Editor’s Note: Please excuse my long layoff from posting to this blog. Other work-related matters have made focusing on writing difficult. My latest article appeared in TechCrunch over the weekend, and I think it is very relevant to my audience so I am reblogging here as well.
A recent TechCrunch guest post by Jeffrey Shieh suggests that startups should file for international patent protection for a variety of reasons. Mr. Shieh does a great job of explaining the benefits and options for seeking international patent protection. However, based on my experience working with startups, I disagree with his conclusion that startups should expend precious early funds on international filings.
Filing for patent applications, whether in the U.S. or abroad, is an expensive proposition even for well established companies. I have previously argued here that despite these costs, filing for U.S. patents is worthwhile because U.S. patents provide an additional value proposition to potential acquirers of startups. The costs, however, come at the opportunity cost of critical needs such as engineers and designers. While I stand by my opinion regarding the value of U.S. patents to startups, it is my belief that in most cases, international patent applications cannot be considered in the same light.
Why is foreign filing not worth this expense? Simply put, the costs outweigh the benefits. For most U.S. based companies, U.S. intellectual property rights will provide most of the feasibly attainable economic value. Many startups will also run up against European restrictions on software and business method patents, and not even be able to receive the desired coverage.