Patent trolls are stifling innovation

Posted on Thursday, June 12 2014 @ 11:46 CEST by Thomas De Maesschalck
A study by MIT's Sloan School of Business claims patent trolls are having a very negative effect on startups. Catherine Tucker, professor of marketing, explains that over the last five years, heavy patent ligitation scared off nearly $22 billion in venture capital funding.
The study defines "frequent litigators" as companies that file 20 or more patent lawsuits, which limits the definition to true-blue "patent trolls," or Patent Assertion Entities (PAEs), the term used by the paper. The study covers the period from 1995 to 2012.

Tucker's paper estimates a 95 percent confidence interval for the amount of lost investment to be between $8.1 billion and $41.8 billion. Those numbers are relative to a baseline of just under $131 billion of investment that actually occurred during that five-year period time.
Full details at ARS Technica.




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