Assignment #12 Efrat's lecture on Intellectual Property Part 2

Hey guys,

In this installment I will continue talking about intellectual property as a strategic business asset. In addition I will touch upon the increasing size of the IP marketplace and I will talk about the four key external forces that impact the IP marketplace. I will conclude by talking about the IP strategy for growth.

In our lecture Efrat talked about the ever-increasing size of the Intellectual property marketplace and she used the mobile patent wars as an example. Currently 250,000 patents have been filed for smartphones and that number is projected to go up. In the last five years or so a myriad of multi billion dollar deals have taken place for IP acquisition. One of the biggest acquisitions was Googles buyout of Motorola.

The IP market is impacted by four main external forces.

1. IP litigation is at an all time high
2. the patent transaction markets are currently very active
3. All the global competition is causing a change in the IP playing field 
4. the U.S patent and trademark office is both overloaded and underfunded which is a big problem. Another factor which is not one of the main four but still impacts the IP market drastically is the role that non practicing entities play. They just file hundreds of patents, wait around and file lawsuits against companies for patent infringement, which is why they are referred to as patent trolls

The last topic I want to address is IP strategy for growth. This was probably the most interesting part of Efrat’s lecture because we learned where the IP market is going in the future. The main idea is to grow IP over the course of its life cycle into a strategic business asset. First you develop an IP position, than you portfolio commercialization and monetization and finally you perform portfolio liquidation. Efrat went over some of the the key points to consider when growing an IP portfolio to maximize valuation. These included:

-freedom to operate

-hedge against litigation

-attract buyers and investors 

-monetization 

-and liquidation value

Thank you for tuning in and hope you were able to learn something new about Intellectual Property.