patent strategies for small high-technology companies
DESCRIPTION
Patent Strategies For Small High-Technology Companies. By David M. O’Dell [email protected] 214.651.5262. Are you changing?. Intellectual Property Law. 1. Why IP is Important 2.What is a Patent? 3.Patent Strategies 4.Stories and Examples. - PowerPoint PPT PresentationTRANSCRIPT
Patent Strategies For Patent Strategies For SmallSmall
High-Technology High-Technology CompaniesCompanies
Are you changing?
ByByDavid M. O’DellDavid M. O’[email protected]@haynesboone.com214.651.5262214.651.5262
1.1. Why IP is ImportantWhy IP is Important
2.2. What is a Patent?What is a Patent?
3.3. Patent StrategiesPatent Strategies
4.4. Stories and ExamplesStories and Examples
Intellectual Property Law Intellectual Property Law
Intellectual Property Intellectual Property Core Corporate AssetsCore Corporate Assets
Intellectual Property Intellectual Property Core Corporate AssetsCore Corporate Assets
"In 1982... hard assets accounted for "In 1982... hard assets accounted for 62% of [a] company's market value; 62% of [a] company's market value; ten years later they made up only ten years later they made up only 38%. And these were the 38%. And these were the industrial's."industrial's."
Fortune, October 2, 1995Fortune, October 2, 1995
"In 1982... hard assets accounted for "In 1982... hard assets accounted for 62% of [a] company's market value; 62% of [a] company's market value; ten years later they made up only ten years later they made up only 38%. And these were the 38%. And these were the industrial's."industrial's."
Fortune, October 2, 1995Fortune, October 2, 1995
Uses of PatentsUses of Patents
• Create Barrier To Stop Create Barrier To Stop CompetitorCompetitor
– Priceline.com’s suit against Priceline.com’s suit against ExpediaExpedia
• Generate Licensing IncomeGenerate Licensing Income
– Priceline.com’s $1.5MM License Priceline.com’s $1.5MM License to Alliance Mortgageto Alliance Mortgage
• Defensive Cross-LicensingDefensive Cross-Licensing
1.1. Why IP is ImportantWhy IP is Important
2.2. What is a Patent?What is a Patent?
3.3. Patent StrategiesPatent Strategies
4.4. Stories and ExamplesStories and Examples
Intellectual Property Law Intellectual Property Law
What is a Patent?What is a Patent?
• Right to Exclude Others Right to Exclude Others • A Bargain Struck with GovernmentA Bargain Struck with Government• Claims Define the Right - “Metes and Claims Define the Right - “Metes and
Bounds”Bounds”• Competitors Have Right to Design Competitors Have Right to Design
AroundAround• Last for about 17 yearsLast for about 17 years
Invention Must Be Invention Must Be New and Non-Obvious New and Non-Obvious
• Not Patentable if Differences Between Not Patentable if Differences Between Prior Art and Invention Are “Obvious”Prior Art and Invention Are “Obvious”
• Easy to Show Non-ObviousnessEasy to Show Non-Obviousness– ““Person of Ordinary Skill” StandardPerson of Ordinary Skill” Standard– ““Manner of Making” Not a NegativeManner of Making” Not a Negative– ““Commercial Success” Supports Commercial Success” Supports
Non-ObviousnessNon-Obviousness
Level of ObviousnessLevel of Obviousness
0
50
100
Pioneering Crowded
Technology Saturation
Leve
l of O
bvio
usne
ss
Patentability of Telecom Ideas
Today
Examples of Patentable Examples of Patentable Subject MatterSubject Matter
• SoftwareSoftware• Signalling MethodsSignalling Methods• Business Methods (Telecom Services)Business Methods (Telecom Services)
• You You CannotCannot Patent Patent – Laws of Nature or Laws of Nature or – Abstract IdeasAbstract Ideas
0
5000
10000
15000
20000
250001990
1991
1992
1993
1994
1995
1996
1997
1998
1999
Patents Issued
Software Patents IssuedSoftware Patents Issuedby PTOby PTO
Signalling MethodsSignalling Methods
System for Controlling Usage
of Phone Debit Cards
Telecom ServicesTelecom Services
1.1. Why IP is importantWhy IP is important
2.2. What is a Patent?What is a Patent?
3.3. Patent StrategiesPatent Strategies
4.4. Stories and ExamplesStories and Examples
Intellectual Property Law Intellectual Property Law
Need For IP StrategyNeed For IP StrategyNeed For IP StrategyNeed For IP Strategy
””If small entrepreneurs want to If small entrepreneurs want to protect themselves, they better protect themselves, they better
get into the game.”get into the game.”Q. Todd DickinsonQ. Todd Dickinson
Acting Commissioner of PatentsActing Commissioner of Patents
””If small entrepreneurs want to If small entrepreneurs want to protect themselves, they better protect themselves, they better
get into the game.”get into the game.”Q. Todd DickinsonQ. Todd Dickinson
Acting Commissioner of PatentsActing Commissioner of Patents
Reasons for Building a Patent Reasons for Building a Patent PortfolioPortfolio
Attract Venture CapitalAttract Venture Capital Preserve Market ExclusivityPreserve Market Exclusivity Generate RevenueGenerate Revenue Defense Against CompetitorsDefense Against Competitors Increase Market CapitalizationIncrease Market Capitalization Generate PublicityGenerate Publicity
Right-to-Use and Clearance Right-to-Use and Clearance SearchesSearches
Check for any patents that will Check for any patents that will prevent you from entering the prevent you from entering the market placemarket place
Identify patent strategies of Identify patent strategies of competitorscompetitors
Identify design-around requirementsIdentify design-around requirements
1.1. Why IP is importantWhy IP is important
2.2. What is a Patent?What is a Patent?
3.3. Patent STrategiesPatent STrategies
4.4. Stories and ExamplesStories and Examples
Intellectual Property Law Intellectual Property Law
The Computer Wars The Computer Wars
Austin Computers
Compaq
Dell
Patent Patent
The Computer Wars The Computer Wars
Austin Computers
Compaq
Dell
Lessons LearnedLessons Learned
• The strategy of “we can do the same The strategy of “we can do the same thing, only cheaper” does not usually thing, only cheaper” does not usually work in a competitive environmentwork in a competitive environment
• Building a strong patent portfolio of Building a strong patent portfolio of your own enables cross-licensingyour own enables cross-licensing
• Strategic partners also enable you to Strategic partners also enable you to cross-licensecross-license
Centillion Data Systems Centillion Data Systems
Centillion
SprintAT&T
Patent
Centillion Data Systems Centillion Data Systems
Centillion
SprintAT&T
Lessons LearnedLessons Learned
• Developing a niche idea or an Developing a niche idea or an adjunct-type system can often be adjunct-type system can often be successful successful
• Acceptance and licensing by industry Acceptance and licensing by industry leaders (or by the general public) leaders (or by the general public) also serve to further validate your also serve to further validate your patentpatent
Stacker & Stacker & Windows Disk DoublerWindows Disk Doubler
Stac
Microsoft
Patent
Stacker 4.0 & Stacker 4.0 & Windows Disk DoublerWindows Disk Doubler
Stacker
Microsoft
Lessons LearnedLessons Learned
• Patents protect from encroachmentPatents protect from encroachment• Limiting your business to your Limiting your business to your
invention protects against cross-invention protects against cross-claimsclaims
Ball Semiconductor Ball Semiconductor
Patent Patent Patent Patent Patent
Lessons LearnedLessons Learned
• If you are entering a new, pioneering If you are entering a new, pioneering technology, a broad-reaching patent technology, a broad-reaching patent strategy adds value to your companystrategy adds value to your company– Modern example, nano technologiesModern example, nano technologies
Each of these companies Each of these companies announced an issued announced an issued patent and saw there patent and saw there stock take an immediate stock take an immediate jump.jump.
Tivo, Replay, & Tivo, Replay, & Amazon.com Amazon.com
Lessons LearnedLessons Learned
• Patents are valuable to investorsPatents are valuable to investors
ConclusionConclusion
• Big players typically have a strong Big players typically have a strong patent portfoliopatent portfolio
• Licensing and joint-venture can Licensing and joint-venture can provide some level of patent provide some level of patent protectionprotection
• Start patent process soonStart patent process soon• Even if Company fails, patents can Even if Company fails, patents can
still be a source of revenuestill be a source of revenue
Patent Strategies For Patent Strategies For SmallSmall
High-Technology High-Technology CompaniesCompanies
Are you changing?
ByByDavid M. O’DellDavid M. O’[email protected]@haynesboone.com214.651.5262214.651.5262