Since it was first founded in 2005, the Open Invention Network (OIN) consortium has grown to a community of around 2,700 members from a vast array of industries. The singular mission of OIN is to provide a patent non-aggression zone around Linux, a family of open-source operating system software built around what is known as the Linux kernel. Originally developed for personal computing platforms, Linux has found much wider applications in smartphones, automobiles, distributed ledger tech and more.
Companies that join OIN are provided with a cross-license to patents covering Linux system technologies which are owned either by other OIN members or by OIN itself, which holds a patent portfolio worth about $100 million including patent assets that the consortium has purchased from other entities as well as those which have been developed by OIN. Companies joining OIN sign an agreement providing other OIN members a cross-license to their own patents that cover aspects of the Linux system.
As Jaime Siegel, OIN’s Global Director of Licensing, notes, OIN is able to grant free membership to companies joining the consortium thanks to the efforts of eight full-funding member companies which have each funded $20 million to support OIN’s operations through an endowment. These companies include the first six companies to form OIN: Sony, Phillips, IBM, Red Hat, NEC and SUSE; joining those companies are Google and Toyota. OIN’s board consists of representatives from each of these full funding members. Every new member of OIN signs the same licensing agreement as the full-funding members, giving all members in the organization equal standing in terms of the cross-license agreement.
“OIN’s mission is very targeted specifically towards open source and more specifically towards Linux,” Siegel said. “We exist to solve issues from a risk litigation perspective in a way that’s similar to patent pools with the exception that there’s no royalty to pay.” He noted that the open-source community is largely a culture-based community that involves participants which have strong views on how open-source is supposed to function in the software community. “Participating in OIN is a free and public way to wear your support for open-source software,” he said.
Most of the companies that are members of OIN focus their development of technologies on the application layer of the Linux technology stack. “Application layer, in effect, refers to anything that end users can touch or see,” Siegel said. “For example, if you use Android on your phone, what you’re seeing is the application layer. What you can’t see is the code that powers the engine behind that.” Linux-based systems have been widely adopted by companies and OIN’s membership is very diverse including major automotive manufacturers like Daimler and Honda, major carriers like AT&T and Vodaphone, online companies like Yahoo and JD.com, networking firms like Juniper and Cisco, and other major financial institutions, industrial firms and software companies. One of OIN’s most recent members is Ant Financial, an affiliate of Alibaba Group and the world’s most highly valued fintech company.
Siegel said that the only kind of company that wouldn’t benefit from membership in OIN would be a company which was building a patent assertion program to get companies to license Linux core patents. Despite the massive expansion of Linux-based systems across industries, however, Siegel said that there has been virtually no patent litigation around the Linux core. “While OIN won’t take all the credit for it, I think OIN has been a big factor as to why there’s been so little litigation around the Linux core,” Siegel said. “While we are a pro-patent organization, we’re very aggressive about going after assets that are threats to Linux and opposing activities that are targeted against the Linux core.”
OIN is not the only patent licensing consortium that exists to give its members protection against infringement lawsuits and we recently profiled the organizational model and activities of LOT Network on this site. Siegel noted a number of significant differences between OIN and LOT Network. First, there is no cost to new members for joining OIN. Second, while OIN is not a non-profit company, it’s also not a for-profit operation in the sense that it generates funds from new member fees or licensing revenues. Third, and perhaps the main difference between OIN and LOT, OIN doesn’t place encumbrances on the patents owned by its members. “We’re not about putting restrictions on our members portfolios beyond the commitment to cross-license patents in a very narrow scope,” Siegel said. He also drew additional differences to entities like RPX Corporation, which pays group settlements to resolve litigation, and Unified Patents, which provides services unrelated to licensing.