Tesla to open source all its patents

Palo Alto-based electric-vehicle company hopes to spur faster innovation

In a bid to advance electric-vehicle technology, Tesla CEO Elon Musk has announced that the company is in effect open-sourcing its patents. On the Tesla blog, Musk wrote on Thursday the company had taken down its patents from a lobby wall in its Palo Alto headquarters.

"Tesla Motors was created to accelerate the advent of sustainable transport," he wrote. "If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal. Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology."

The move will hopefully help the auto industry transition faster to electric-vehicle production and to improve carbon reductions, he said.

In the post, which is titled, "All Our Patent Are Belong To You," Musk writes that he used to think patents were good when he started his first company, Zip2, "but too often these days they serve merely to stifle progress, entrench the positions of giant corporations and enrich those in the legal profession, rather than the actual inventors."

"At Tesla, however, we felt compelled to create patents out of concern that the big car companies would copy our technology and then use their massive manufacturing, sales and marketing power to overwhelm Tesla. We couldn't have been more wrong. The unfortunate reality is the opposite: electric car programs (or programs for any vehicle that doesn't burn hydrocarbons) at the major manufacturers are small to non-existent, constituting an average of far less than 1 percent of their total vehicle sales.

"At best, the large automakers are producing electric cars with limited range in limited volume. Some produce no zero emission cars at all," he wrote.

Musk said that the vast and continually growing body that is the global vehicle market is impossible to keep up with.

"Our true competition is not the small trickle of non-Tesla electric cars being produced, but rather the enormous flood of gasoline cars pouring out of the world's factories every day. We believe that Tesla, other companies making electric cars, and the world would all benefit from a common, rapidly-evolving technology platform," he wrote. "We believe that applying the open source philosophy to our patents will strengthen rather than diminish Tesla's position in this regard."

Commenters mostly applauded the idea, viewing it as a bold move and a positive step for the company.

"It is wonderful to see altruism and sound business decisions converge. I couldn't be more proud to be a Tesla owner and shareholder. Great job, Elon!" one reader wrote.

"As a stockholder and a Model S owner, but mostly as a temporary resident of a threatened planet, I highly approve and am cautiously optimistic that this move will accelerate the cause of electrifying transportation," another said.

Robert Fahey approved, but with a caveat:

"A more robust EV segment can only help everyone with skin in the game. This is a rare situation where rivals can do much better if they share technology and take advantage of shared experience and buying power. But this begs a big question: If Tesla is supply-constrained right down to the batteries, and needs a massive new factory just to keep its head afloat, how could any rival leapfrog Tesla even if it has the 'blueprints' to do so? Where would it get the goods? I don't see any significant change to the automotive landscape coming anytime soon, patents or no patents. But I do see yet another PR boost for Tesla here," he wrote.

Tesla's stock dropped to close at $203.52, down .95 (0.46 percent) on the NASDAQ index in afternoon trading after the news, after a high of $209.88 from its opening of $205.10 in morning trading. The stock was at $203.55 in after-hours trading.

Some investment newsletters and analysts have put Tesla stock in a "hold" category recently -- viewing it as neither bullish or bearish. But the company's fair-use move could be an answer to the criticism that it hasn't become mainstream or ramped up fast enough.

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Like this comment
Posted by Cal
a resident of Downtown North
on Jun 12, 2014 at 3:23 pm

This is just an attempt by Tesla to get people to do their R&D for free. Instead of hiring hackers to write new code, theyre going to ask people to do it for free. This is a very cynical way of cutting costs.

Like this comment
Posted by Donald
a resident of South of Midtown
on Jun 12, 2014 at 7:09 pm

Umm,I think you have this wrong, Cal. They are not moving to open source software for their cars. They are basically relinquishing all their patents to let other people use their technology for other cars or other uses. The phrase "open source" was a poor one to choose for describing this. I like "All our patent are belong to you" much better.

Like this comment
Posted by Palo Alto native
a resident of College Terrace
on Jun 12, 2014 at 10:55 pm

I applied for one of their PR jobs some months back. Not hired. In my letter I note how their technology represented a huge paradigm shift. But not at 100k per unit. I rcommended creatimg a range Of EV vehicles (do the Henry ford approach and produce a car that was affordable for the masses). They have the chance to significantly reduce domestic and international fuel dependency! An opportunity to reduce air pollution. There's also the secondary industry of converting second hand gas cars to electric. Talk about altering geopolitics, OPEC, and gulf wars. Well, this is a start. I'd love to be the next Henry ford of EVs (without his abuse of labor) by creating an affordable EV of 12, 20, and 30k per
Units. Tesla can have the 100, 80, and 50k buyers. It's the global impact and volume sales that I think would bring a lasting legacy for the good of the human condition. We r indeed, temporary stewards of this rare planet.

Like this comment
Posted by Famous Quote
a resident of University South
on Jun 13, 2014 at 12:39 am

When asked a couple of years ago why he did not focus on producing a less expensive car for the masses, to have a larger effect on the reduction of carbon emissions, Elon Musk was said to reply: "if I build expensive cars, I don't have to build very many!" I am assuming he meant not having to build so many to make a profit.

Like this comment
Posted by Fake Quote
a resident of Duveneck/St. Francis
on Jun 13, 2014 at 1:19 am

@Famous Quote - Not only did you made up that quote, the opposite is true. Here is a real quote with a real source.

"The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model.

Without giving away too much, I can say that the second model will be a sporty four door family car at roughly half the $89k price point of the Tesla Roadster and the third model will be even more affordable. In keeping with a fast growing technology company, all free cash flow is plowed back into R&D to drive down the costs and bring the follow on products to market as fast as possible. When someone buys the Tesla Roadster sports car, they are actually helping pay for development of the low cost family car."

Web Link

Like this comment
Posted by Palo Alto native
a resident of College Terrace
on Jun 13, 2014 at 11:45 am

Thanks 4 the response from one Tesla representative. Sadly, the 89k unit price remains far to high for the vast majority. Even half of that cost at 44k is still too steep. The magic number is 12 to 16k even for a more limited range and longer recharge time. And then a medium cost unit at 35k. Next would be the elite 89 and 44k units (keep those too). I also advised tesla to plow profits not just into RandD but acquire more electric energy producing factories in the form of solar and wind farms. Also biomass, current, sea thermal, and hydro energy. I would continue to lobby for state and federal rebates to commission more and more of these green industries. For example, the SF bay is a huge wind farm as most of the South Bay is not navigable (too shallow). Tesla could be a global leader in both EV design and alternative energy production using the latter profits to mass produce affordable EVs. Those volume sales would drive more acquisition of energy farms, too.

Like this comment
Posted by steve
a resident of Professorville
on Jun 13, 2014 at 6:09 pm

So much for the comparisons between Elon Musk and Steve "Thermonuclear War" Jobs.

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Posted by CrescentParkAnon.
a resident of Crescent Park
on Jun 13, 2014 at 8:29 pm

I like this idea ... but I am sure there is some plan behind it ... like Sun Micro making Solaris Open Source ... to get people to work on it for free before it crashed and burned?

Seems to me as I drive around Palo Alto, the competition for Tesla, at least competition in the sense of people who want environmental economy cars with value is Toyota and its Prius.

It seems like there are 4 or 5 Priuses, Prii, whatever the plural for Prius is, on every block of Palo Alto. We just got one and all of a sudden I realize there are hundreds of them tooling around Palo Alto getting about 50 miles per gallon in the city. I love it. I do kind of miss accelerating, but having my gas bills cut in half is like getting $2 a gallon gas again - so I'll survive.

The hybrid idea seems clunky but what we have is a great liquid fuel distribution and storage infrastructure, not so much a great electric transmission and storage infrastructure, but I'm sure we'll get there at some point. I do not really see the numbers of cars Tesla is producing as a driver of lower cost electric cars. I think people are getting them as status symbols and because they are supposed to be very fast ... for a short distance anyway.

Just a nod to the brilliance of Toyota and the Prius. When buying a Tesla makes business sense, then Tesla gets my nod!

Like this comment
Posted by Truthfully
a resident of Another Palo Alto neighborhood
on Jun 13, 2014 at 8:33 pm

I have to admit that in all honesty, reading that Elon Musk was such a dead eat dad that he could not return to South Africa and his first ex-wife Justine had to move here to force him to see his kids and support them made me not want to EVER buy any product of his.

Sorry, but further commenting on this topic has been closed.

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