Tesla Motors Inc Officially Opens Patents To All

Tesla Motors Inc Officially Opens Patents To All
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Tesla Motors Inc (NASDAQ:TSLA) said today in a blog post on its website that it has removed all of the patents from the lobby of its headquarters in Palo Alto, Calif. The automaker said it is following “the spirit of the open source movement” and allowing anyone to use its patents “for the advancement of electric vehicle technology.” Musk has been hinting at this move since earlier this month.

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Tesla follows the Android approach

In other words, Tesla Motors Inc (NASDAQ:TSLA) is following the Google Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) approach to technology through open source. This certainly makes Tesla’s culture quite the opposite of Apple Inc. (NASDAQ:AAPL)—which everyone loves to compare it to—as Apple prefers to sue everyone under the sun for patent infringement.

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In the blog post, Tesla Motors Inc (NASDAQ:TSLA) CEO Elon Musk said they started the automaker “to accelerate the advent of sustainable transport.” He essentially said that it doesn’t make sense to forge ahead and create “compelling electric vehicles” but then put “intellectual property landmines” along the path behind them to keep others from succeeding in the electric vehicle space. He said such behavior would be the opposite of their original goal of speeding up the adoption of sustainable transportation.

Musk added that Tesla Motors Inc (NASDAQ:TSLA) will not sue anyone who “in good faith” wants to use the technology they created.

Musk’s view of patents has changed

The Tesla Motors Inc (NASDAQ:TSLA) CEO said he once thought patents were great. When he founded Zip2, he strived hard to get patents. Elon Musk said perhaps in those days, patents were a good thing but that today, they only seem to be a barrier to progress. He said they also seem to make lawyers rich instead of the inventors who came up with the technologies and keep huge corporations in a dominant position. After he left Zip2, he said he came to believe that “receiving a patent really just meant that you bought a lottery ticket to a lawsuit.” As a result he avoided filing for patents “whenever possible.”

In spite of this view though, Musk and the rest of Tesla Motors Inc (NASDAQ:TSLA)’s management felt like they should secure patents because of threats from the big automakers. They believed that the already-established automakers would use their huge resources in manufacturing, sales and marketing to overwhelm their new company.

Tesla looks at the big picture

However, Musk said they were very wrong and that the big automakers have ignored electric vehicle technology almost entirely. He notes that less than 1% of major automakers’ sales are of zero-emissions vehicles. He also notes that major automakers are “producing electric cars with limited range in limited volume” and that some of them don’t even make any zero-emissions cars at all.

Instead of being concerned purely about Tesla Motors Inc (NASDAQ:TSLA)’s future, Musk said they became concerned about our planet. He said every year, nearly 100 million new vehicles are produced. Globally, there are about 2 billion cars on the road. As a result, he said it’s impossible for Tesla to make electric cars quickly enough to tackle the “carbon crisis.” He also noted that these massive numbers mean the market is huge.

“Our true competition is not the small trickle of non-Tesla electric cars being produced, but rather the enormous flood of gasoline cars pouring out of the world’s factories every day,” the blog post reads.

He added that patents don’t define leadership in technology, as historically, they provide very little protection against competition. Instead, he said technology leadership is defined by a company’s ability “to attract and motivate the world’s most talented engineers.” Musk believes that by turning to open source philosophy, Tesla Motors Inc (NASDAQ:TSLA)’s position in the car industry will be strengthened rather than diminished.

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Michelle Jones is editor-in-chief for ValueWalk.com and has been with the site since 2012. Previously, she was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Email her at Mjones@valuewalk.com.
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  1. Know when to fold them.
    Delayed X, and a Model S that most Americans can not afford.
    Recent insider selling now seems the obvious thing to do.
    Tesla Motors Inc. will most likely slowly drift to true valuation.
    $45 on Tesla Motors, Inc.
    Reno, NV Know when to run.

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