The number of patents issued in the past 10 years has
risen to 958,000 in 2004 from about 642,000 in 1995, in part because of breakthroughs in digitization and the life sciences. In the United States to Europe and Japan, more patents were sought in the past 20 years than in the previous 100, evidence that protecting the rights to an idea is itself growing in importance. Patents "are becoming the highest-value assets in any economy," said Jerry Sheehan, an economist with the OECD in Paris. In the information economy of the 21st century, the most priceless resource is often an idea, along with the right to profit from it rather than natural resources. The right to profit from a breakthrough idea can be so valuable that the contest over the concept can be more decisive than the competition for consumers, as Sony and Toshiba demonstrate in their tug of war over whose next-generation DVD patents will win out, long before the discs come to market. One view is that,it is a mistaken belief that software patents actually protect large vendors. While covering Microsoft's recent frenzy of patents acquisition, I wrote that, it may be time to abolish software patents. Microsoft has filed very high number of patent applications in the US, which are under review currently - the pace of filing: 60 fresh, non obvious patentable ideas every week. Reason for sudden increase in applications - Microsoft says it finds that others file about two patents for every $1 million spent on research and development. If Microsoft was spending $6 billion to $7.5 billion annually on its R&D, it would need to file at least 3,000 applications. Abolishing software patents would be a very good thing,as increasingly the current system actually impedes the advance of software technology, at the same time that it works quite nicely to enrich patent holders.
The skyrocketing volume of patent applications makes it increasingly difficult to assess whether the underlying ideas are valuable, nonessential or even valueless. Critics also say the current system encourages using the courts to sue other firms for using ideas you registered first. Today, the process for capitalizing - either financially or socially - on innovation and creativity is staggering under the strain of a digital revolution of a speed and scale never seen before. Some hold the view that the technology companies are beginning to realize they have more to gain by releasing patents to the general public than by hoarding licensing income. The real problem is how to fashion a system that promotes innovation, not mere accumulation. If savvy entrepreneurs can manipulate the system by locking down valuable ideas, true pioneers will find it too tough to win rewards for their inventions. Some may take the view that imitation is the best form of flattery but the patent acquisition binge is bound to go up. Patents may well become an important index of popular technolgy adoption in the days to come.