Innovation = Jobs | Citizens Against Government Waste

Innovation = Jobs

The WasteWatcher

Innovation creates jobs.

That is the central premise of Jay Walker’s keynote address, “Making Innovation Work for America and Americans,” at the first meeting of the IP Dealmakers Forum on November 6, 2014. The forum linked investors together with intellectual property (IP) information and opportunities.

Walker’s speech is particularly timely given the release on November 17, 2014, of a new book from Citizens Against Government Waste (CAGW), “Intellectual Property: Making it Personal;” the November 18, 2014 Global IP Summit hosted by the U.S. Chamber of Commerce’s Global Intellectual Property Center; and the November 12, 2014 report by Economists Incorporated, “Unlocking Patents: Costs of Failure, Benefits of Success.”

As the holder of more than 700 issued and pending U.S. and international patents and ranking as the world’s 11th most patented inventor, Walker has almost unparalleled credibility on the subject of intellectual property (IP). On top of his impressive array of patents, he is the Executive Chairman of Patent Properties, chairman and curator of TEDMED, and the founder of three companies that each serve more than 50 million customers, including Priceline.

Walker began his speech by asking how a job is created in the U.S. or any other country. After discussing and rebuffing the idea that companies or (especially) governments create jobs, Walker said that jobs are created when customers purchase a service or product. In order to get more customers, it is essential to have inventors, who “improve products and services in a way that has market value.” As Walker said, “you create customers by delivering something that a customer wants more than the money they have.”

Walker noted that America’s “competitive advantage is primarily our ability to innovate,” and that most other countries do not reward success. Nonetheless, the use of IP, particularly patents, could be an even larger part of economic growth if unlicensed patents were made more widely available.

As CAGW noted in its report and Walker stated in his remarks, there are several companies that have created a voluntary and affordable process that would provide greater access to unlicensed patents by bundling them together and selling them at a reasonable price. This system would both provide income to the patent holders that they would not otherwise receive and help patent users solve problems, create improved products, increase sales, and open up new markets.

The Economists Incorporated report estimated that intellectual capital derived from patents and other IP constitutes approximately 55 percent of GDP. Increasing the number of licensed patents by 20 to 40 percent could add as much as $200 billion annually in new growth to the U.S. economy as well as help improve the global economy.

Since the first three patents were approved in 1790, more than 5.1 million patents have been approved by the U.S. government, including a record 302,948 patents in 2013. About 2.3 million patents are “active,” but 95 percent of those patents do not provide any licensing revenue.

It is obvious that very few patents have the same value as the telegraph, phonograph, light bulb, television, transistor, cellphone, and microprocessor. However, with the potential to add $200 billion annually to the U.S. economy, every effort should be made to unlock the value of every patent.

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