Patent pools have been around for a long time. One of the earliest dates back to the 1850s, when four companies formed a patent pool for sewing machines. In the early 1900s the two big aircraft companies, Wright and Curtis, formed a patent pool to produce airplanes during World War I when the US desperately needed these planes. In 1916 a patent pool was formed for the manufacturing of beds.

Industry standardizing technology is another reason companies pool patents, especially in industries where there is a lot of overlapping technology. Some examples include radios, movie projectors, WI-Fi, Bluetooth, and smart phones. The standardized technology is broadly licensed and widely used, and enables products from a variety of manufacturers to communicate. One of the biggest of these patent pools is the MPEG video standard, formed in 1997, which generates an estimated $1 billion+ in annual royalty revenues.

Some patent pools, however, are controversial. The issue is whether or not they encourage or restrict the use of IP, or are overly aggressive in their licensing terms (i.e. not "fair and reasonable"). But for many industries (such as consumer electronics), patent pools have proved to be a great licensing strategy.

If your patent goes up against a lot of big competitors, or is an "essential" part for different products or technologies, a patent pool is a licensing strategy to consider. The key to a successful patent pool is finding other patent owners with technologies that can be pooled together. You get the benefits of commercializing your patent, lowering your litigation risk and combining your patent with others to create a bigger licensing revenue pie.