Google’s Patent Purchase Program: What Did We Learn?

Recently, this blog discussed Google’s Patent Purchase Program (Program), here.  The Program was designed to help Google get in front of the patent troll problem by purchasing patents that could be acquired by patent trolls and subsequently used to “hold up” practicing entities.  Tam Harbert has published an article in the IEEE Spectrum titled, “Google Tries to Keep Patents Out of the Hands of Trolls.”  The article reports on the results of the Program.  Notably, the article states: “Internet Giant Buys 28% of the Patents Offered During Its Patent Purchase Experiment.”  The median price for a patent was $150,000.  The lowest price Google paid was $3,000 and the highest price was $250,000.  Interestingly, the highest submission offer was $3.5 billion and 47 percent of the submission offers were below $100,000.  The article notes that even though the Program was only available for three weeks “a few thousand” patents were submitted for consideration.  Around 28% of a few thousand patents is a significant number of patents.  It is unclear how many patents were purchased.  The article also notes that the value of the patents in this field are likely significantly less because of the U.S. Supreme Court’s decision in Alice.

As the article hints, a lesson from the experiment may be that we (of course) need a real marketplace for patents (with “less friction”).  Even with the short notice for the program as well as a narrow time frame to submit, there were many willing participants.  Moreover, a substantial number of the submissions were from individual inventors—about 25%.  Interestingly, this may indicate that individual inventors do not have many opportunities to monetize their patents and valuable patents may be “languishing” on the shelf, so to speak.  And worse yet, technology covered by those patents may not be commercialized.  This brings me to a second point.  What does Google plan to do with this patented technology?  The article also hints that Google acquired patents relevant to its business.  Will it actually utilize the technology covered by the patents?  Is it already using technology covered by the patents?  I suppose it could just sit on the technology and not use it.  Will it assert the patents against other operating companies? 

Notably, Google continues to accept submissions to consider patents—although not under the terms of the Program.  Will Google reopen the Program?

Google also has taught us that there are a lot of potentially valuable patents out there that could be successfully asserted against operating companies.  Good to know?  It doesn't seem like Google is widely publishing the results of the Program.