Why are Patents Important?
Intellectual properties like patents have emerged as one of the most significant corporate assets these days and if monetized prudently owners can generate additional revenues for themselves or for their companies. In other words, we can say is that by exploiting IPRs like patents, companies can completely foreclose the ability of others to manufacture the product, or the company can enjoy licensing revenues that the manufacturers are making out of that invention. Patents Important
The importance of patents could be understood with the simple fact that companies like IBM receive nearly $2 B USD/year in licensing revenue. Similarly, search giant Google makes $ 8000 M USD/year as licensing revenue. After having learned these figures no company can dare to neglect IPRs in this throat cut competition. All we can say is that patents are very important and companies should create, and nurture those practices that can help them create a sound portfolio of patents. Patents Important
With this article our main aim is to underline some facts that will describe why should companies bother about patents at all and how can they get benefitted out of them? So, without adding much let’s go through those points: Patents Important
Why are Patents Important?
Revenue source- As we discussed earlier patents can be used as one of the most important revenue sources to improve their bottom line. Viewing the fact, that most companies these days are under tremendous pressure to give maximum outputs from minimum inputs patents can immensely useful in getting relief out of this frustration. Since it is a one-time investment you can rest in peace that once you created an invention it will generate income recurring without having you to invest much of your resources. Patents Important
As an effective bargaining tool- Patents are used not only to gain injunctions against competitors but can also be used as an effective tool to convince a buyer that the patent is valuable and it worth a certain amount of money. In other words, we can say is that if you have some patent(s), you can bargain with your potential customers to get a specified amount of money that you deem you have invested in developing it. In case you don’t have patents you cannot bargain much and you are left at the mercy of the negotiator. Thus, patents can be used as an effective bargaining tool to put your points convincingly. Patents Important
As an Industry control/influence- Creating a niche in a specific domain is important these days. When millions and millions of companies are competing these days it is better to build your business clout that can help you secure a niche in your intended domain. Patents can be used as one of the most important tools to control a particular industry or create influence in a domain so that no third party can neglect and by-pass you. In other words, we can say is that under certain circumstances, blocking patents could be of immense use and it gives its owner control of the industry or product line related to that patent. Generally, such a broad claim is not granted patent these days but it can still be used to create a certain degree of business clout in a particular domain. Patents Important
As a defensive tool- Apart from being used as a tool to extract royalties, patents can also be used as a defensive tool to protect themselves from being sued by competitors. For instance, some companies may hold extremely lucrative patents with no intention of ever licensing or otherwise monetizing them. In fact, these patents are used by these companies to defend the company’s control over its products by preventing competitors from copying the key competitive features protected by the patents. Patents Important
Thus, we can say is that if you wish to dominate a particular market the best way would be to create a strong patent portfolio in the specific domain you intend to enter into. Hence, it is important for companies to keep building their patent portfolio so that they stay ahead in the race and should invest a significant part of their revenue in research and development work. Companies these days can create a patent monetization strategy of their own or can take assistance from a patent search firm that is well-equipped with patent regulatory norms.