Thursday, February 16, 2006

Patent Quality Datapoints

What percentage of patents are granted by the USPTO? Looking at their tables for any given year, the percentage appears to be consistently around 50%, but this is misleading. Most patents don't issue in the same year they are applied for, and the USPTO is laboring under an ever-increasing backlog of applications, meaning that the data has to be analyzed across year boundaries.

Several researchers have tackled the problem, with estimates as high as 97% and as low as 62%, with most now agreeing that about 75% of patent applications are eventually granted.

Does the fact that 3 out of 4 patent applications eventually result in a patent grant surprise you? And what does this acceptance rate say about the USPTO's devotion to not granting bad patents? (Hint: unless you believe that 75% of patent applications are for useful, non-obvious ideas that don't have any invalidating prior art, you might be inclined to conclude that the USPTO is not as devoted to patent quality as they should be).

Another data point you may have heard about: the USPTO just granted its 7-millioneth patent. That's 7 million 20-year idea monopolies, every one of them beneficial to innovation, right? As an aside, it took almost 5 years, from the date of application, for this patent to issue.

One last data point: patent grant rates may have increased by 80% over the past 10 years.

All these numbers seem to indicate one thing: the USPTO needs more incentives to grant fewer, higher-quality patents. And one of the best ways to accomplish that may be to stop letting patent holders fund the patent office.


Anonymous Anonymous said...

The comment about how the Office keeping fees motivates the office to grant more patents is illogical. Examiners have no incentive to grant more patents - just to review more and more patents. In fact, if they are found to have allowed something that is not actually allowable - they get an unsatisfactory performance review and can't get promoted. So where's the motivation?

The USPTO is not a business - it is the only true "monopoly" related to IP. It does not have to worry about budgets and income like a normal business. It charges (taxes) their customers only what it needs to examine patents effectively. When congrss takes a portion of that - quality and speed decrease because they are recieving less than their needed minimum. The reason they don't have enough examiners - see fee diversion.

6:35 AM  
Anonymous Anonymous said...

I think the point was that institutionally the patent office has the wrong incentives, not individually.

It is obvious that the definition of "allowable" at the USPTO is far more generous than that of the general populace. And that's true for virtually any of the criteria that make up what is allowable: obviousness, prior art, usefulness.

The USPTO's definition of non-obviousness is far more generous than the layperson's. The USPTO's definition of prior art is far more narrow than that of objective third parties. The USPTO's definition of 'usefulness' grants patents on "inventions" that aren't workable on a regular basis.

Why does the patent system have this wacked-out view of the world where 'anything under the sun' is patentable? I'm inclined to agree with the poster: its because the entire system has the wrong incentives.

8:02 AM  

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