By Intan Hamdan-Livramento, Economics and Statistics Division, WIPO
This article is derived from the World Intellectual Property Report 2015 – Breakthrough Innovation and Economic Growth
The history of how a heavier-than-air machine took flight is replete with tales of fearless inventors, daredevils and dream chasers. It is also full of stories of meticulous and repetitive experimentation, advanced calculus and reliance on hard science. Government, too, played a decisive role in the airplane’s development, in particular during the two World Wars.
How the airplane came to be is an insightful example of how minor and major technological and scientific advances by notable risk-takers under specific economic conditions resulted in a truly ground-breaking innovation – one that has transformed the way the world works today.
But what part did the patent system play in the evolution of the airplane?
The answer: patenting had a role in the development of this technological marvel in the start-up years when commercial flight became a reality. But it is difficult to assess the extent to which patents alone shaped the evolution of the industry overall, given the critical influence of government intervention in driving advances in aviation in the lead up to the First World War through to the end of the Second World War. While governments continue to support the aerospace industry, their scope of influence is arguably lower than in the first half of the 20th century. Also, in the post-war era, and still today, there is little evidence of critical patents blocking the technological evolution of the airplane.
Tracing the evolution of the airplane reveals three important stages of development: the early years of open collaboration, followed by the emergence of a new industry years and finally the war years. Each of these stages provided a different innovation setting and dynamic among the inventors, the academic institutions, governments and economic environment.
In the early years of aviation, when flying was still a dream, a small but growing community of enthusiasts was driven by the challenge of “how to fly.” Early pioneers like Francis Wenham and Lawrence Hargrave had no expectation of making money from their endeavors, at least in the beginning.
At the time, developments in aviation were predominantly mechanical, and could be imitated relatively easily. That meant that anyone who had an interest in flying and the financial means to do so could belong to the flying community.
Inventors would learn from previous experiments and would adapt or change their airplane designs and test them to see if they worked. Most would report their findings back to the community, and thereby further expand the knowledge base of flying.
These aviation dreamers openly collaborated with each other to ensure that each learned from the other’s experiments. During this period, journals, exhibitions and conferences sprang up to share the latest developments and know-how on flying. Membership-based clubs and societies on aerial navigation formed across the globe in Australia, China, France, Germany, Japan, New Zealand, the Philippines and United Kingdom to name a few.
One person in particular, Frenchman Octave Chanute, facilitated the collaborative nature of this community through the publication of Progress in Flying Machines (1894). His book compiled all known aviation-related experiments and their results. Its publication helped make the knowledge of flight widely available to the public. He also regularly corresponded with fellow inventors, exchanging ideas and thoughts on aviation experiments. Wilbur and Orville Wright were among those who communicated with Chanute.
During the early aviation years, a handful of inventors filed for patents on their flying contraptions. However, their motivation for seeking exclusive patent rights appears to be related to non-monetary reasons – a desire to bolster their reputation or to share their work with the public. Very few were able to profit from their patented inventions. Otto Lilienthal, a renowned German aviation pioneer, sold only seven of his patented gliders to interested buyers.
The collaborative spirit among aviation enthusiasts in the early years of flight started to unravel when flying became a real possibility. The Wright brothers, for example, withdrew from this open community when they realized that their invention could work and had commercial potential.
In 1903, the Wright brothers filed a patent with the United States Patent Office for their wing warping and rudder structure design. It was subsequently granted as US Patent No. 821,393 in 1906. Chanute was dismayed by this move and criticized the brothers for learning from the open community and later refusing to share their knowledge with it. To make matters worse, they had relied on Chanute’s airplane design.
Meanwhile, in Germany, Hugo Junkers was applying the latest understanding of the theory of aerodynamics to airframe construction and came up with a more stable, reliable and efficient aircraft. In 1910, he applied for a patent on that design with the German Patent Office. His seminal work would shape the development of all future airplanes.
During this period, the number of aviation-related patents filed worldwide increased significantly. Inventors from France, Germany, the United Kingdom and the United States were filing patent applications at an unprecedented rate (see Figure 2). Moreover, the number of patent applications filed outside of the inventor’s home country also grew, indicating that they intended to commercialize their inventions beyond their own backyard (see Figure 3).
The rise in patent filings coincided with increased investment in the sector from both private and public sources as investors began to recognize the real potential of air travel. It also coincided with an increase in the number of companies incorporated. Wright brothers (1908), Gabriel Voisin (1910), and Glenn Curtiss (1916) founded their own companies to profit from their efforts. Between 1903 and 1913, approximately 200 airplane prototypes were introduced, but only very few were manufactured. Most of them were sold for government use.
The start-up years also saw greater use of the patent system to appropriate returns to investment; first, to prevent others from free-riding on an innovation; and second, to help companies remain competitive. Both the Wright brothers and Junkers were successful in pursuing litigation against several of their rivals, especially in their domestic markets. Junkers, for example, enforced his patent rights against aircraft manufacturing rivals such as Claude Dornier, Willy Messerschmitt, and Adolf Rohrbach in Germany. For their part, the Wright brothers enforced their rights against Glenn Curtiss and others in the United States. Aviation companies used their patent rights to license out their technologies as a way to generate further revenue streams. Some licensing contracts for aviation technology entailed payments in the millions of dollars.
Important patents held by the Wright brothers in the United States and by Hugo Junkers in Germany came under close scrutiny by their respective governments during the World Wars.
Two factors may explain why. First, the airplane was seen as a strategic weapon – the side that created the better weapon could win the war. Rapid development of these machines therefore became a top priority. Second, the differences among the firms involved in manufacturing airplanes – both within each country and beyond – in terms of their technological superiority meant that the resources for producing the best airplanes were concentrated in the hands of a select few. This had to change as the demands of war required rapid production and deployment of thousands of warplanes.
In the United States, some argued that the broad scope of the patent rights granted to the Wright brothers had stunted airplane development in the country. The use of European-designed airplanes by the United States Government in the First World War suggests this was the case. To remedy the situation, in 1917, the United States Government established the Manufacturers’ Aircraft Association (MAA), a trade association that actively encouraged its members to cross-license their airplane technologies through a patent pool in support of the country’s war effort. In Germany, similar developments ensued. Also in 1917, the Association of German Aircraft Producers was established to pool all important airplane patents from different national inventors. However, the association did not work as intended because Junkers was reluctant to share his patents with other aircraft producers. By the Second World War, however, Junkers had been forced to contribute his patents to the association by the Nazi Government.
The significant investment made by governments on both sides of the war to ramp up warplane production provided a major boost to airplane development. Inventors like Junkers, Dornier, and Messerschmidt were forced to collaborate to produce the best German designed warplanes. In the United States, funding was made available to establish public research organizations, such as the National Advisory Community of Aeronautics (NACA). In Germany, similar organizations compiled the latest aviation developments and disseminated them through publications such as the Technische Berichte der Flugzeugmeisterei. All these efforts sought to speed up the progress of aviation researchers and manufacturers.
The role played by the patent system has evolved in response to the changing political, economic and technological realities that have shaped airplane development over the years.
By the end of the Second World War, the airplane innovation ecosystem experienced another shift in its dynamics which, to a large extent, continues today. Several things changed. First, in stark contrast to the start-up years, the ecosystem now has significant government presence, although arguably to a lesser degree than during the War. Second, the industry underwent considerable consolidation, with two main global competitors, Boeing and Airbus, emerging to dominate global aviation. Third, while the number of patent filings for aviation-related technologies took off again (although it has yet to reach the total number of patent applications filed during the start-up years), airplane manufacturers began to rely on other methods to appropriate returns on their investments.
Over time, as airplanes have become more complex, so too has the industry’s innovation ecosystem. Supply chains have become ever more intricate, requiring greater focus on coordinating the integration of many different technologies in an optimal and cost-efficient manner. This involves close collaboration with a range of technology providers who are generally required to sign long-term exclusive contracts underpinned by the airplane manufacturer’s specifications and standards. That explains why, post-1945, the sheer complexity and specialist nature of the technologies employed – meaning they cannot be copied easily – has been sufficient to enable airplane manufacturers to appropriate most, if not all, of their investment in innovation.
The role played by the patent system has evolved in response to the changing political, economic and technological realities that have shaped airplane development over the years. In the early years, few inventors sought patent rights for their inventions and when they did, the reasons for doing so were usually of a non-monetary nature. This can be explained, in part, by the absence of any real world application of the aviation-related inventions developed.
However, as air transport became a realistic proposition, inventors appeared to rely on the patent system to appropriate their returns on investment. Patent owners enforced their rights to maintain their competitiveness and began licensing out their technologies to create new streams of revenue. During the start-up years, the number of aviation-related patents grew, coinciding with the rise in the number of incorporated aviation-related companies.
The state of emergency during the World Wars once again influenced the use of the patent system by airplane manufacturers. Inventors were encouraged to join patent pools as a way to speed up the development and deployment of airplanes. The significant government investment poured into developing warplanes resulted in advances in aviation technologies that have since spilled over to commercial aviation.
Today, the industry appears to be less reliant on the patent system than during the start-up years. This is explained, to a large extent, by the increasingly specialized nature of the airplane innovation system, which is squarely focused on optimizing the integration of complex subsystems of technologies, ranging from new light-weight materials to sophisticated electronics and software systems in the quest for more affordable, eco-friendly and efficient air travel.
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