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.