Intellectual Ventures, the patent holding firm and invention house founded by former Microsoft technology chief Nathan Myhrvold, was already-well known in technology circles. But the Bellevue-based company has been thrust into the national spotlight this weekend — and not in a good way — as the central subject of an entire hour of the popular public radio program, “This American Life.”
As we noted yesterday, the piece dives deep into the complex underworld of the technology patent business, and quotes Silicon Valley venture capitalist Chris Sacca comparing Intellectual Ventures’ patent licensing operations to “a mafia-style shakedown.” In the story, Intellectual Ventures executive Peter Detkin calls that assertion “ridiculous and offensive.”
Intellectual Ventures must have known in advance that the piece wouldn’t be a glowing tribute to its work. But what does the company have to say now that it has aired? GeekWire reached out to the company for comment and received this response a short time ago.
The recent story on NPR had a specific point of view on the impact patents have on innovation – one that we fundamentally disagree with. Some of their characterizations of patents in general and of IV specifically were colorful and dramatic, and some were just absurd. Sadly, they distracted listeners from the real issue – that ideas have value and inventors who invest time, money and emotional resources into protecting those ideas with patents have a right to recognize a return on their investments.
Intellectual Ventures is challenging the status quo, but we think this disruption is important in order for the marketplace around ideas to mature. Our value proposition is simple: we want to provide an efficient way for patent holders to get paid for the inventions they own, and in turn, for technology companies to gain easy access to the invention rights they need or may need as they enter new markets.
For years, the importance of respecting invention rights has been ignored or swept under the rug. Many of the world’s leading technology companies are beginning to recognize that patents are a strategic asset worth billions of dollars. This evolution in perspective is notable and we are proud to have contributed to this new way of viewing invention rights.
With so much change happening, there is bound to be controversy. We often find ourselves at the center of that controversy, but that only strengthens our commitment to building an efficient invention capital market.
To me, the most interesting part of the story is the detail about IV negotiating a cut of future licensing revenues when it sells a patent — giving it the ability to benefit financially from patent litigation, even as it distances itself from the actions of the acquiring firm.
Intellectual Ventures has recently filed some patent litigation of its own, but doing so comes with inherent risks, such as the company being forced to disclose its major investors.
Speaking of those Intellectual Ventures investors, as noted by Business Insider’s Matt Rosoff today, that’s one subject the This American Life story didn’t delve into. As outlined in this legal disclosure by Intellectual Ventures, they include a who’s who of tech companies — among them Microsoft, Cisco, Apple, Adobe, Google, Nokia, SAP, Sony and Yahoo.
Post updated to correct This American Life’s affiliation. The show is distributed by Public Radio International. Alex Blumberg of NPR’s Planet Money and NPR’s Laura Sydell co-reported the piece on patents for the show. Thanks to the reader below who pointed out our mistake.