Intellectual Property Drives National & Global Commercial Success.
Intellectual Property (IP) is front-page news in the press, with many high-profile stories grabbing headlines. Many experts believe that we are at the start of a new era for IP transactions. Intellectual property is a term relating to intangible assets owned by a company that prevents third party use or exploitation without legal permission. Since IP has the ability to provide a company with competitive advantages, IP can be defined as an asset where it provides companies similar protective rights as a physical asset. Such protective rights prevent replication by competing firms. Intellectual property is a powerful economic driver and it further is a rich area for career development.
Advanced Nations & IP.
Advanced Nations, like the U.S., have significant infrastructures and corporations that pursue the development of IP rights. Such countries get more foreign investment directly from outside countries and are also rewarded with greater economic advantages, growth and jobs in higher-value industries. Industries that benefit from IP include high-technology industries, electronics, software, fashion, automotive sectors, medical, pharma, life sciences, biotech, energy, entertainment, and green technologies.
Millions of Americans across the country are employed in IP-intensive industries having higher wages, compared to other people. IP-rich industries drive the greater majority of U.S. exports.
IP and intangible asset issues are prevalent throughout the business world. IP issues touch nearly all areas of a company’s operations. Corporate areas that are affected include engineering, R&D, product development, legal and accounting, finance, marketing and sales, distribution, and general management.
The wide effect that IP has on its stakeholders adds to the complexity of managing intellectual property. Each area of IP involvement has requires personnel with their own areas of expertise. Intellectual property is a very broad field. The IP field is probably one of the most important legal fields in the USA. IP has always been a key component in the expansion of the U.S. economy.
Intellectual Capital in Multi-National Organizations.
Intellectual capital is regarded as the most significant asset of the world’s largest, most powerful corporations. It is the foundation for establishing market dominance. It ensures that leading companies can continue to profit.
IP is often the key element in mergers and acquisitions. Furthermore companies are increasingly using technology transfer and licensing as routes to transfer these assets for added revenue.
Intellectual property, more often than not, is a company’s most precious asset. It is the lifeblood required to develop a product and launch new industries. With the rise of global competition, the management of intellectual property assets and the development of unique products associated with IP has never been more important.
Upper Management Thinking & IP.
Until recently, the phrase “intellectual property, or IP”, wasn’t even in the vocabularies of many CEOs. It wasn’t really looked at when developing business strategies. Most CEOs used to leave IP matters to corporate attorneys while CEOs and upper management concentrated on competitive warfare. However, today, IP is considered the main weapon in competitive warfare and more and more CEOs acknowledge that it is required to gain a competitive advantage.
Globally, China, India and other countries have focused their energies to manufacture cheap products. Conversely, Western countries have specialized in developing high-value innovations with creative attributes and functionalities.
In the past, intellectual property was once an area overlooked by many companies. Today IP is the fundamental building block of corporate product lines that allow companies to compete in world markets leading to the success of national and global economies.
Newspapers today are filled with articles concerning intellectual property disputes. Protecting intellectual property is an extremely important are for businesses today.
Economists regard IP rights as an engine for encouraging innovation. They also recognize that they can also be used to inhibit competition. Innovation initiatives and the intellectual property (IP) thrust of companies and engineers are crucial drivers that move humanity to progress. Innovation that results in new-twist products with functional advantages helps remove the many yokes and burdens of life faced by all peoples. Innovation works to save lives, it improves the human condition, it facilitates more connectivity globally, and it provides life changing improvements for every day life around the globe.
Examples of Industries that have High Value IP Assets.
Drug companies, computers and their operating systems, social networking websites, and the entertainment industry are all examples of industries that have IP geared to improve the quality of life. IP rights and their enforcement is vital to the continued flow of future new inventions. Free markets depend on innovations protected by IP.
In the final analysis, protecting innovations by securing intellectual property rights is much better than the alternative of just giving away million dollar or billion dollar ideas to the world. The Founding Fathers included rights in the U.S. constitution to give inventors the ability to enjoy a limited monopoly on ideas they developed. Congress has the authority under the U.S. Constitution to enact laws to issue patents. The U.S. Patent & Trademark Office (USPTO) is the cornerstone of U.S. commercial success in global markets.
The new breed of IP-savvy business leaders acknowledge that in business today, corporate battles are now being waged in favor of securing rights to innovations and ideas, not to control markets by securing raw materials.
America’s most successful innovative companies, including Microsoft, Apple, IBM, Lucent, Dell, Gillette, and Dow Chemical, all recognize that the knowledge economy has given rise to a new ecology of competition. The new competitive environment recognized by these companies values intellectual assets over physical assets as the wellspring of competitive advantage and shareholder wealth.
IP & Value.
It is well established that intellectual property (“IP”) assets, to include patents, trademarks, trade secrets, and copyrights, generate what industry observers might refer to as “extraordinary profits” for their owners. IP causes high levels of returns in comparison to other asset classes. More than ever, IP assets today are contributing more value to corporations than other assets. In 1975, S&P 500 companies had only 17% of their market value represented by intangible assets. By 2010, intangible assets represented 80% of the S&P’s 500 market value .
An example of great success with regard to patents is Walker Digital. Walker Digital, is an innovation laboratory modeled after Thomas Edison’s Invention Laboratory. Walker Digital negotiated rights to its 19 e-commerce patents for 7.5 million Priceline shares. Those shares later increased in value to exceed an incredible $1 billion dollars.
Intellectual Property Infringement Defined.
Utility patents are considered infringed upon when someone makes, uses, or sells a patented product or process without legal permission.
Infringement of a design patent involves fabrication of a design that, is substantially similar to an existing design, where the resemblance induces observers to purchase one design supposing it to be another.
Trademark infringement consists of the unauthorized use or imitation of a mark that is actually the property of another company or individual. Trademark infringement often occurs in the business world in order to confuse, deceive, and or mislead others. This deception is geared in the effort to have people purchase products from a company other than the real trademark owner, where products are counterfeits or knock-offs.
When someone reproduces, adapts, distributes, performs in public, or displays in public a copyrighted work that belongs to another that is Copyright Infringement.
There are different types of patent insurance policies that companies and individuals can purchase. IP infringement or intellectual property liability coverage, guards against patent infringement claims and defends the insured’s ownership rights in the intellectual property. Patent insurance can also indemnify customers and distributors for allegations that might arise that the insured IP is in violation of another’s IP rights. It indemnifies against damages from liabilities that might result from a verdict or settlement. This is the most typical type of coverage with regard to IP liability insurance.
Examples of intangible assets that are not IP include supply agreements, alliances, strategic partnerships, joint ventures, distribution agreements, marketing and sales agreements, independent contractor agreements, and relationship capital.
Any secret idea, concept or fact that is not disclosed by a business includes trade secrets. A trade secret has no definitive time constraint. A trade secret could remain secret or it could remain closely guarded throughout the life time of a product line. An example of a well known trade secret is the Coca-Cola recipe.
The Power of IP in Funding, Licensing & Monetization.
The practice of funding companies on the basis of their intellectual property (IP) and other intangible assets has been emerging for some time. Even through IP, is widely recognized for its role in catapulting the growth of the U.S. economy, the country still fails to acknowledge the real value of intangible assets. In many ways the United States and banks fail to provide innovative companies with the funding they need to commercialize their innovative product concepts.
Patent monetization isn’t just for struggling companies. Industry leaders like Apple, Google, Microsoft, and Oracle are all aggressively seeking to capitalize on their IP through licensing deals while also retaining rights to create advantage for their own products. Microsoft has already earned a lot more money on licensing its patents to Android smart phones than from sales of its own Windows operating system for mobile devices.
Revenue from patent licensing has skyrocketed in recent years, increasing from $15 billion in 1990 to now exceed $110 billion today. Companies are now slowly realizing that IP can be among the most valuable and flexible assets. Experts say that the licensing market is still in its infancy. They say revenues related to IP licensing could exceed a half-trillion dollars annually.
Companies Move to Aggressively Embrace IP.
The asset base of U.S. manufacturing firms has shifted dramatically. In 1982, physical assets such equipment, factories and plants comprised 62 % of a company’s market value. Today this number is less than 30 % of their market value, according to experts at the Brookings Institution. Thus, the bulk of even a manufacturer’s value now depends on their intellectual assets. However, most companies today do a poor job of developing and manage these assets.
When developing innovative products, patent quality is another key area to be concerned with. Patents are the lifeblood of young innovative companies. Small companies rely heavily on patents. They face devastating consequences under the threat of a damaging lawsuit or if their patents are invalidated by a court.
When Crowd Funding, Consider having IP in Place.
It is important to develop some sort of IP defense prior to launching a crowd-funded project. If you don’t have some good IP in place that differentiates you from the prior art when doing a crowd-funded project, there is a good probability that you are going to get a judgment against you and that you might be given a cease-and-desist letter.
The Uriel Corporation Think Tank gives innovators and companies an Edge in their Product Commercialization Efforts.
Intellectual property engineers, advisors, consultants and attorneys play a large role in shaping the future as they work with inventors and innovators.
The Uriel Corporation Think Tank assists inventors and innovative companies to help them define, refine, and perfect ideas and intellectual property to develop such ideas into a more potent commercial form that can better address national and global markets. Uriel assists inventors, startups. and more established companies to help them throughout all stages of the commercialization process. The Uriel Corporation Think Tank Consults Clients and assists by engaging in full turnkey product commercialization consulting, including but not limited to:
- patent searches,
- patent and trademark development,
- tweaking existing patents to create expanded patent portfolios,
- prototype development,
- product development,
- technology transfer,
- preparation of NDAs and other agreements,
- win-win partnerships and alliances,
- the negotiation and development of joint ventures, strategic alliances, and commercialization agreements with third parties,
- the negotiation and development of joint ventures, strategic alliances, and agreements for manufacturing,
- the negotiation and development of joint ventures, strategic alliances, and agreements for distribution,
- the negotiation and development of joint ventures, strategic alliances, and agreements for marketing and sales,
- subsidiary and corporate launch consulting to launch new products or ventures,
- technology search and acquisition,
- the negotiation and development of licensing agreements with third parties.
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Contact Uriel Corporation today to see how Uriel can help you create or find and acquire disruptive patented or patentable innovations!!