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Economics of patent pools

September 2007

Economic Focus

Article written with Yann Ménière.

Patent pools aim at granting a single license for a package of patents belonging to different owners. Since the late 1990’s, they have been used for licensing technology standards such as the Digital Versatil Disc, the MPEG video compression format or the 3G telecommunications norms – an evolution that has fuelled both antitrust debates and research in economics.

This note provides a state of art summary of the economic literature on this question. It presents successively the pro-competitive effects of patent pools; their potential anticompetitive effects and how to prevent them; and the problems related to the formation of patent pools when patent owners have vested interests.  

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