Patent Peace Treaties: Deals to Monetize your IP Portfolio
New patent lawsuits arrive in court every day. Companies aggressively battle to protect and defend intellectual property rights, thinking that is the only way to make the most out of their patent portfolio.
At an increasingly frequent rate, those claims of patent infringement are quickly developing into patent deals where companies agree to cross-license the patents for broader protection. What this clearly shows is your existing patents can be worth much more than a costly legal battle when strategic partnerships are formed.
Microsoft, Apple, HTC and Amazon are just a few of the mega-companies that have recently established patent and cross-licensing deals instead of heading to litigation. These patent holders are part of a trend that smaller companies can also take advantage of and learn from. For many companies, your patents are some of your most valuable assets; knowing how to make them work for you after you’ve secured the initial protection is a strategy every business can explore.
A patent gives its owner the exclusive right to make, use, sell, and offer to sell the patent technology for a limited period. While this means you have the power to exclude competitors from lucrative markets, you can also choose to look for ways to allow your competitors to use elements of the patented technology – at a profit to the company.
Here are some tips to create a patent strategy that works for your company:
- Assess the value of new patent-worthy ideas during the development process. Conducting due diligence with the development of each new idea allows your company to be able to strongly pursue patents on ideas of value and ignore ideas with little quality, saving your company both time and money.
- Create patent peace. Cross-licensing your patent portfolio strengthens the portfolio’s overall value. Allowing portions of your patent portfolio to be used by partnering companies not only provides access to their portfolio but also strengthens your business relationship and helps avoid legal battles. This can simplify the research and development process for both companies.
- Look for value in unused patents. While a particular patent doesn’t have obvious value to your company’s existing strategy, it could mean something to someone else. Apply the “one man’s trash is another man’s treasure” saying to your portfolio strategy and you may see your IP property with new eyes.
- Gather your bargaining chips. If you are looking for investors or want larger companies to consider your business for acquisition, the strength of your patent portfolio can be an attractive feature of your overall business. The patents that help protect you in business can also be seen as insurance by potential investors.
Patent deals aren’t just for corporate giants. A strong patent is often the only thing protecting small, innovative companies from larger, wealthier competitors. You shouldn’t secure your protection and lock it away for the next 20 years. To get the most out of your investment, businesses need to develop a patent strategy that supports business objectives. Generating revenue from licensing fees can be a big part of that process.