Tesla's patent announcement may be more symbolic than significant

Musk's bold move generates goodwill, but will it generate innovation?

 Tesla Motors
It's foolish to bet against Elon Musk, but allowing yourself to be blinded by hype isn't too wise, either. 

Tesla will proudly tell you that it doesn't have to advertise to keep orders for its Model S flowing in. With a man like Elon Musk at the helm, why should it?

Look at what happened when Musk announced that all of Tesla's patents would be made, essentially, open source. #Tesla immediately began trending on Twitter; comparisons between Musk and action hero Tony Stark intensified; dreamers began dreaming about the coming age of affordable electric cars.

Musk, and by extension, Tesla, come out on top again -- disruptive heroes shaking up not just the auto industry, but indeed, our entire creaking, outdated patent system.

We like Musk's product. We like his wild-ass ideas. We're certainly not going to begrudge a man willing to publicly discuss the possibility of a flying car his time in the spotlight, especially if he has the bank account to make such a wondrous machine a reality.

But -- and there's always a “but,” isn't there? -- we should stop hyperventilating about this patent giveaway until we figure out what, exactly, Tesla might have that other automakers don't, and ponder what Tesla stands to gain from this action.

 Davey G. Johnson
"I am Iron Man."

Much of Musk's statement rings true. On intellectual property as it exists today, for example: “too often these days [patents] serve merely to stifle progress, entrench the positions of giant corporations and enrich those in the legal profession, rather than the actual inventors.”

Hardly groundbreaking stuff, that, but it's different when it comes from a businessman instead of an academic.

Still, the notion that Tesla's magnanimity will throw wide the floodgates of electric vehicle innovation is a bit naïve. Automakers aren't struggling to develop electric car technology that can meet the theoretical daily demands of the majority of drivers. There's nothing magical about a Tesla Roadster or Model S -- certainly nothing that can't be reverse-engineered by a large carmaker.

What automakers are struggling to figure out is how to build EVs at a price that the majority of drivers can afford, while contending with a crippling lack of infrastructure that limits their real-world practicality for a large portion of potential buyers.

What Tesla has accomplished since 2003 is impressive, but the company has a certain Silicon Valley cool that broadens its offerings' appeal far beyond well-heeled eco-nuts. This techno-cachet, along with the performance figures to back it up, allows the Model S to credibly compete with German luxury sedans within a certain subset of the market.

 Tesla Motors
Teslas aren't special because of the shape of their plugs -- they're special because of how well they work as glimpses of the automotive future.

A very, very tiny subset of the market. Despite Tesla's outsize public image, it has moved well under 50,000 vehicles since it was founded more than a decade ago. Many of those went to owners who already owned several cars. McLaren owners are well represented statistically; frugality is not a priority for Tesla's current crop of customers.

For all but the truest of believers, then, the Model S is a nice addition to a stable -- a primary vehicle, perhaps, but one backed by a fleet of emergency alternatives.

During a good month, Ford can sell around 70,000 F-150s. Which hints at what Tesla lacks: Scale and widespread reach. It canbuild all the Supercharger stations it wants, but what good is a coast-to-coast charging system if there's practically no one out there to use them? Is it even feasible for a company as small as Tesla to take the long view, slowly growing its infrastructure to accommodate drivers outside of dense, urban areas?

Until it can, there's arguably a cap on the number of buyers willing to make a Tesla car a part of their life.

If even one larger automaker adopts Tesla's charging tech, the case for investment in a grid of chargers gets a lot stronger. That's good for selling all EVs that use that system, which in turn helps boost demand for -- you guessed it -- Teslas. Widespread adoption of Tesla's battery system would also keep orders flowing into its proposed Gigafactory.

 Tesla Motors
Tesla's patent move is certainly good public relations, but we're not yet sure if it'll amount to anything more.

Were Tesla truly sitting on a trove of especially profitable technology, automakers would be forking over money to license it -- or investing in their own versions. But what makes Tesla's cars special is how well they work as an integrated whole as a glimpse of the future -- not the shape of their charging plugs.

Perhaps Musk figures that, by essentially making his company's know-how part of the public domain in the most attention-grabbing way possible, the public can now raise an eyebrow at automakers who claim (rightly or wrongly) that EV technology is too expensive to develop. Tesla just made it all available for free, and in doing so, probably made its system the most logical jumping-off point for an industry standard.

As for the more exciting possibilities? We'll concede that Tesla's patents could conceivably help a fledgling automaker get off the ground. To do so, though, that startup would have to jump through a bewildering array of regulatory hurdles -- and then there's the small mater of raising the capital to actually design, build, test and distribute the thing. It's not the kind of thing you can do for cheap in a shed behind your house.

Just ask Elon about that. His personal fortune didn't hurt his company's odds, and neither did that $465 million Energy Department loan (since repaid, to Tesla's credit). Which brings us back to the big automakers, unless this knowledge dump spurs a tech company sitting on mountains of cash (like Google) to begin experimenting with transportation.

So it's true enough that Tesla doesn't buy ads. But for the price of some patents, it has just bought an incredible amount of goodwill and an untold number of headlines. Whether its decision will do anything other than increase Tesla's positive public image however, remains to be seen. Until then, maybe tone down those Tony Stark comparisons.