OPINION: Don’t forgo the opportunity of patent millions
How many patents does your company hold? Don’t know? You’re probably not alone. Patents, after all, are seen as something those dry and dusty legal-types handle.
How many patents does your company hold? Don’t know? You’re
probably not alone. Patents, after all, are seen as something those dry
and dusty legal-types handle.
On the surface, the subject looks as interesting as the proverbial wet
weekend in Wigan. And that’s too bad. Because intellectual property is
becoming a major determinant of success or failure.
Billions are at stake for companies which aggressively promote, protect
and market their intellectual property.
That, at least, is the argument in a book published at the turn of the
year. The title, Rembrandts in the Attic: Unlocking the Hidden Value of
Patents, says it all. The authors, two US consultants called Kevin
Rivette and David Kline, argue that if you think patents are just about
protecting inventions such as the film projector, you are missing the
Patents, they claim, can now be used to intimidate competitors, uncover
their strategies, capture market segments and even generate millions in
licensing. They point out that in 1990, IBM licensed unused patents it
was just sitting on and saw annual royalties jump to more than dollars
1bn (pounds 600m) by last year.
What’s brought the issue to centre stage is not just the notion that
intangible assets are a key source of competitive edge. It’s also the
fact that the whole area is fraught with question marks and legal
Witness some of the fiercest battles over the past few years, such as
the simmering resentment between brand owners and supermarkets over
As patent protection begins to stray into ever more nebulous areas, the
potential for missing out on market opportunities multiplies. Consider
the two most modern business areas, biotechnology and the internet. In
the former’s case, the awarding of exclusive licences based on patents
for two gene sequences to a US company, Myriad Genetics, has caused
widespread controversy and raised questions about just how far patenting
Then look at what’s happening in the virtual world. The authors of
Rembrandts in the Attic call it the Internet Patent Wars, pointing out
that the US Patent and Trademark office recently awarded a patent to
Priceline.com’s business model. Meanwhile, Sky Computers in the US is
reputed to be almost half a million pounds richer for selling BSkyB the
Sky.com internet address.
This is probably just the start of intellectual property complexities
and opportunities in cyberspace. And it underlines the importance of
taking an active approach to patents, trademarks and copyrights by
covering all your bases from the start.
In last week’s Marketing, where EasyJet’s Stelios Haji-Ioannou was
rightly scathing about the fact that KLM created its low-cost Buzz
airline without making sure it owned the Buzz.com address. A mismatch of
company and internet branding through neglect or oversight doesn’t help
a company’s brand credibility.
Making the care of intellectual property a core part of marketing
strategy is not just an offensive weapon, of course. It’s crucial for
defence as well. The European Commission estimates that counterfeiting
and piracy costs up to 300bn euros (pounds 181.5bn) a year and more than
200,000 job losses worldwide. In other words, intellectual property
management is about large sums of money. And that’s anything but boring.
This article was first published on Marketing
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