Many companies partner with universities on research to develop new products, improve their existing products, or simply increase their profits by leveraging university research and development (R&D) capabilities. Generally, these relationships use a proprietary standard research agreement (PSRA); for historical reasons, these agreements contain significant intellectual property (IP) monopoly language and restrictions on both the company and the university.
These standard research agreements create a barrier to collaboration for companies using a libre model and the universities they wish to collaborate with, as both parties must invest significantly on attorneys’ fees to restructure the contracts. This is money that could be better spent to drive innovation in the labs. Worse, time spent on contract restructuring creates delays that hamstring cutting-edge research.
In a new Inventions article, “Sponsored Libre Research Agreements to Create Free and Open Source Software and Hardware,” I’ve laid the foundation for a sponsored libre research agreement (SLRA) to solve these problems. This new type of contract allows companies working in open source arenas to more easily partner with universities to move research forward.
Maximize innovation by eliminating waste
When companies spend more money on lawyers than engineers, it is hard to pretend they are maximizing innovation. Instead, a growing number of companies have begun to reject IP monopoly-based strategies as inefficient use of company resources. These companies are embracing libre product development for both free and open source software and hardware using open source business models.
Companies embracing libre product development range from the multi-billion-dollar Red Hat to hundreds of small startups. At least 78% of conventional companies use open source products. For this majority of companies, the SLRA provides a solution for collaboration with universities.
Differences between PSRAs and SLRAs
The differences between the two types of agreements are substantial. First, changes to the SLRA’s reporting requirements eliminate all unnecessary reporting that otherwise slows research progress.
Second, a clause inserted in the confidentiality section specifically attempts to minimize confidential-information sharing and requires both parties to be immediately notified if any of this information is shared. This clause reduces potential delays of a month or more (a long time in rapidly evolving fields).
Third, in the SLRA’s publication section, the PSRA’s standard 30 day-review is shortened to 10 days for publications and eliminated for patents. In its cleanest use, the SLRA states no patents would be filed for inventions by either party related to the project. Collaborators wishing to file patents (using a Red Hat-style patent promise approach) would need to further modify this section. For libre projects, university and corporate partners normally meet (even if virtually) at least weekly, so further delays have no benefit to either party.
Fourth, the IP clauses have been shortened significantly. Similarly, the agreement’s IP license section can be significantly reduced by detailing specific open licenses, including Creative Commons (CC BY-SA) and GNU Free Documentation License (GFDL) for documentation, GFDL for free and open source software, and CERN OHL for open hardware. These licenses not only eliminate the negotiation period, license, and reimbursement for IP-related legal work from the research agreement but also eliminate the need for even more costly legal work in practice.
The aggregate effect of moving from a PSRA to an SLRA is that both companies and universities can reduce time and money to set up collaborative research by virtually eliminating legal work. In addition, university investigators can use the money they save to advance their research (e.g., rather than spending money on bureaucracy and legal fees, they can hire more researchers), giving companies more value for the same investment. In the long term, SLRAs could even reduce the overhead associated with university research.
In summary, the advantages of using an SLRA include:
- Minimizing research investments on reporting requirements;
- Reducing delays related to confidentiality and publication embargos; and
- Decreasing transaction and legal costs as well as loss of research time associated with IP.
As a result, companies that work in free and open source software and open hardware get a bigger bang for their buck while still working with their favorite university research collaborators.
If you’d like to explore this new type of research agreement, the supplementary material of my Inventions article contains a template SLRA and all the required language; it can be easily adapted for any type of business-university research partnership.