Want to know more about patents?

  • The value of patents

    Strategic use of a patent could be good for your business.

    Many of your competitors will be using a ‘passive-defensive’ patent strategy by default. This strategy often involves no patent enforcement. There may be minimal or no advertisement of the existence of the patent. This approach requires minimal effort. When used alone, however, the full strategic value of a patent is not realised.

    We suggest that you consider the following additional strategies to fully exploit your patents and gain an advantage over your competitors:

    Gain income by strategically licensing your patent. For example, you may be able to licence the patent to a larger, better capitalised, or better positioned company. This may increase the chances of successful product commercialisation and generate income more quickly than if the patentee attempted to commercialise the product.

    Offer a license for a patent to settle a dispute, especially to settle a patent infringement dispute. The benefit to you may be financial, or may take some other form, for example access to competitor technology.

    Offer a license for a patent to apply pressure. If you are negotiating with a party for whatever reason, you may consider applying additional pressure by offering a license to your patents that you believe the party infringes or covers strategically important technology.

    Create a new industry standard by licensing your technology. This can place you at the centre of the market.

    Exploit the product protected by the patent and license a second company to do the same. A market may accept your product more readily if a second company also offers it. The second company may be obliged to offer the second product on terms favourable to you.

    Strategically control your suppliers. You may wish to outsource production of part of your product, but protect the outsourced production with patents. Consequently, the supplier of the outsourced product is limited in their ability to sell to your competitors. This may keep the supplier’s prices down and prevent a proliferation of competitors.

    Build a large patents portfolio to decrease the risk of being threatened with patent enforcement. The risk of retaliation by you with a counterclaim increases with the size of your patent portfolio. This strategy may be particularly effective for software and other ICT patents.

    Make yourself more attractive for an acquisition, merger, Initial Public Offering, or a joint venture (JV) with patents. The patents may increase the likelihood of a successful transaction, and increase its financial value.

    Increase your chances of attracting money.  A patent application filed before the submission of an application of a grant application or proposal may increase the chances of the application of proposal being accepted. Many government grant applications, for example, specifically ask for details of filed patent applications relevant to the application.