Inefficiencies in Essential Patent Pool Formation; Are Pool Administrators Also Involved?

32 Pages Posted: 3 May 2018

See all articles by Pooyan Khashabi

Pooyan Khashabi

Ludwig Maximilian University of Munich - Institute for Strategy, Technology and Organization (ISTO)

Date Written: April 16, 2018

Abstract

Technology standards are becoming increasingly important in economic extent. Facilitating and building patent pools for technology standards is a crucial part for their success, which is done by pool administrators. Practitioners believe that political economy of pool formation has lead to inefficiencies such as failures in launching new pools and inclusion of non-essential patents (pool inflation). However, the potential role of expert pool administering party on the efficiencies has not been studied yet. This paper develops a simple model of pool formation which determines the optimal strategies of a rent seeking "pool administrator". The results show that pool forming strategies by the pool administrator may contribute to failures in patent pool formation process. Also, in the environments where the essentiality claims are difficult to assess or in industries with higher pace of technology, the pool administrator may find it optimal to include the patents in the pool regardless of the essentially evaluation (pool inflation) and launch the patent pool faster.

Keywords: Patent Pool, Essential Patent, Patent Pool Administrator, Technology Standard

JEL Classification: K00, K11, O34, L40

Suggested Citation

Khashabi, Pooyan, Inefficiencies in Essential Patent Pool Formation; Are Pool Administrators Also Involved? (April 16, 2018). Available at SSRN: https://ssrn.com/abstract=3163726 or http://dx.doi.org/10.2139/ssrn.3163726

Pooyan Khashabi (Contact Author)

Ludwig Maximilian University of Munich - Institute for Strategy, Technology and Organization (ISTO) ( email )

Kaulbachstr, 45
Munich, 80539
Germany
+49 89 2180 5415 (Phone)

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