In an article in the Wall Street Journal today, Reuven Brenner cites recent cases involving Apple/Samsung, Novartis and Myriad to ask: "Must All Patents Last For 20 Years?" (you will need a subscription or free trial to read it in full). He quotes comments made by Amazon.com founder Jeff Bezos, suggesting that an appropriate term for software patents would be three to five years. There is also an online campaign for a five-year term for software patents.
I think Brenner is right to note that different lengths of protection are appropriate for different industries. Indeed, many jurisdictions do provide shorter terms of protection for certain inventions for example in the form of utility models (which typically last up to about 10 years) or the Australian innovation patent (eight years).
But I think those who criticise the 20-year patent term overlook the fact that patents last for up to 20 years. Many – if not most – granted patents are in fact abandoned long before the 20-year term is up, due to a combination of the costs of maintenance and the advance of technology.
Research on the average lifespan of patents is hard to find (which is a pity as you would think information on maintenance would be useful in planning annuity fees, for example for the unitary patent). That's partly because data is historical (the best we could do today would be to look at what happened to patents filed in 1992, 20 years ago) and partly I suspect because the average life of patents is gradually coming down, and patent offices don't particularly want to draw attention to that.
However, we do have Kimberly Moore's 2005 article Worthless Patents (written before she was appointed to the Federal Circuit), which showed that 53.71% of US patents issued in 1991 expired before their full term due to non-payment of maintenance fees (16.04% by 4 years, 21.03% during years 4 to 8 and 16.64% during years 8 to 12). In Europe, where renewal fees have to be paid annually rather than just three times, you might expect average lives to be even shorter. My attention was drawn to an interview with the DPMA's Kirsten Halves, which suggests the average life of German patents granted in 1990 was 12 years 5 months. And WIPO's 2012 World IP Indicators report includes a chart (A9.1.2) indicating the number of patents in force as a percentage of total applications, based on available data. The report states: "Around 18% [of patents eventually granted] lasted the full 20-year patent term."
In other words, the market determines patent lifespan. In industries where technology advances quickly, or patents prove worthless, they are being abandoned. Only where they are commercially important are they kept for the full term – especially in Europe where renewal fees after the 10th year add up to thousands of euros. Common sense suggests that pharmaceutical patents protecting blockbuster drugs may well be maintained for 20 years (or longer where extensions are available) but patents for software inventions that quickly become obsolete are abandoned much sooner.
Brenner suggests that lawyers, accountants and consultants benefit from the present system, though I'm not sure why (perhaps litigation would be reduced if there were shorter patents). I would have thought, on the contrary, that introducing different patent terms by statute would be a boon for lawyers, not just because of the inevitable arguments about the legality of doing so but also in disputes about which inventions fall into which categories, were different terms available.
There are many ways in which patent laws could be improved to ensure that the system provides a reward for inventors while also promoting innovation. But playing around with patent term is not one of them.