Strategic Intellectual Property Commercialization and Methods

Strategic Intellectual Property Commercialization and Methods

This research paper describes the “Strategic Intellectual Property Commercialization and Methods”. Commercialization is basically done to earn profits from the technology or the invention by bringing that technology or invention in the public domain after protecting it with the help of legal means. Various strategies and techniques can be followed to commercialize an IP. Companies may adopt a number of commercialization strategies, ranging from direct sales to the outright sale of their technology.

 Commercialization methods which can be used by the industries or companies to effectively implement their business goal are as follows  

A.      Licensing

B.     Cross Licensing

C.     R & D growth

D.     Sale / Merger / Acquisition

E.     Patent pool

F.      Donation

G.    Dump  

IP Commercialization Methods

• Create a list of potential manufacturers who may be interested in your product. Aim for a list of at least 50 or more.
• Find manufacturers by looking in stores and magazines for similar products. Visit product related tradeshows. Your local library should have great reference material on manufacturers.
• Use "Online Manufacturer Databases" such as the Thomas Register to search for companies that make a product like yours. You can do an Internet search for manufacturers by using the keywords of your product.
• Send a brief individually tailored and professional looking marketing letter to each company on your list. The letter will state that, you are willing to consider selling or licensing the patent rights to your invention.
• With your marketing letter, it is superior to include a professional looking brochure and a website address connected to your product.
• Wait one month, if a company has not replied you can then telephone them to see if they are interested in your product.
• Before discussing your invention in greater detail with a company, sign a non-disclosure agreement. You should consider having a lawyer draw one up for you.
• If you have the opportunity to negotiate for a licensing agreement, use an experienced lawyer. It is not advisable for you to negotiate the contract on your own.
• The license agreement will include provisions for upfront payments, royalty percentages and infringement issues.

• Suzuki licenses his technology to Maruti.
• Mahindra and Renault

• Cross-licensing of patents is a defensive strategy used by companies to protect itself from the patents of its competitors.
• The goal of cross-licensing is mainly the freedom to continue to compete in the marketplace.
• By cross-licensing their patents to each other, companies share the rights to use their respective patents, each with the permission of the other.
• Cross licensing provide competitive benefits to both parties by integrating complementary technologies, reducing transaction costs, clearing blocking positions, and avoiding costly infringement litigation.

• Commercialization of inventions and R & D results must always begin with an in depth assessment and evaluation of their technological and market potential as R&D plays a major role in IP Commercialization for development of new technologies which in turn, bring out new & improved product for consumers.

• On realization of ideas into a final product, further growth and  improvement of the product is needed for development of improved & more efficient product, here R & D faculties come into play as they help in future growth of product. Various Strategy used by R&D managers & companies are given below

•  
  • New development driven by market requirements 
  • Internal R&D  with/ without outside consulting 
  • Cooperation with universities 
  • Purchase of small technology companies 
  • Use of R&D partnerships 
  • Association or alliance with local companies 
  • Copying a product of a competitor 
  • Purchasing of Patents
  • Contracting for development by R&D firms 
  • Purchase of technology from large companies 
  • Contract R&D to foreign development organizations 
  • Purchase of foreign technology &/or patents 
  • Use of high-tech incubators for new R&D organizations 
  • Government developed technology or patents

• After the globalization the merger and acquisition is also become the key component for the companies to grow their business. Companies are looking for the organic as well as the inorganic growth to execute their business strategies to have competitive edge in the market. IP portfolio asset transferred play a vital role during company merger or acquisition. Whether your company is buying or selling, and whether the transaction involves the sale and purchase of business assets or company shares, you will need to consider and assess the IP aspects of the transaction.

• Companies having more IP asset are being considered as more valuable and preferred for merger or acquisition. Complete due diligence need to be done before going for the merger or acquisition which includes key patents, life of patent, any legal implications, patent protection coverage, R&D plans and  transaction related to other forms of IP. Complete competitive analysis based on the existing technology and future market demand need to be study based on the IP portfolio of the member companies to successfully implement the effective IP transfer strategy.

• AlliedSignal Inc. and Honeywell Inc. announced today that they have received clearance from the European Commission to complete their merger. Year-1999.
• Acquisition - NVIDIA to Acquire AGEIA Technologies Year-2008

• Thus, its formation can save patentees and licensee’s time and money by reducing mutual negotiations of cross-licenses.
• Patent pools are only one example of cases where members of other competitive industry join in common interest to create some product that is to their combine benefit.
• Pooling is basically done to reduce risk and coordination costs.

Ø      the auto industry collaborates to standardize components;

• Everyone knows the use of compact cassette or video cassette used in the recorder, or a CD in the CD-player.
• Since the last decade, DVD has been the successful commercialized standard of CE for data storage as it can store 6 times more data than CD.
• DVD is a popular optical disc storage media format that is used for video recordings and data storage in computers.
• MPEG technology is important for storing the actual video data on DVD discs as it uses various compression formats.
• For that reason, they combined both the technologies into a single one.

• Tax Exemption benefit by the use of the patent donation.

Ø      Causes goodwill.

• Your company must be profitable and have tax liability.
• Your company must give up all ownership of the technology.
• The value assigned to the donation is critical.
• The recipient must be a qualified non-profit.
• The technology must be viable.

IIT Khargapur