Tuesday, November 25, 2008

EETimes on RPX, again

As was the case in September, 2008, EETimes promptly followed up on a story in the Wall Street Journal on patent acquisition companies, including RPX. There was text:

"One of RPX's key value points is the speed of their decision making with respect to potential acquisitions, enabled by an independent team of professionals that does not require membership or investor approval," said Mike Mclean, vice president of professional services at Semiconductor Insights (Kanata, Ontario), part of United Business Media which publishes EE Times. "Speed is a strong differentiator in the patent marketplace as many sellers are as motivated by time to money as they are by the size of the offer," he added.

Canadians should well remember the case of NTP v. RIM (the maker of the Blackberry). In that case the relevant patent was in the control of a company of the inventor, who had tried to practice the invention, and did not surrender the patent to an NPE. People should note that RPX will offer no immunity whatsoever against strongly-motivated inventors who control their own patents. Further, in a market with "less valuable" patents, accuracy rather than speed will be the controlling variable in patent acquisition. Separately, one recalls Chester Carlson's patent on xerography, which Carlson tried to market to large companies, including IBM and Kodak. At one point, one of the large companies called in Arthur D. Little, who advised that xerography would not be commercially viable.

EETimes also wrote:

RPX is essentially a volume play, aiming to charge its members less per patent license than other approaches but hoping to harvest a larger set of customers. With membership fees starting as low as $35,000, "we provide a service for potentially thousands of companies," Amster said.

The company could continue to buy up to $100 million in patent rights with as few as ten members, but probably needs at least 20 members to remain cash-flow positive, Amster said.

To date, this is so much ink-splashing from the Wall Street Journal, which has otherwise not showed much knowledge of the patent system, a sad commentary on the nation's leading business journal.

See previous posts on IPBiz:

EETimes focuses on patent buying activities of RPX Corp.
. [18 Sept 08]



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