America Invents Act: Ensuring U.S. Tech Leadership for the Future

by Semiconductor Industry Association

Remember the “brick” phone of the 1980’s? Launched in 1984, it weighed over 2lbs., held 30 minutes of talk time and cost $4,000. Fast forward to 2011 where your iPhone weighs just 4.8 ounces, can carry up to 32 GB of memory, sustain 14 hours of talk time, act as a computer in your hand and costs as little as $200. In just over two decades the technology industry has been able to dramatically increase the power and utilization of mobile devices while significantly lowering the costs.

What’s the secret? How can technology companies innovate fast enough to make these rapid advancements in such a relatively short time? Part of the answer is in the strength of the U.S. patent system.

An effective patent system is the cornerstone of IP protections, which are vital to the pace of innovation, and innovation is the cornerstone of the semiconductor industry which is  the cornerstone of technology leadership in the United States. It’s all interconnected.

Therefore, it should come as no surprise that semiconductor manufacturers and designers are the U.S. Patent & Trademark Office’s (USPTO) biggest customer.

In fact, 7 of the top 14 U.S. corporate patent recipients are major semiconductor producers; no other single industry can claim as many patents as the semiconductor industry. Even globally, semiconductor designers and manufacturers represent 45 percent of U.S. patents granted to the top 60 patent recipients.

Given the semiconductor industry’s significant contributions to the rapid innovation of the U.S. tech industry we are happy to see that today President Obama has signed the America Invents Act, which is the first major reform of the U.S. patent system in 60 years.

The bill modifies the patent system in several key ways.  First, and perhaps most significantly, it changes the existing “first to invent” system of securing a patent to a “first to file” system. Second, it modifies the patent review process and creates a new administrative process for challenging the issuance of a patent.  Finally, it modifies the patent fee system, which according to Acting Secretary of Commerce Rebecca Blank, “will allow USPTO to set its own fees to recover the actual costs of the services it provides, and keep and reserve those fees exclusively for the USPTO’s use—a major part of ensuring that the agency has sufficient funding. This change will also enable USPTO to hire more examiners and bring its IT system into the 21st century so it can process applications more quickly and produce higher quality patents that are less likely to be subject to a court challenge.”  You can read the Acting Secretary’s comments about the America Invents Act, here.

The patent system is a key part of what fuels the rapid pace of innovation that has maintained America’s the global leadership position in semiconductor manufacturing and design for the last 60 years. These new reforms will aide the USPTO in working with industry to ensure that the U.S. tech sector remains the global leader for the next 60 years. We applaud Members of both the House and Senate and the President for reaching this goal today.