In an extraordinary move, the famous electric car maker Tesla Motors just did the unthinkable…at least unthinkable to most other organizations: it has announced that the company will no longer defend its patents, and in so doing it has effectively converted its very valuable intellectual property into open source.
The June 12 announcement by Tesla’s founder, Elon Musk, on the Tesla blog titled, rather wittily titled All Our Patent Are Belong To You, begins:
Yesterday, there was a wall of Tesla patents in the lobby of our Palo Alto headquarters. That is no longer the case. They have been removed, in the spirit of the open source movement, for the advancement of electric vehicle technology.
Musk explained that the company had originally thought that patenting their technologies would stop the big auto makers from duplicating Tesla’s designs and then wiping them out through the economies of scale that the likes for Ford and GM could bring to bear. The reality has turned out to be quite different:
…electric car programs (or programs for any vehicle that doesn’t burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1% of their total vehicle sales. / At best, the large automakers are producing electric cars with limited range in limited volume. Some produce no zero emission cars at all.…Our true competition is not the small trickle of non-Tesla electric cars being produced, but rather the enormous flood of gasoline cars pouring out of the world’s factories every day.
Tesla contends that “the world would all benefit from a common, rapidly-evolving technology platform” and given that the patent portfolio covers key aspects that make electric cars practical the vision and their initiative could make a significant difference to the availability and acceptance of electric vehicles.
Interestingly, as of this writing, the market doesn’t see Tesla’s move as negative and, in fact, their share price (TSLA) is trading 1% higher than the previous day’s close.
I think we should applaud Musk and Tesla for being so ambitious and doing what was unthinkable.