Uber has announced that it is establishing a patent buying programme modelled on similar initiatives recently launched by Google and a consortium led by defensive aggregator Allied Security Trust (AST).
The Uber Patent Purchase Promotion (UP3) will closely follow the formats of its predecessors, Google’s Patent Purchase Promotion (PPP) and the AST-led Industry Patent Purchase Promotion (IP3). Prospective sellers will have a limited timeframe in which to submit their patent packages – as well as asking prices – to Uber for consideration. The transport mega-start-up will then review the submissions after the deadline date, and if it is happy to pay the suggested price for a package, will contact the vendors to seal the deal – all within a matter of months.
Kurt Brasch, Uber’s senior manager for patents, is taking the lead on UP3. He had previously masterminded Google’s PPP when he was senior patent licensing manager at the company. “The current market for patents is extremely challenging, especially for sellers,” Brasch wrote in a blog post. “There is a ton of friction in the secondary market for all parties, but with our new UP3 program, sellers will submit patent family details and a price they are willing to accept directly into our submission portal. By eliminating price negotiations and providing quick reviews, UP3 will reduce the total transaction time compared to a typical patent transaction.”
IP3 – which ran between May 25 and June 10 last year – ended with the buying consortium making 56 offers to acquire 107 active patent filings at an average price per family of $96,000. The total spend was over $5.3 million, with individual purchase prices ranging from $10,000 to $325,000.
One significant difference between UP3 and its forerunners is that would-be sellers, who under the earlier programmes had been limited to submitting single patent families for consideration, will now be able to offer packages consisting of up to five families. “That way, sellers can group patent families that complement each other in a way that best markets their assets,” writes Brasch.
Something else that sets UP3 apart from PPP and IP3 is the motivation behind it. The earlier schemes had mainly been devised as a way of taking potentially problematic assets off the market, thereby keeping them out of the hands of NPEs or other parties likely to assert them. UP3 is more directed towards beefing-up Uber’s relatively meagre patent portfolio, as the company continues to undergo rapid growth, plan new service offerings and – perhaps – prepare for IPO. “Uber is officially in the market for patents,” Brasch writes. “Since Uber was founded, we’ve grown from a single product – black cars, at the push of a button – to everything from on-demand carpooling to food delivery. To build the next generation of Uber services, we’re looking for patents to support our expanding business.”
Brasch expanded on this in comments to IAM, saying: “Obviously we’re trying to grow our portfolio organically, but also by being strategic about some of our acquisition targets. We participated last year in IP3 and really saw the benefits of it in terms of the speed of the transactions and simplicity of negotiations.”
Prospective sellers can submit their packages to UP3 for consideration between April 24 and May 23. Uber will inform sellers as to whether or not it has decided to purchase their packages by July 7, with contracts anticipated to be finalised and signed by the end of August.