It is an era in which technological resources become the basis of a company's competitive advantage and a driving force for success. Apple, Google, and Tesla are those companies that first comes to the mind. This is why the use of intellectual property rights (IPR) secured from technological inventions is important. Then, how should we manage technology assets that affect the company's performance?
1.
The functions of patents
Patents grant the right to prevent third parties from practicing the patented invention without the consent of the owner. That is, the patentee can freely carry out the invention within the scope of the patent's rights for a certain period of time, and can monopolize the profits generated therefrom.
2.
Alternative means of patents
There are ways to manage technology assets as a substitute for patents: secrecy and publishing. Secrecy, literally, are not disclosed and have independent economic value, and are technical or managerial information useful for production methods, sales methods, and other business activities that are managed confidentially within a company. Unlike patents, exclusive rights are guaranteed as long as confidentiality is maintained.
On
the other hand, publishing is the disclosure of technology so that others
cannot secure intellectual property rights for the same or similar inventions,
artistic and cultural creations. Since it can be spread as widely as anyone can
freely implement it, not only can the overall technology level be improved, but
the technology can be made an industry standard to preoccupy the market. It is
important to carefully judge which strategy is desirable to take.
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3.
Choice of technology asset management method
It is necessary to examine and judge which of these three methods to select from the perspective of profit monopoly and free operation, as well as the given environment of the company.
# Profit
monopoly
How
exclusively the revenue generated by technological innovation can be secured
has to do with legal means and technical characteristics. In general, the more
difficult it is to imitate, the larger the size of the revenue. However, even
if the technology is in the maturity stage or difficult to imitate in a
complementary industry, it is not necessarily profitable. This is because the
degree of monopoly differs by industry. So which method is more effective?
In general, patents and secrecy are more effective than publishing. This is because revenue can be monopolized not only through the technology itself, but also through the sale of products, services and licenses based on the technology. However, as technology complexity increases, patents are more advantageous than secrecy. This is because it can defend competitors' R&D and gain the bargaining position, and it helps to secure new customers and attract investment. As technologies are getting more complex, the advantages of these patents are getting more attention.
# Freedom
to operate
Because patents contribute to prior art, they give them the right to operate them freely. Publishing cannot be patented as it has been disclosed to the public, but likewise a patent, it achieves the freedom to operate. However, secrecy can no longer be freely enforced if others first secure a patent. Therefore, patents and publishing are more effective than secrecy as a way to guarantee free licenses.
Of course, in reality, the complexity of the background technology must also be considered. Operation may be restricted if others have the relevant intellectual property rights. So, leading companies respond with a patent portfolio strategy. This is because a defensive negotiating position can be secured to enable various license agreements. In particular, it is effective to hold a patent in a complex technology field where other intellectual property holders rely on the patents of leading companies. This is one reason why Google acquired large patent portfolio from Motorola. Publication strategy alone cannot provide useful intellectual property rights for bargaining. In other words, as technology complexity increases, patents are more advantageous in protecting free licenses than publishing.
How
about the industry with high technological cumulativeness? Similarly, patents are effective.
As the technological cumulativeness increases, the future technology is based
on the prior art, so prior patents may hinder the commercialization of the
future technology. At this time, companies with strong patent portfolios can
use Cross Licensing and Grant Back to avoid issues related to improved
technology. Patents are superior to strategic publication to achieve freedom to
operate technologies both now and in the future.
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| pixabay.com |
Sometimes
publishing is better than patenting. This is because it can improve the overall
skill level of the industry or generate revenue from complementary
descriptions, products and services. There is also a way to protect profits by
keeping it as a secrecy. However, patents are a means to widely commercialize
not only producing and marketing, but also the sale of patent rights and
various types of licenses. Despite of management costs and related technology
inventions of competitors, it is highly likely to be an excellent strategy in
terms of profit monopoly and freedom to operate.
*Source : Summary and excerpted from
“The patent management trichotomy: Patenting, publishing, and secrecy",
by Marcus Holgersson and Martin W. Wallin (2017)
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