Patent Portfolio Races in Concentrated Markets for Technology
Technische Universität München (TUM)
TUM School of Management - Technische Universität München (TUM) ; Centre for Economic Policy Research (CEPR)
November 25, 2012
Patent application numbers grow exponentially in many industries, a phenomenon that has been linked to high fragmentation of patent ownership. Contradicting these findings and theoretical arguments, we show that such fragmentation is not a precondition for sudden and strong increases in patenting. We describe and analyze a patent portfolio race in an industry with highly concentrated patent ownership, namely the newspaper printing machines oligopoly. Triangulating data from patent analysis, interviews, and document research, we find that patent strategy change by one player triggered a patent portfolio race with its main competitor. Implications for managers are that increasing patent output may yield temporary advantages but, as in a price war, implies the risk of a prisoner’s dilemma-type outcome with potentially severe implications for effectiveness and efficiency of the innovation process.
Number of Pages in PDF File: 40
Keywords: Patent strategy, motives to patent, intellectual property, patent thickets
JEL Classification: A10, L1, L13, L6, M1working papers series
Date posted: September 8, 2010 ; Last revised: November 25, 2012
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