Preempting the patent trolls

The Lee Myung-bak administration has announced a plan to create a 500 billion won ($424 million) patent fund to ward off patent trolls from foreign countries. The administration has also decided to establish a council on national intellectual property to monitor the policies governing the issue. Although belated, it is still good to hear that such plans were initiated.

Intellectual Ventures, created by the U.S. companies Microsoft and Intel, has a patent fund of more than 5 trillion won. The company reportedly pressured Samsung and LG to make astronomical royalty payments. It is financial and psychological pressures like these that are causing Korean companies to suffer.

The global patent war began a long time ago. And yet, there are still many academics and researchers in Korea with no basic knowledge about how patents work, such as the fact that it is impossible to file for a patent if a paper or research report was published more than six months ago.

Another problem is that although the country has a patent court, litigation on patent cases was actually divided into civil and criminal suits, with district courts in charge of the cases.

A bill to end such antiquated practices pending at the National Assembly has been set aside as lawmakers continue their political row.

Meanwhile, foreign patent trolls are touring Korea’s universities and research institutions to pre-harvest new technologies. These new technologies, developed with tax money, could fill the foreign companies’ coffers only to become threats to Korean companies later on.

Expectations for the new intellectual properties management company are high, and the hope is that it will become a strong weapon in the global patent war.

Japan recently launched an investment company, the Innovation Network Corp. of Japan, with a 13 trillion won fund and a mission to facilitate the commercialization of high technology. It could be a good model for Korea.

To continue the fight against the patent trolls, Korea must avoid becoming mired in bureaucracy. Sitting at a desk and pushing paper around will never make us competitive. The government, universities and companies must cooperate and search for technologies with potential. Advanced technologies and patents must be regarded as Korea’s new growth engines, starting now.

While labor and capital were the most important elements in the industrialized society of the 20th century, having a knowledge-based economy will be the key to success in the 21st century. The world is striving to make the transformation to a knowledge-based economy, and we must keep up, or risk losing our footing altogether.