New patent firm doesn't expect to make money

"Our goal is to enable the Linux ecosystem to grow."

Gerald Rosenthal, chief executive of Open Invention Network

A new patent-holding company, the Open Invention Network, was expected to begin operations yesterday with the unusual business plan of buying certain patents and licensing them without charge.

The firm has the financial backing of five technology and consumer electronics companies -- IBM, Novell, Philips, Red Hat and Sony -- that share an interest in promoting the spread of the free Linux operating system.

Chief executive of Open Invention Network Gerald Rosenthal is a lawyer and the former director of IBM's intellectual-property licensing program. Rosenthal led the technology-licensing program at IBM, which has routinely earned US$1 billion or more in recent years. He will be pursuing a different strategy at the new company.

"By itself, this is not a money-making enterprise," he said.

"Our goal is to enable the Linux ecosystem to grow," he said.

As users or distributors of the free operating system, the five corporate supporters of the Open Invention Network all have a vested interest in fending off threats to Linux.

Legal to Linux users have already surfaced, but none have slowed the adoption of Linux, which is used everywhere from corporate data centers to consumer devices like digital music players.

Yet the legal risk, analysts say, is an uncertainty in the outlook for Linux.

Another for Linux users is the rise of specialized intellectual property firms that acquire software patents, and then make money by licensing the patents as widely as possible.

Patents by the Open Invention Network will be available free to any company, organization or individual that agrees not to assert its patents against others who have signed a license with the new patent-holding company.