Radio broadcast .. (1922-30)

"Cooperative Competition" 517 as the "millionaires' folly." But Joy increased the production schedule for the next year, and by his own untiring efforts, together with the financial backing of his directors, made the Packard Company a success. MR. SELDEN AND HIS PATENT FOR several years the Selden patent was a dominating influence in the industry. Mr. George B. Selden, a patent lawyer of Rochester, N. Y., with inclinations toward mechanics, invented the gasolene automobile in 1879. He immediately made application for a patent, but there followed repeated delays — apparently encouraged by Selden himself, who was trying to interest capital in his new invention— and it was not until 1895 that the patent was issued. Mr. Selden did not manufacture under it and in 1899 sold control of his patent to the Columbia & Electric Vehicle Company which soon afterward became the Electric Vehicle Company. Eastern capitalists were interested in this company. They began a campaign of vigorous enforcement of the patent the next year. Suit was brought against the Winton Motor Carriage Company for infringement. This suit ran along until 1903 when the Association of Licensed Automobile Manufacturers was formed and ten companies signed an agreement recognizing the validity of the Selden patent and agreed to pay a royalty of ij per cent, of the retail price of all cars sold by them. The Electric Vehicle Company had an arrangement with Mr. Selden as to Why Not "Cooperative Competition" in Radio? Last month, in our editorial, "Monopolizing Production of Apparatus," attention was called to the possible harmful results of the patent litigation of the Radio Corporation, involving various smaller manufacturers of radio apparatus. It seems to us that there is a marked similarity between the patent situation in the radio business and that which existed in the automobile industry until an agreement resulting in "cooperative competition" was reached. This agreement is described in the accompanying article. There is one essential point of difference between the radio and the automobile patent situations: The Radio Corporation, with its associated companies, in all likelihood holds patents of greater value than those of all the other companies together, and the working out of an equitable arrangement may be an even more difficult problem than that which the automobile industry had to face. It does seem, however, that a study of the agreements made by the automobile companies might result in a working plan that will save millions of dollars, not only for those now vitally interested— the manufacturers — but also for those who ultimately pay the piper — the users of radio apparatus. Many people view with alarm what seems to be an attempt by the Radio Corporation to form a monopoly in the production of radio apparatus. Perhaps the litigation is designed merely to test the validity of certain basic patents and thereby to determine their commercial worth. If this is the case, should not the public be informed by the Corporation how it expects to use the power acquired if the courts decide in its favor? — THE EDITOR. amount of the royalty he was to get. Mr. James Rood Doolittle, who wrote "The Romance of the Automobile Industry," estimates that Mr. Selden realized about two hun dred thousand dollars from his invention. As the industry grew, this i| per cent, royalty soon began to run into large sums and the payments became burdensome on the industry. It was then that Henry B. Joy, president of the Packard Company, led a vigorous fight within the ranks of the Association of Licensed Automobile Manufacturers to have the royalty reduced, and was successful in first having it cut to i per cent, and then to | of i per cent. It was in the fall of 1903 that the famous test suit against the Ford Motor Company was instituted by the Electric Vehicle Company at the request of the Association of Licensed Automobile Manufacturers. This case was in the courts eight years and the testimony taken fills thirty-six large volumes. In 1909, Judge Hough, in the United States District Court, rendered an opinion sustaining the Selden patent in every particular and granting an injunction and an accounting. Ford appealed the case to the United States Circuit Court of Appeals and gave bond to cover damages to the complainants while the case was pending. The other so-called "independents," who were interested with Ford in the fight, but were not as strong financially as the Ford Company, decided, after Judge Hough's sweeping decision, that they could no longer afford