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Archived updates for Tuesday, February 15, 2005

Why the "No-Brainer" Approach to I/P Doesn't Work

According to an article in the November 2004 issue of Chief Executive, experts estimate that 80 to 90 percent of corporations still don’t use IP as an offensive as well as defensive tool to block competitors, generate new revenue streams, or increase leverage with suppliers:
The effort to pull out of an IP strategic hole is significant, taking years and
committed resources. That might explain why many companies have
opted for a “no-brainer� approach of patenting everything in sight. But the
intelligence behind this type of fix is in short supply. Having many patents is
not necessarily a solution, says Ed Kahn, CEO of the Cambridge, Mass.-based IP
consulting firm EKMS. Starting in the late 1990s, this strategy became popular
as many CEOs read Rembrandts in the Attic: Unlocking the Hidden Value of Your
. They were taken with the prospect of found money in their filing
drawers and instructed corporate counsels to protect everything. But the results
largely backfired. “It’s usually velvet Elvises in the attic,� Kahn says. “In
large companies with extensive IP, sometimes 80 to 85 percent [of patents] are
nonpracticed. They neither protect company products nor license to anyone else.
R&D goes one way, the strategic marketing group goes another, and before
long you’ve got a lot of underutilized or unused patents.�
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