Discrete versus Complex

DISRETE TECHNOLOGIES are, by definition, those technologies protected by a single patent (or very small family of patents all owned by the same entity. In general, pharmaceuticals, chemicals, and certain manufactured goods fall into the category of discrete technology. Discrete technologies are characterized by:

1. a one to one (or very few to one) correspondence between the patent and the product.

2. all of the patents are owned by one company; there is no need for design freedom or litigation avoidance.

3. a single patenting objective ­ near term competitive protection: block substitutes, profit will be realized through product sales; cross-licensing is not an objective.

4. a straightforward patenting strategy: create a “thicket” of patents so that no one can make, use, or sell the product, or any suitable replacement of the product, without infringing the company’s patent or incurring prohibitive costs.

5. a clear strategy for licensing/enforcement strategy: aggressively pursue infringers.

6. relative ease in determining the value of the patent, or group of patents.

Because near term competitive protection is essentially the only corporate objective, the patenting strategy is to obtain patents on inventions which the company uses in its own products. In this situation, the Invention Strategy produces a portfolio of patents well-suited to the business needs of the company.

COMPLEX TECHNOLOGIES present an entirely different challenge. In complex technologies, like wireless communications, computers and software, which involve the integration of many different technologies covered by many patents which are owned by many companies (competitors and interlopers alike) near term competitive protection is far less of a priority than litigation avoidance or design freedom. COMPLEX TECHNOLGIES are characterized by:

1. a many-to-one correspondence between the patent and the product.

2. patents essential to the product are owned not only the company itself, but by others as well.

3. patenting objectives are many and difficult to rank: design freedom and avoidance of litigation are often primary objectives.

4. a patenting strategy which is not obvious and difficult to formulate or articulate in simple terms.

5. a licensing/enforcement strategy is unclear; there will most likely be a mix.

6. immense difficulty in determining the unbundled value of any particular patent or group of patents.

In complex technologies, companies must form alliances, work together in standardization fora, cooperate to produce products with assured interoperability, gain access to other’s technology, and make their own technology available to others in a controlled manner; all the while gaining and maintaining competitive advantages wherever possible. 

A strategy of obtaining patents on inventions that arise from R&D will not produce the diversity of patents needed, nor will it satisfy even the main business objectives.