Do patents support or restrict innovation for large organisations and likewise do patents support or restrict innovation for

Do patents support or restrict innovation for large organisations and likewise do patents support or restrict innovation for start-ups / small and medium-sized firms?

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IntroductionThere exist strong evidence that state that patents have many positive effects on innovation. New small and medium-sized organizations are the ones most influenced by patent policies and laws as compared to already existing organizations (Anand & Galetovic 2004). The start of large and small innovations leading to the development of new industries from cars to chemical, TV and Radio to computers as well as to investment banks are affected positively by the patent environment. None of the above innovations have ever been born out of patent laws or policies, but from a highly competitive business environment. It is only after the early stages of explosive innovation that lead industries to turn to the legal protection of patents (Barrett 2012). The paper will also discuss alternative strategies that can support more innovation from happening or taking place. The motivation of innovators should be encouraged. Therefore, patents support innovation for small and medium-sized organizations as well as large organizations.Patent EvaluationTo evaluate optimum patent protection for an innovation, both the cost of copying and that of inventing have to be considered. The higher the ratio of the former, the greater the patent protection for the investor (Kitching & Blackburn 2003). This ratio is higher for pharmaceutical drugs as compared to other innovations. For example, the cost of inventing a drug incorporates an extensive testing cost before the drug is approved for sale. Thus, it is noted that if patent laws exist, the cost of production will not be felt as the sales will be controlled hence reasonable profit will be ripped. This evaluation denotes that patents are not only important to innovation but also supports this art (Leiponen & Byma 2009). On the contrast, many scholars state that patents create restrictions to innovation. The nest section will highlight this in length.The Value of Patent InsuranceAt the point when patent insurance furnishes an inventor with more protection from competitors then it is expected that he/she will have a satisfactory motivation to make come up with the innovation (Lu 2007). The outcome is to build business costs above proficient levels, bringing about contortions in the distribution of assets; to incite inefficient patent competition. Inefficient due to duplication of application and in light of the fact that superfluous to actuate development (however the competition increases the pace of innovation). This builds the cost of seeking the records of the Patent and Trademark Office so as to verify one isn’t going to be infringing somebody’s patent with your development (Mansfield 1985). To support the documenting of protective licenses in light of suspicion that another person will patent a comparative item and blame the inventor for violation and to empower patent “trolls,” who purchase up expensive quantities of licenses for the sole motivation behind removing licensee expenses by risk of suit, and if vital sue, for violation .Inordinate Patent PolicyThe issue of inordinate patent policy is at the very most delineated by the product business. The world is overflowing with innovation development. The conditions that make patent policies vital in business are missing (Tang 2003). Today, most technological development is incremental, made by groups of technological architects at modest expense, furthermore most technological innovations are immediately outdated. Technological development has a tendency to be disconnected; not whole tools, however parts, so that a product innovation may have many thousands. The outcome is colossal patent bushes, making rich open doors for attempting to hamstring contenders by suing for violation furthermore for encroaching, and afterward difficult the legitimacy of the patent when the patentee sues you (Tang 2003).Comparison of Intellectual property Laws and Patent LawThe issue of copyright law is less intense as compared to that of patent law because copyright violation is restricted to copying (Thomas 2003). The patent violation does not oblige confirmation even that the infringer was mindful of the patent that he was encroaching. All things considered, as on account of patent law, copyright security appears to be in general excessively far reaching. In all actuality, with cutting edge activity films frequently costing a huge number of dollars to make, yet copiable very nearly instantaneously and ready to be both duplicated and conveyed costless. The requirement for copyright insurance is similar to that in the pharmaceutical business (Von Hippel 2005). The other amazing issue is scholarly books and articles, which are produced as a consequence of scholastic research that the writer must lead to saving. This leads to an expert notoriety that would keep on being delivered regardless of the possibility that not copyrightable by any means. It is suspicious that there is any social advantage to the copyrighting of scholarly work other than course readings. It obliges a considerable measure of work and, for the most part, don’t improve the writer’s scholastic notoriety and may undermine innovation in the industry (Von Hippel 2005).Protection Strategies to be adoptedIt is vital to note that there are various production strategies that could be used to beef up the game towards support of innovation as compared to patent laws. First, product complexity is the best strategy to adopt in the current market. A good example of this strategy is the one used by Coca-Cola. If such strategies are to be used in the current market, then they will be various benefits granted to innovators (Mansfield 1985). This creates a unique product that other companies or competitors are not able to copy. Secondly, the creation of better standard will be an alternative to patent. Standard products will offer a solution because there will be no room copy the products or to create alternative products (Leiponen & Byma 2009).ConclusionI conclude that patents promote as well as hinder innovation to large, small and medium sized companies. Thus, is can be deduced that it has both advantages and disadvantages to innovation for start-ups / small and medium-sized firms. However, innovators should adopt alternative strategies for them to improve their production. Moreover, countries or nations should amend their patent laws to favour more innovator.

Reference

Anand, B. and Galetovic, 2004, ‘How market smarts can protect property rights’, Harvard Business Review, 82(12), 73–79

Barrett, P. M, 2012, ‘Apple’s Jihad’, Bloomberg Businessweek, No. 4273, April 2–April 8, 56–63.

Kitching, J. and Blackburn, 2003, ‘Innovation, intellectual property and informality: evidence from a study of small enterprise and some implications for policy’, in Blackburn, R. A. (ed.) Intellectual Property and Innovation Management in Small Firms, London: Routledge, pp. 16–34.

Leiponen, A. and Byma, 2009, ‘If you cannot block, you better run: small firms, cooperative innovation, and appropriation strategies’, Research Policy, 38(9), 1478–1488.

Lu, L, 2007, ‘Protecting intellectual property rights: how three Taiwanese IT firms protect their IP in mainland China’, Research Technology Management, 50(2), 51–56.

Mansfield, 1985, ‘How rapidly does new industrial technology leak out?’, Journal of Industrial Economics, 34(2), 217–223.

Tang, 2003, ‘Management of intellectual property by electronic publishers’, in Blackburn, R. A. (ed), Intellectual Property and Innovation Management in Small Firms, Routledge, London, pp. 85–104.

Thomas, S, 2003, ‘Intellectual property in biotechnology firms’, in Robert A. Blackburn (ed), Intellectual Property and Innovation Management in Small Firms, Routledge, London, pp. 69–84.

Von Hippel, E, 2005, Democratizing Innovation, Cambridge, MA: MIT Press. HYPERLINK “https://www.youtube.com/watch?v=tB3OROLi9IM&feature=results_main&playnext=1” https://www.youtube.com/watch?v=tB3OROLi9IM&feature=results_main&playnext=1&list=PL66B81FFA54D5E80B http://www.bloomberg.com/video