Patents and Competition


Why is it that for every product there is competition? Isn't the patent meant to cancel competition?

No, patents are not meant to cancel any competition. Patents are meant to channel competition into new innovations instead of copying old ones.

Competition exists wherever alternatives exist. Competition is simply the comparison of different alternatives. Different products can address the same need in different ways. Let us clarify the ideal role of patents in this process:

  1. Most products are not protected by any patents. Most products or solutions to problems do not involve any new inventions as such. Different variations in a solution to a problem, like different recipes for a chocolate cake, cannot be patented. I built an INC. 500 software company without filing for a single patent in over fifteen years.
  2. As the world grows richer in alternatives (that is, more competitive), there are more alternative resources to address the same problem. Patents are original inventions, that is, unique ways of solving a problem with enough novelty to call them “new”. However, a different solution to the same problem does not violate a patent. By their nature, patents must be specific. New alternatives can be inspired by a patent without violating it.
  3. Patents rarely create a monopoly, that is, create one, best solution with no alternatives. They were never meant to. By protecting original inventions, others are forced to offer creative alternatives rather than simply copying the work of others. This protects the original creator from intellectual theft and inspires new creators, who in turn are also protected.