Patenteering

Patenteering is a term used to describe the practice of acquiring and holding patents with the primary intention of licensing them to other companies for revenue, rather than manufacturing products based on the patent themselves. This business model often involves identifying existing technologies or developing novel ones that have clear commercial potential. Patenteers then secure patent protection for these inventions.

The core strategy of patenteering revolves around the intellectual property itself. Once a patent is granted, the patenteer can negotiate licensing agreements with companies that could benefit from using the patented technology in their own products or services. These agreements typically involve royalty payments, upfront fees, or a combination of both. This allows patenteers to generate income from their inventions without the significant capital investment and operational complexities associated with manufacturing, marketing, and sales.

While patenteering can be a legitimate and profitable business strategy, it can also be associated with non-practicing entities (NPEs), sometimes referred to as patent trolls. This term is often used pejoratively to describe companies or individuals who acquire patents solely to sue others for infringement, rather than to promote innovation or bring new products to market. The activities of patenteers, particularly NPEs, are a subject of ongoing debate regarding their impact on innovation and competition.