Tuesday, December 10, 2013

Patently Unreasonable

There is nothing that disadvantages entrepreneurs and small businesses in the tech sector more than the patent regime.

Once again, I am looking at the opportunity to register what I believe is an incredibly valuable invention, but everything is stacked against me in doing this (I talk in the first person because patents are granted to individuals not organisations per se).

The advantages are obvious (or, if you like, patently obvious): you get twenty years of protection for an idea and the ability to exploit it without competition (unless you chose to licence your idea). In the UK there are significant tax breaks via the Patent Box scheme. In time, you can even aspire to becoming a patent troll, with no need to run a business - just sue everyone who comes close to your idea.

But the disadvantages are ludicrous. In an era where a business based on a strong innovation would be built and sold in a couple of years, just read this from the UK Intellectual Property Office website:

"From the time an application is filed, the UK patent application process can take 4 or 5 years, or even longer. There are ways to speed the process up, but these may not be in your best interests."

From the USPTO website:

"Currently, the average patent application pendency is 24.6 months. Applications received in the U.S. Patent and Trademark Office are numbered in sequential order and the applicant will be informed within eight weeks of the application number and official filing date if filed in paper. If filed electronically, the application number is available within minutes."

And then there's the tremendous cost. Unless you are a multinational with very deep pockets and a legal department, you are severely disadvantaged.

Giving tax breaks is one thing, presiding over a system that operates at 18th century speed is something else.

The UK needs more medium and large sized tech companies, but between lack of access to capital and liquidity, this is the most major issue holding back growth in the British tech sector.