Most businesses fail to create an effective intellectual property (IP) strategy and as a result, miss out on a range of benefits that an intellectual property portfolio can provide if managed as part of the business. Some of those benefits include access to new markets, iteratively better products, new revenue streams, and competitive barriers for others.
Most organizations view the use of intellectual property portfolio to be limited to one of the following two scenarios:
- As a sword to suppress competition, or
- As a shield to protect against claims of infringement by competition for fear of cross-claim
To derive the best benefits, intellectual property should be considered a key strategic asset class, as a proper intellectual property strategy enables the business to leverage the intellectual property portfolio in a much more profitable way. Although the sword or the shield are indeed valid strategies, they are by no means the only options available. The business should also consider the additional benefits that can be derived by including the following elements in an effective intellectual property strategy:
- Selling (i.e., assigning) the intellectual property rights to another enterprise in whose hands it would be more valuable
- Licensing the intellectual property, perhaps even to competitors if market type and size supports it
- Using the right as a vehicle to organize profit‐enhancing collaborations with competitors, suppliers, customers, or the developers of complementary products
In a similar vein, often a business entering a line of business that may implicate intellectual property rights held by others tries to invalidate the other’s intellectual property rights through litigation, believing that to be the only option available. Although possibly an attractive strategy, it is not the only option. Other options available include: developing an alternative, non‐infringing technology, securing a license from the holder of the intellectual property rights, or building a portfolio of intellectual property rights sufficiently substantial and credible to deter litigation.
The applicability of the various elements of the strategies discussed above will depend upon the context of the specific business, product/service, and market. Therefore, an intellectual property strategy for a business requires weighing the relative costs and benefits of each option. The cost-benefit metrics would generally be very different in the short term as compared to the long term and that fact should be considered when generating the intellectual property strategy. An organization also has to continually monitor whether the intellectual property strategy in place needs to be fine-tuned based on changing product mix, new markets, market shares, competitors, and customers as well as changing laws and regulations. Analyzing the intellectual property portfolio considering both the business and legal aspects enables an organization to best leverage the assets in its portfolio. Attorney Kumar has been responsible for the intellectual property strategy of organizations in his past business experience and can help provide you with valuable insights that can help you avoid costly mistakes and get the most value from your intellectual property assets.