Tesla’s Open Patent Portfolio Seen As “Largely A PR Move” With “Little To No Significant Impact”

JUL 14 2014 BY ERIC LOVEDAY 25

Tesla Patents

Tesla Patents

“If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property land mines behind us to inhibit others, we are acting in a manner contrary to that goal.”

States Tesla Motors CEO Elon Musk in opening Tesla patents to the rest of the world.

Despite those patents now being open, Tesla has not seen any takers.

That’s no surprise, according to Jay Whitacre, a materials scientist at Carnegie Mellon University.

As Whitacre claims:

“It is the economics and necessary scale of production that will keep competitors at bay, not fear of patent lawsuits.  While I do think it is a nice gesture by Tesla to open its patent portfolio, it seems to be largely a PR move and should have little to no significant impact on their competitive stance.”

Whitacre is referencing the Tesla gigafactory here when he states “economics and necessary scale of production that will keep competitors at bay.”

Surely this doesn’t make complete sense, as Tesla has more to offer than just battery technology.  However, the overwhelming majority of analysts, journalists, etc. seem to agree that Tesla’s open patent announcement will, by and large, have no noticeable impact on electric vehicle development.

Tesla Patent Wall As It Is Today!

Tesla Patent Wall As It Is Today!

Catherine Tucker, associate professor of marketing at Massachusetts Institute of Technology, disagrees, stating:

“Aggressive patent litigation is ultimately detrimental to the ability of an entire industry to develop new technologies. Tesla’s position might also support creation of an industry standard.”

Daimler’s Koert Groeneveld offers a different take:

“Tesla’s proposal is an interesting idea. However, we think standardisation should not be defined by one manufacturer, but in a joint effort between manufacturers, politicians and energy distributors.”

Regardless of which side of the fence you’re on, Tesla’s move to open up its patent portfolio should be viewed as a positive.  Whether or not Tesla’s decision advances electric vehicle development/technology remains to be seen.

Source: RSC

Categories: Tesla

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25 Comments on "Tesla’s Open Patent Portfolio Seen As “Largely A PR Move” With “Little To No Significant Impact”"

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“we think standardization should not be defined by one manufacturer, but in a joint effort between manufacturers, politicians and energy distributors.”
———-

How about we leave the politicians out of it.

pjwood

CCS, with a nod and a wink. No, no, keep the politicians involved. What better to keep it from happening?

Energy pro’s know how heavily regulated electricity is, how little room for margin there is, how much actual fuel competition there is. The last thing the “energy distributors” were working on was yet another way to distract ordinary people from realizing how insanely marked up natural gas, at the pump, is.

http://www.greencarreports.com/news/1093185_natural-gas-vehicle-makers-propose-new-unit-diesel-gallon-equivalent

James

Agree with Kdawg.

Exactly.

no comment

automobiles are regulated products, so of course “politicians” do have something to do with it. you might be surprised to find that there are a lot of technology areas that involve “politicians”.

“Tesla’s proposal is an interesting idea. However, we think standardisation should not be defined by one manufacturer, but in a joint effort between manufacturers, politicians and energy distributors.”

Ok, now I understand why the “standards” never seem to get completed, compromised on design optimization, and end up being more than one anyway.

Rick

Politicians should have no involvement in setting the standard, that should be established by the industry. But then once the standard is agreed upon by the majority of the manufacturers, then it can be enforced by the politicians. Don’t presume they have no tools to bring to the game.

Joshua Burstyn

Good point. Industry developed and deployed, government enforced thereafter.

Spec9

I concur.

no comment

to add to this observation, it is also the case that existing statutes and regulations can set boundaries that can limit the course of development for technical standards. in that case, the technological development either works within those established boundaries, or efforts can be made to get the statutes and regulations modified.

James

Note to Eric.

I’d rework the title to this article. It comes of as inflammatory and universal. Rather, it should read ” – By Some”. In this piece you share a quote by one person, Whitacre, a materials scientist at one university. Then you offer an opposite view from a professor at MIT.

Of course, the title of the article contains quotation marks – but when I read this on my smartphone, it basically looks like a statement, not an opinion by some – or even a majority of market analysts, as you state.

So basically, the title comes off as a statement that Tesla’s patent Open Patent Portfolio is a PR move. NOT that this is
someone, or even a minority or majority of industry analyst’s views.

Again – I’d change the title to better fit the content of the piece.

James

To be absolutely accurate, you do quote another contrarian opinion by someone ( it does not state the position he holds ) at Daimler – which is natural for competitors to balk at letting an upstart competitor shape the playing field in any way.

But again, that is two shared negative opinions on Tesla’s open-patent policy announcement, and one positive. Not refecting the title, which sounds as if it’s a given that Tesla’s actions are a big PR move.

It’s detail, but this really sounds as if it’s a shot at Tesla.

TomArt

“click”

They do not understand what Tesla is offering. By using the Tesla patents, you do not end up with a Tesla clone. So, the “standardization” thing is off-base. It sounds like a subtle way to spread FUD.

Another piece may well be a “not invented here” reaction.

vdiv

The engineers in the back room have certainly paid attention to what Tesla has been doing and now have less restriction to “borrow” these inventions. The big automakers may be stubborn, slow, and moronic, but for a small EV startup the Tesla portfolio may be rather useful. I would rather hope that Tesla is not the only EV maker that succeeds in our lifetime. Otherwise we are screwed.

Spec9

Actually, it is not totally off base. If they were to design battery packs that use the same 18650 form factor batteries or battery packs that can be removed & replaced just like Tesla’s pack, there could be some standardization that goes on which grows mass manufacturing scale and/or charging/battery swapping infrastructure.

But various automotive standards should be hashed out through the various engineering societies and automotive groups.

Spec9

Why would anyone listen to a materials science professor on an EV patent issue? Should we consult an orchestra conductor too?

Rav4 EV

Hahaha. Nice one.

I would like my Rav 4 EV to have a tesla port so I could use the Tesla quick charge network as well as the Chademo, J1772 and all of their other future adapters (frankenplug etc).

Whitacre’s comment as highlighted above doesn’t even pass the first level of thoughtful review.

> economics and necessary scale of production that will keep competitors at bay.

Which of Tesla’s competitors do not have greater scale of manufacturing capability and deeper pockets?

Really pathetic premise.

The companies that actually make use of these “open” patents are much more likely to be smaller startups than well funded, highly entrenched legacy automakers.

no comment

Whitacre was not saying that *Tesla* had scale; he was making a general observation. his comments on patents is true for the vast majority of patents, so it is a reasonable statement of generality. however, without actually seeing Tesla patents, he can’t speak to the value of Tesla’s patents. i do agree that there is a significant aspect of PR in this, because you don’t know how “open” the Tesla patents are until you see the fine print. i do, however, suspect that Tesla is trying to use the standards model when it comes to licensing of Tesla patents; and i have little doubt that any use of Tesla patents will be licensed. unless Tesla renounces it’s patent rights, a company would be absolutely foolish to attempt to use Tesla patents, by relying on public statements alone, without getting some kind of licensing deal first.

ffbj

+1 you said it brother, so I don’t have to.

Just_chris
I always enjoy Tesla articles or announcements. I always find my self wondering why they have done or said what they have. The headline is never the full story and the reasoning behind what they are doing is never clear and to my mind never actually given by Tesla. Did Elon wake up one morning and decide he desperately wants to help VW and Toyota catch up? Really? Oh that’s right, hes doing it for “the good of humanity”. So why is he not just letting the patents lapse? It would be far cheaper than maintaining 250+ active patents. He is not knocking down the wall he is just moving it, the question is where to and for what reason. Is this a preemptive strike against the EU who were looking at ways of block the SC charge network because it can only be used with Tesla’s? Is it a way of preserving the government tax incentives of EV’s? not sure how it does that but there is plenty money there to motivate behavior that would not be considered normal business practice. Is this a move to try and push some bigger players into making longer range SC compatible EV’s… Read more »
TomArt

Actually, it’s very straight-forward. SCs are unmatched in the industry. Everyone else’s products are mediocre, half-hearted or otherwise knuckle-dragging. Even BMW, which launched its own brand for plug-ins, hasn’t provided what Tesla can.

The power that the SCs can deliver, the small, compact efficient plug, etc., are simply and unequivocally superior in every way. Opening up patents to development on this tech alone is very compelling.

The reasons why the industry hasn’t jumped on Tesla’s offer yet are twofold:

1) nobody’s battery packs are large enough to take that kind of charge; and

2) hey, it’s the auto industry, and they aren’t doing the smart thing…what’s new?

Kubel

Politicians? Really? Who can honestly say that with a straight face? If politicians are involved in a standard, it’s already doomed to be inferior. It’s like watching the world series knowing it’s been rigged. The best technology won’t win, only the one that’s sponsoring the most liars, thieves, and conmen (also known as politicians).

Evil Attorney

This leaves out an important initial question: are Tesla’s patents broad enough in their protection to be meaningfully valuable to another car company. Looking at how very narrow their patents claims are and the limited number of prior art references reviewed by the patent examiners, I am skeptical that there would be much value, if any, here (i.e., it would be very easy to make small changes to design around the patents).

The main value will come from not needing to pay outside counsel to draft noninfringement/invalidity opinions for any of Tesla’s patents. That’s a drop in the bucket compared to overall car development costs.

TomArt

“(i.e., it would be very easy to make small changes to design around the patents). ”

Easier said than done. It all depends on what is novel – what’s special about the particular innovation that puts the invention head and shoulders above what everyone else is up to. Some of those patents may be special and have great market value, some might not be.