Musk is the only one doing this here on the top of risking everything on fields that few entrepreneurs would dare. Hats off to him.
> At Tesla, however, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla. We couldn’t have been more wrong. The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales.
I read this as effectively saying that it's easy for them to take this step, relative to companies in other industries (Apple, Google, Amazon, et al) because none of Tesla's competitors even have the ability to make use of their technology. Makes me wonder if Musk would have done the same thing if Tesla were a software company.
This is a bold move, and of course open to interpretation. But I am still optimistic about it. You can argue why they have patents in the first place, remember that if they didn't or sold it to a third party it will come back to bite their ass.
It is much better to hold the patent and allow others to used without being worried about getting sued. I am sure the big auto makers may consider taking advantage of this situation to crush tesla, but Elon Musk is known for not getting distracted by the petty things.
[+] [-] patio11|11 years ago|reply
If it were me, and the true intent was to distribute the Tesla patents as widely as possible, I would have said "Tesla pledges to license its entire patent portfolio, on a worldwide non-exclusive no-royalty basis, to any interested party. We will ask for consideration in the amount of $1 for a 99 year license. Your lawyers and accountants can reassure you that these sort of symbolic commitments hold up in court. They'll also no doubt ask to see the full terms, which are about as boring as you'd expect, and which are available from our Legal Department."
[+] [-] chc|11 years ago|reply
[+] [-] andrewfong|11 years ago|reply
[+] [-] genericuser|11 years ago|reply
I believe the message was phrased in a way to be directed at consumers so that hopefully the consumers will send a message one way or another to the other manufacturers causing them to come to more official agreements with Tesla. (which will of course have terms).
[+] [-] slantedview|11 years ago|reply
[+] [-] kalleboo|11 years ago|reply
[+] [-] burnte|11 years ago|reply
[+] [-] rayiner|11 years ago|reply
> Yesterday, there was a wall of Tesla patents in the lobby of our Palo Alto headquarters.
This is consistent with my view of how engineers in the traditional disciplines view patents.
> At Tesla, however, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla
This is the precise thing that patents are designed to prevent: to keep the market from turning into a race to see who can outsource most efficiently to China and inundate the public most completely with advertising.
> The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales.
So the other manufacturers didn't copy Tesla's technology, either because they are incapable of it or because they didn't feel there was enough money in it relative to their traditional markets.
> We believe that Tesla, other companies making electric cars, and the world would all benefit from a common, rapidly-evolving technology platform.
In other words, it helps Tesla more to have lots of companies developing electric cars to push back on regulatory barriers and consumer perceptions than it does for them to protect themselves against larger manufacturers copying their technology. Also buried in here is the assumption that Tesla is, now, far enough ahead of its potential competitors that it doesn't matter if they copy the technology.
I think this is the right move for Tesla, but there's a lot of dynamics at play that have nothing to do with the usefulness of patents in general.
[+] [-] wyager|11 years ago|reply
I have absolutely no idea how you possibly came to this conclusion.
[+] [-] lotsofmangos|11 years ago|reply
Patents were largely designed to enable the state to have a selectively published library of what was being invented in the country and to reduce the power of trade guilds, who had huge power at the time. Offering a limited monopoly backed by force of law was one of the few incentives that worked for acquiring access to the kind of trade secrets you needed to keep your edge on the battlefield.
[+] [-] samolang|11 years ago|reply
Also, so somebody else will help pay for all of the Superchargers they want to build.
[+] [-] unknown|11 years ago|reply
[deleted]
[+] [-] sandstrom|11 years ago|reply
I think Musk cares more about advancing electric cars than suing and squeeze profits out of patent monopolies.
[+] [-] mwsherman|11 years ago|reply
Which amounts to “if we like you” and “we reserve the right”. If they wanted these patents to be open source, they would license them explicitly.
[+] [-] nbouscal|11 years ago|reply
http://marginalrevolution.com/marginalrevolution/2014/06/tes...
[+] [-] danielweber|11 years ago|reply
EDIT I should explicitly say that I am being sarcastic. Mr Tabarrok is believing what he wants to be true.
[+] [-] Arjuna|11 years ago|reply
https://www.google.com/?tbm=pts&gws_rd=ssl#q=inassignee:%22T...
Edit: Nice catch, peter_l_downs ... I didn't realize that the estimated search result of 6,430 would be off by such a large factor.
[+] [-] peter_l_downs|11 years ago|reply
[+] [-] pdevr|11 years ago|reply
How many times in the past has a private company opened up its core patents for everyone to use? There aren't that many precedences.
[+] [-] beltex|11 years ago|reply
https://www.flickr.com/photos/jurvetson/14405402742/
[+] [-] aresant|11 years ago|reply
Seems like there is good potential to build on the momentum of Tesla's announcement to formalize the process, and answer the questions that I'm sure will emerge in this thread - eg more akin to an Creative Commons (which is very well defined and practical).
http://en.wikipedia.org/wiki/Patentleft
[+] [-] graeham|11 years ago|reply
Quite an interesting business move and pretty unprecedented as far as I know, at least for a non-software company. Presumably he is hoping that this will encourage improvement to infrastructure. He is also probably thinking he can build higher quality cars and cheaper than others, irrespective of if they are electric or not (probably this is true).
[+] [-] oddevan|11 years ago|reply
[+] [-] hengheng|11 years ago|reply
I'm not familiar with US legislation, but from my perspective this is just Musk on his soap-box making a statement. It's not something I can rely on while building a business that possibly (!) infringes one of Tesla's patents. They may retract their statement and reconsider at any time, especially when times get tough.
It's nice to hear this, sure, but I fail to see the meat in this announcement.
[+] [-] ekanes|11 years ago|reply
[+] [-] swimfar|11 years ago|reply
http://www.wired.com/2009/08/strapping-success-the-3-point-s...
[+] [-] smackfu|11 years ago|reply
What exactly does that little "in good faith" clause mean in there?
[+] [-] baddox|11 years ago|reply
[+] [-] criley2|11 years ago|reply
For example, using the Supercharger network requires that the automotive company offer energy for free for life to customers, and charge up front at the point of sale for all energy requirements for the life of the vehicle.
That's Musk's business model and is enforcing it for anyone who wants to use his "open infrastructure".
Which is bollocks to me: only wealthy people buying extremely expensive vehicles are going to want to prepay for a decade or two's worth of electricity. It means BMW and Audi will Supercharge, but Toyota and Ford? You can't ask budget customers to prepay a decade's worth of travel costs. You can't competitively and aggressively price a vehicle like that.
I imagine "good faith" means "follow OUR rules for the industry", which makes me sad. I'd like to see things be a bit more open than that, and I have very little doubt that this "standard" will be duplicated by companies unwilling to play by wealthy rules.
[+] [-] notahacker|11 years ago|reply
[+] [-] vbuterin|11 years ago|reply
[+] [-] oddevan|11 years ago|reply
[edited for clarification]
[+] [-] McGlockenshire|11 years ago|reply
[+] [-] beltex|11 years ago|reply
https://www.flickr.com/photos/jurvetson/14405402742/
[+] [-] sidcool|11 years ago|reply
>"If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal"
[+] [-] fidotron|11 years ago|reply
Opening up, in this sense, could be seen to be a selfish endeavour, but still a positive one, aiming to position Tesla as the Apple of the electric car market, only mildly less litigious.
[+] [-] pnathan|11 years ago|reply
[+] [-] bthomas|11 years ago|reply
[+] [-] sdpurtill|11 years ago|reply
[+] [-] jaekwon|11 years ago|reply
I've heard of various strategies like publishing the work in as many forums as possible; publishing it on IP.com; filing a patent application and withdrawing it; filing it and pledging; etc.
It would be nice if there were a step by step guide written by an attorney--ideally an ex-patent attorney--that goes lists the steps in order of priority/cost/ease for both individual innovators and companies with deeper pockets.
[+] [-] dnautics|11 years ago|reply
This is another option (although kind of outside the box in terms of what RPX normally used for), although it's likely to be pricey: https://en.wikipedia.org/wiki/RPX_Corporation
[+] [-] sytelus|11 years ago|reply
One would argue that they might not have been encouraged to invent these stuff if there were no patents. Even if that was true, the fact is that they had already ammassed massive fortunes even before they started patent wars. One would expect these visionary geniuses to let go patents in interest of advancing the state of art after they have gotten more money than they know how to reasonably spend. Elon Musk is the only one doing this here on the top of risking everything on fields that few entrepreneurs would dare. Hats off to him.
[+] [-] methodology|11 years ago|reply
[deleted]
[+] [-] ajsharp|11 years ago|reply
> At Tesla, however, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla. We couldn’t have been more wrong. The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales.
I read this as effectively saying that it's easy for them to take this step, relative to companies in other industries (Apple, Google, Amazon, et al) because none of Tesla's competitors even have the ability to make use of their technology. Makes me wonder if Musk would have done the same thing if Tesla were a software company.
[+] [-] nullz|11 years ago|reply
[+] [-] Ryel|11 years ago|reply
[+] [-] ibrad|11 years ago|reply
It is much better to hold the patent and allow others to used without being worried about getting sued. I am sure the big auto makers may consider taking advantage of this situation to crush tesla, but Elon Musk is known for not getting distracted by the petty things.