Gamasutra:
Video games are big business. In 2005, the world wide market for video games was estimated at $28 billion, and is expected to grow to $46.5 billion by 2010. And the video game market is still growing fast; the latest estimates show an 11.4% compound annual growth rate.
Nonetheless, while video game developers have become more aggressive about obtaining patent protection for innovations, the video game industry still lags other comparable industries in the number of issued patents.
For example, recent estimates show that various network providers will spend $41 billion on telecommunications equipment for 2007, which is less than a 2% increase from the previous year.
An informal search of issued patents with the word ‘telecommunications’ shows 56,442 entries. By comparison, there are only 6,662 issued patents with the phrase ‘video game.’
Nonetheless, the pace of patent filings by video game developers is on the rise, and, more importantly, lawsuits involving video game patents are also on the rise. One need look no further than the recently settled ‘force feedback’ suit, in which Immersion managed to extract over $110 million from Sony.
Of course, filing patent applications for every invention, regardless how minor, that a development group conceives is not sound strategy. Like any other business decision, the costs of obtaining a patent must be weighed against the expected value a patent will provide.
The costs of obtaining a patent include filing fees, other patent office fees, attorney or agent fees, and the time the inventor spends working on the patent application when he or she could have been writing code, designing games, or attending to other duties.
For purposes of this article, the costs of obtaining a patent in the United States can be estimated at $10,000 to $20,000, depending on the complexity of the underlying invention, and not accounting for the inventor’s time. Weighed against these costs are the benefits provided by patent protection. Estimating the benefits of patent protection is a more involved process, which is explored here.
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