page 1 berlin institute of technology expert group meeting on ip and sme geneva, sep 17th/18th...
TRANSCRIPT
Page 1
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Intellectual Property and IP Infringement –
Methodology and Results
of a Survey focusing on the German “Mittelstand“ (SME)
World Intellectual Property OrganizationGeneva, September 17th/18th 2009
Florian Köhler
Berlin Institute of TechnologyFaculty of Economics and Management
Chair for Innovation Economics
Page 2
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Background of the study and key questions
Methodology
Some results
Lessons learned and implications for todays workshop
Agenda
Page 3
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
• growing importance of intangible assets and the protection of intellectual property.
• at the same time growing (perceived) increasing threat of product piracy, counterfeiting, patent infringement…
• specific situation of SME (cost factors, low IP awareness, difficult enforcement, situation etc.)
• study commissioned by Federal Ministry of Economics and Technology, division “Patent Policy and Promotion of Inventions”
• timing: May to December 2008
Background and Key Questions
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Background and Key Questions
Key Questions
How has the importance of intellectual property changed over the last years?
How high ist the estimated impact on firm and economy level of IP
infringement (product piracy/counterfeiting)?
What are the implications for economic/innovation policy, especially with
respect to Small and Medium Enterprises in Germany?
Page 5
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Literature Review
• Analysis of existing related literature
• Consideration of both scientific papers, “grey” and “white” literature
Secondary Analysis
• Analysis of existing data (Community Innovation Survey, National Accounts etc.)
• Analysis of custom seizure data for estimations of counterfeiting)
Primary Analysis
• Written survey among both small and larger companies as well as patent attorneys
• Semi-structured interviews with experts and stakeholders etc
Methodology
Page 6
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Firm Sample:
around 3000 companies with at least 10 patents filings in 2002-2004
census survey among largest German companies plus random of sample firms with own research and development activities
additionally: participants in relevant conferences on counterfeiting
sampling bias towards patent-active firms (representativity limited!)
Attorney Sample
- 500 patent attorneys (intention was to have a „second opinion“ from outside the company itself; random sample drawn from German patent attorney database)
plus: semi-structured interviews with experts, trade associations, SME general managers etc.
Methodology – The Sample
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Methodology – The Sample
• around one third are SME (according to EU definition size criterion), around 50% with less than 500 employees
Sample Description by Size
Company Size (headcount)
No of companies
up to 49 employees 56
50 to 249 employees 52
250 to 499 employees 29
500 and more employees 158
Total 295
• Consideration of both large and smaller companies makes comparative analysis possible
• Focus on research active firms and IP users
• Oversampling of research active companies with high usage intensity of patents and trademarks
92,39%
88,19%
92,25%
53,85%
•20,10%
19,11%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
R&D activity
Use of patents
Use of trademarks
SampleCIS 4
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
• Method of data collection: Paper & Pencil plus online version
• 2 reminder letters plus reminders calls
• Incentive: Summary of main results (for firm benchmark)
• Mostly closed questions, with ordinal answer scales
Questionnaire structured in 3 modules according to research questions:
• Module A: Importance and Value of Intellectual Property, e.g.
• Importance of different IP protection methods (current situation and retrospective/prospective statement)
• Motives to patent (protection, blocking, licensing etc)
• Technology transfer (frequency and motivation for licensing)
Methodology – The Questionnaire
Page 9
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
• Module B: IP Infringement/Product Piracy/Counterfeiting
• Incidence and frequency of counterfeiting cases
• Geographical information on counterfeiting cases
• Enforcement Issues
• Monetary and Non-Monetary Impact of Counterfeiting
• Module C: Support Programmes in the field of IP
• Awareness and use of IP support programmes
• Barriers for usage and perception of support programmes
plus: standard company information (industry, employees, sales, cooperation intensity, function of respondent)
Methodology – The Questionnaire
Page 10
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Some results – The importance of formal IP protection
Importance and Change in Importance of formal IP protection over firm size
•0
0,5
1
1,5
2
2,5
3
3,5
4
4,5
Imp
ort
ance
Trademark
-0,8
-0,6
-0,4
-0,2
0
0,2
0,4
0,6
0,8
1
Ch
ang
e in
Imp
ort
ance
Patents CopyrightIndustrial Design
-1
Up to 49 employees 50 to 249 employees 250 to 499 employees 500 and more employees
Utility Model
TrademarkPatents CopyrightIndustrial Design
Utility Model
• Patents and Trademarks have high relative importance both in SME and in larger firms compared to other IP rights.
• Increase in the importance can be observed to a greater extent among larger size classes.
•Perception of utility models and copyright more equally distributed).
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Some results – The importance of informal IP protection
•For SME several informal/strategic ways of protecting IP have become more important.
•Lead Time Advantage and Staff Relationship were given growing importance.
•Larger firms also use implementation of technical solutions to deter counterfeiting / to protect their products from imitation.
Change in Importance of Informal/Strategic protection methods over size classes
-1
-0,6
-0,4
-0,2
0
0,2
0,4
0,6
0,8
1
Lead T
ime
Advanta
ge
Confiden
tialit
y with
Supplie
rs
Use o
f tra
de se
cret
s
Exclu
sive
Cust
omer
Rel
atio
nship
s
Imple
men
tatio
n of t
echnic
al s
olutio
ns
Emplo
yee
loya
lty/s
taff
rete
ntion
Confiden
tialy
with
sta
ff
Defen
sive
Public
atio
n Stra
tegy
Ch
ang
e in
Imp
ort
ance
Imple
men
tatio
n of m
anag
emen
t tools
Up to 49 employees 50 to 249 employees 250 to 499 employees 500 and more employees
Page 12
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Some results – Strategic use of patents
•Traditional protection motive plays most important role, but not to the same extent for the smallest companies.
•Strategic relevance of patents for SMEs in licensing motive and access to financing (patents as indicator for credit worthiness or collateral)
Strategic Use of Patents over size classes
0
0,5
1
1,5
2
2,5
3
3,5
4
4,5
5
Protection
Offensive Blocking
Differentiation against competitors
Defensive Blocking
Exchange Motive (Cross-Licensing)
Generating Licensing Income
Financing Motive
Imp
ort
ance
Up to 49 employees 50 to 249 employees 250 to 499 employees 500 and more employees
Page 13
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Some results – Frequency of Product Piracy
•Around 65% of the companies had experience with counterfeiting/product piracy
•Frequency increases with company size (higher activity abroad, more formal IP, more valuable brands)
•But more than 50% of SMEs with more than 50 employees also affected.
Frequency of Patent or Trademark Infringement over size classes
0% 20% 40% 60% 80% 100%
Patents
Trade-marks
Patents
Patents
Patents
Patents
up
to 4
9 e
mpl
oyee
s 5
0 to
249
em
ploy
ees
250
to
499
em
ploy
ees
500
+ e
mpl
oyee
s T
otal
Often or very often Seldom to Sometimes Never
Trade-marks
Trade-marks
Trade-marks
Trade-marks
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Umsatzeinbußen durch Produktpiraterie
0
10
20
30
40
50
60
0% 1-2% 3-5% 6-10% 11-15% 16-20%
Loss in revenue (2007)
Sh
are
of
co
mp
an
ies
(%
)Some results – The impact of IP infringement
Zusatzkosten durch Produktpiraterie
0
10
20
30
40
50
60
0% 1-2% 3-5% 6-10% 11-15% 16-20%
Additional costs in % of revenue (2007)
Sh
are
of c
om
pan
ies
(%)
Loss of revenue as a result of product piracy
Additional expenses as a result of product piracy
Loss of revenue and additional expenditure as consequence of product piracy •Loss of revenue in
the majority of cases under 5% of yearly turnover; but also 12.1% with losses of more than 10%.
•Monetary impact mostly around 1-2% of yearly turnover.
•Total monetary impact for companies is estimated to 6.2% of yearly turnover.
Page 15
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
-0,2
0
0,2
0,4
0,6
0,8
1
Cha
nge
in Im
port
ance
bis 49 Mitarbeiter 50 bis 249 Mitarbeiter 250 bis 499 Mitarbeiter 500 und mehr Mitarbeiter
Some results – The impact of IP infringement
Stronger use of informal protection
methods
Stronger use of formal protection
methods
Stronger Efforts in IP maintenance and enforcement
Breakup/Change in relations with
customers
Lower investment in production plants in critical markets
Lower sales activities in critical
markets
•Usage of informal protection methods is increasing in all size classes, large companies also ramp up formal protection methods like patents
•SME are at disadvantage since potential for higher IP maintenance and enforcment is not feasible for them.
Impact of product piracy on management decisions over firm size
Up to 49 employees 50 to 249 employees 250 to 499 employees 500 and more employees
Page 16
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Some results – Semi-structured expert interviews
• In general: Low IP awareness
• Most common complaint: time and costs of patenting / examination process, community patent subject
• With respect to IP support programmes: and information gap on existing IP support among many companies
• Lack of coordination between various support offers, e.g. those focused on research support and those focusing on IP topics
• Focus should shift from “patent promotion” to the advancement of IP management skills and IP exploitation
• IP education is the most important component (also in universities and secondary education)
Page 17
Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Lessons learned – Methodological Issues
• Combination of large scale survey and in-depth interviews very fruitful.
• Never underestimate the usefulness of pre-testing, especially among SMEs with possibly lower knowledge about IP topics!
• Include definitions of the phenomena (R&D expenditures etc.) under investigation.
• Refusal/unit non-response seem to be higher among entrepreneurs and SMEs than managers of larger companies (lack of time and interest): Keep it short and focused!
• The extra effort of „paper & pencil“ compared to „online only“ paid back with higher return rate.
• Try to ease concerns on releasing confidential information and design questionnaire accordingly to avoid item non-response.(categories for R&D expenditures instead of “naked figures”).
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Berlin Institute of Technology
Expert Group Meetingon IP and SME
Geneva, Sep 17th/18th
Discussion
Thanks for you attention.