The Importance of IP Strategy
An IP strategy is becoming increasingly important across the full spectrum of industrial sectors and companies, both in Australia and globally. As a consequence, it is important not only for CEOs but for all involved in Intellectual Property development within a company to formulate strategies for managing that company’s intellectual property assets. Developing an appropriate IP strategy allows for maximal utilization of these assets in aiding the company to realise its goals. Indeed, IP strategy has become an integral part of corporate strategy.
As defined by on the Australian Government IP website, ‘IP is the property of your mind or proprietary knowledge. It is a productive new idea you create. This can be an invention, trade mark, design, brand or even the application of your idea.’
Hence IP covers a range of products, used in differentiating one business or company from another. IP can be a significant percentage of a business or company’s total asset value – for many companies and businesses, the value of their IP assets can be worth more than the value of their physical assets. This is reflected in the number of applications made for patents within Australia.
“Over the last 10 years, it has become imperative for CEOs to have not just a general understanding of the intellectual property issues facing their business and their industry, but to have quite a refined expertise relating to those issues… It is no longer simply the legal department’s problem. CEOs must now be able to formulate strategies that capitalize on and maximize the value of their company’s intellectual property assets to drive growth, innovation and cooperative relationships with other companies”
Microsoft Chairman, Bill Gates to Chief Executive Magazine.
Just as IP covers a range of products, consequently there exist a range of IP rights. The primary forms for IP protection are patents (utility and design), trade marks and copyrights. For example, an invention is protected by a patent; the appearance of the invention is protected by design registration. A registered Trade Mark will protect the distinctive aspects by which an IP distinguishes a business from others (such as names, logos, symbols, even colours or scents). Australia also provides plant breeder’s rights. As a company grows and evolves so does the importance of IP; IP strategy is therefore a continuous process of review and decision-making.
IP and the Australian Patent
In Australia, IP rights are secured by a broad range of industry sectors, as the scope of technologies which can now be protected continues to grow. The companies comprising the top 10 patent applicants in Australia over the past few years ranges from gaming to healthcare to computer software.
Per the table below, only 1 of these top 10 companies is Australian-based (Aristocrat Technologies Australia). The Australian economy remains open not only to foreign investment, it provides a market for foreign companies to actively participate and compete with local companies. Australia’s well established IP laws and experience juridical system further attracts those companies who are right holders.
|Aristocrat Technologies Australia||274||133||85||147|
|General Electric Co||233||177||150||93|
|Samsung Electronics Co||159||366||292||321|
|Halliburton Energy Services||150||226||358||590|
Number of patent filings of top 10 Patent Applicants in
Australia in 2012 from 2012 to 2015.
Source: IP Australia records
Over the past decade the nature of competitive advantage has changed, as has the global economy. Intangible knowledge assets have become as important, if not more so, than traditional tangible, or physical, assets. Where tangible assets were once responsible for the bulk of a company’s wealth, total market capitalisation is becoming increasing represented by intangible assets, such as patents, copyrights and trade marks.
Hence the importance of conducting an audit of existing IP materials as part of a company’s IP Strategy. The eclectic range of the top 10 companies applying for patents in Australia has changed little over the past few years – they have all consistently filed for a large number of patents per year, reflecting the importance of an IP strategy to the growth of success of their companies.
What’s Your IP Strategy?
Who do you talk to? Who can you trust? In the global economy of the 21st century, a clear strategy to identify and then protect your intellectual assets is more important than ever before. Talk to us about putting a commercially relevant plan in place to minimise risks to your assets.