Archive for Intellectual Assets
Invisible Innovation: The Blindness of the West to China’s Innovation Story
Posted by: | CommentsMaybe China is just too far from the smug innovation circles of the West. Maybe language and cultural barriers make the events unfolding in China too inaccessible to Western media. Maybe decades of concern about IP theft from Chinese companies has closed the eyes of the West to present realities. Whatever the reason, the West today seems generally blind to the innovation powerhouse that China is becoming. Witness, for example, the highly publicized list from Reuters-Thompson of the top 100 global innovators, based on “patent activity.” With China having become one of the world’s true hotbeds of patent activity, not to mention economic impact with innovation in many fields, one might expect Chinese institutions to be well represented on the list. Incredibly, the list has ZERO Chinese entities on. None from Mainland China, none from Taiwan, and none from anywhere else in Asia except for a heavy dose of Japanese companies (27) and 4 from South Korea. Tiny Switzerland makes the list 3 times, and its minute neighbor, Liechtenstein, makes the list with Hilti Corporation. But zero from China and Taiwan? The list is related to “patent activity,” but its compilers wisely recognize that patent volume alone is a poor metric for innovation. Instead, they have created other metrics based on patent data:
The Thomson Reuters 2011 Top 100 Global Innovators are companies that invent on a significant scale; are working on developments which are acknowledged as innovative by patent offices across the world, and by their peers; and, whose inventions are so important that they seek global protection for them.
Sounds fair. So sure, the manufacturing and supply chain innovation that has been a big part of China’s economic rise are not expected to make a showing on this list. That kind of innovation doesn’t show up in terms of granted US and European patents. And the tendency for many Chinese companies to mostly file patents in China doesn’t help them with the methodology Thompson Reuters has, which looks for measures of international impact and international patents. But did they miss all the international activity of some Chinese companies? For example, a couple of days before this list of innovators came out, I posted this on LinkedIn and Twitter (@jefflindsay):
Two Chinese companies, ZTE and Huawei Tech., are among the top 5 international (PCT) patent applicants. Lots of IP here! http://is.gd/t2tUb4
OK, so Thompson Reuters doesn’t follow me, but these companies should have shown up strongly in their patent searches. These are innovative companies with products marketed internationally, having strong economic impact, and loads of patents. Being in the top 5 for international filings wasn’t good enough to even place in the top 100 for Thompson Reuters. Huh? OK, it turns out the ZTE’s surge in patent filings is recent and their numbers prior to 2010 were probably too low to make the cut for this study–that’s fair. But Huawei had 445 US patents from 2005 to 2010, a number in greater than some other companies on the list. For 2011, by the way, Huawei isn’t just in the top 5 so far–they are Number One, the world’s leader in international patent filings (see the Nov. 2011 article in the Vancouver Sun). Think they’ll be on the next list of leaders in patent activity Thompson Reuters publishes? Perhaps, who knows?
How about the Liechtenstein firm that’s in the Top 100, Hilti AG. Heard of them? They have good products for the construction and building maintenance industries such as hammer drills and other tools. They have 20,000 employees, including 2,500 in the US, and market products and file patents internationally. For the 2005-2010 time frame of the Thompson Reuters study, Hilti had 327 patents. Not bad. Well below Huawei’s score, but still respectable.
Now let’s consider a little company that was not on the list: Foxconn. Heard of them? They have over 1 million employees and are the world’s largest producer of electronic components, including circuit boards. They are the ones who actually make Apple’s products such as the iPhone and iPad. This Taiwanese/Chinese firm (China considers Taiwan to be part of China, and much of Foxconn’s work is in China) is arguably the real powerhouse behind the success of Apple and several other companies on the Thompson Reuters list. Foxconn builds Apple’s products, and not just as a mindless executor, but as an innovative partner.
Ah, but what about real technological innovation expressed in patents? Surely Foxconn is just about cheap labor and low cost manufacturing, right? A quick search of Foxconn patents granted in the US from 2005 to 2010 shows they have over 700 patents. Some are design patents, but the vast majority are technological. Foxconn apparently is conducting serious R&D and spending millions on patents to find new ways to make leading edge high-tech products better, safer, faster, and cooler (both in terms of heat management and the “wow” factor). I have the privilege of interacting with some Foxconn people and from what I’ve seen and heard I can say that they have a world-class IP program to support innovation, and I feel that they are way ahead of many Western companies in these areas. Foxconn innovation and Foxconn IP may be the real key to Apple’s success. Foxconn innovation is abundantly expressed in patents, not just trade secrets and know how, with an estate twice as big as Hilti’s over 2005-2010 and an economic impact on the global market far in excess of Hilti. But Foxconn doesn’t make the list. How do none of these Chinese companies break into Thompson Reuters’ Top 100? Did they miss the 2010 story, “China Poised to Become Global Innovation Leader,” based on patent activity? That must be from another source they don’t follow.
Nov. 24, 2011 Update: My search on Foxconn patents needs to be updated. Yes, Foxconn has an impressive 700+ US patents for the 2005-2010 period, more than some companies in the TR list. But my search was deficient, failing to consider that many Foxconn patents might have been filed under the real name of the company that owns Foxconn, Hon Hai Precision Industry Co., Ltd. So I expanded my search term to be “Hon Hai Precision” or Foxconn. Now, instead of 700 patents, we’re looking at a massive estate of 5,872 US patents (perhaps a couple dozen more when typographical errors are considered). This estate now dwarfs MOST of the companies on the list such as Brother Industries (2873, searching for Brother Ind* or Brother Kogyo), BASF (2771, searching for BASF or Bayerische Akt*) Goodyear (1152), ABB (948), Airbus (926), Avaya (<600), Arkema (205), Cheil (116), etc. Oh, and what about innovation giant Apple Compute? A search for simply "Apple" (which might include some smaller companies unrelated to Apple Computer) returns 1809 issued US patents from 2005 to 2010, less than 1/3 of the US patent activity of the invisible innovator that makes Apple what it is.
Let’s return to Huawei for a moment. There should be little doubt about the innovation prowess of Huawei, even though they tend to be far more secretive and do much less P.R. than Apple. But this telecom company is big (with over 100,000 employees, they connect 1/3 of the world’s cell phones) and highly innovative. Read, for example, BBC’s story, “Innovation in China: Huawei – the secretive tech giant.” Maybe the Thompson Reuters methodology docks them for being on the young side. Over half of their 445 US patents from 2005 to 2010 came in 2010–but they still clearly outpace Hilti and others over the 5-year span of the study. So what gives? I suspect that the youthfulness of the estate means there has been less time for others to cite Huawei patents, and that may be part of the problem since patent citations are part of the methodology. But to miss Huawei completely?
Thompson Reuters will surely argue that their methodology was developed and implemented fairly, even blindly (a fair term), but someone should have immediately seen that something was wrong if top international filers and innovators like Huawei, and Foxconn didn’t make the list. But when it comes to innovation, innovation in China tends to be largely invisible to Americans, who are stuck in the old paradigm of US being the innovation leader and China just being a copier. That kind of blindness will catch the West by surprise in the very near future when US companies find themselves facing numerous patent barriers from the Chinese companies that will own much of the most valuable IP. China is creating and will create much of the most important global innovation for the future. Innovation needs to ramp up in the West in order to not be left completely behind.
Dec. 8 Update: Chinese computer giant Lenovo, the world’s 2nd largest producers of personal computers, may also deserve to be on the list.
Related stories:
- IAM Blog: “The US, Japan and France dominate new listing of the world’s most innovative companies“
- Nielsen.com: “Nielsen China Forum: Dispelling the Myths of Innovation in China“
- China Law Blog: “Innovation In China. It’s Happening, But Not How You Think“
- Tech Crunch: “Thomson Reuters Names ‘Top 100 Global Innovators’“
Why Smart Startups File Patents
Posted by: | CommentsStartup companies, unlike our “too big to fail” banks, can’t afford to make too many Enormous Mistakes without perishing or losing much of their value. One of the Enormous Mistakes that some startups make is neglecting intellectual property. That includes neglecting opportunities to protect their business, as well as the need to make sure they aren’t infringing other patents. These are separate issues and require separate efforts and tools. Some of the common mistakes and misconceptions of startups regarding IP are addressed in the slideshow presentation below, “What Do Startups Need to Know about Patent Law” by Jeffrey Schox.
An important point that Schox makes is that reasons smart startups file patents aren’t necessarily because they expect to license their technology or successfully sue a competitor. But having an issued or pending patent with some degree of quality is essential for attracting investor support. Investors typically expect a startup (in many fields, at least) to have IP that can be of value to the business for many years to come and can help limit the harm of competitive copying. Without that in place, that startup is much less likely to get the funds needed to thrive.
Patents play different roles at different stages in the life of a company. But neglecting IP at any stage is an Enormous Mistake that can lead to extinction.
Ask the leaders of a business how much they spend on printing. The response can be interesting, even hilarious. It’s an expense that is easily overlooked yet can be substantial. Few companies know if they are being overbilled. Decisions may be handled by cloudy processes where influences other than quality and value sometimes hold sway. Indeed, the fundamentals of the procurement process in many companies leave inefficiency if not outright abuse. The problem isn’t just in printing, either. Many parts and services handled through standard procurement systems can result in excessive costs. Enter an interesting business model innovation: E-Lynxx. For added spice, we’re talking patented business model innovation. Yes, E-Lynxx has a business model enhanced with the aura of two US patents.
William Gindlesperger is the founder and CEO of E-Lynxx. My source tells me he has over 25 years of experience in the printing industry, where found that the decision making process was antiquated and left companies vulnerable in many ways. He pursued business model innovation to come up with a system that could make the process transparent and more efficient. Under his business model, be provides software and services up front at not cost, getting paid only when the client saves real money from his work. Then he gets a cut of the savings. Low risk.
When a company turns to E-Lynxx, they receive software and training in how to use E-Lynxx’s open auction system. Bids are offered to a large array of qualified vendors who then bid on the deal. The vendors can see the competitive bids and so can the client. This transparency helps bring costs down substantially, often reducing print costs by 25-50%. E-Lynxx gets part of the savings. What’s not to like? Well, those who aren’t getting as much gravy might not like it, but if it’s your business, these kind of cost savings should be welcome news.
Here’s claim 1 of E-Lynxx’s first patent, 6,397,197, assigned to the CEO and founder himself:
1. A method for competitive bidding by print information product vendors comprising steps of: inputting a plurality of vendor records into a storage of a general purpose computer, each of said vendor records having a data field identifying a print information product vendor and a buyer identification data field identifying a buyer that said vendor is associated with, at least one of said vendor records having a vendor capability data representing a set of vendor manufacturing capabilities of the vendor identified by said record; inputting a buyer’s invitation-for-bid data into said general purpose computer, said buyer’s invitation-for-bid data having a buyer identification data, and having an invitation for bid on a print information product job from said buyer; calculating a vendor requirement data from said buyer’s invitation-for-bid data, said vendor requirement data representing a set of vendor manufacturing capabilities required for performing said print information product job; comparing said vendor requirement data to a plurality of said vendor records having a buyer identification data field identifying the buyer from which said buyer’s invitation-for-bid data was received; identifying at least one vendor record as qualified, based on said comparing; transmitting a vendor’s invitation-for-bid data based on said buyer’s invitation-for-bid data to each vendor identified by said at least one vendor record; inputting into said general purpose computer a plurality of bid data, each from one of said vendors to which said vendor’s invitation-for-bid data was transmitted, each of said bid data representing a bid price; identifying a bid data from said received bid data having the lowest represented bid price; outputting a selected vendor data representing the identity of the vendor corresponding to the bid data identified by said identifying step; and transmitting an order to the vendor represented by said selected vendor data.
Here’s claim 1 of their second patent, US 7,451,106:
1. A method for facilitating a buyer’s selection of a vendor via automated comparison of records and bidding by vendors of customized goods or services via a computer operated system, comprising steps of: prior to receiving job data from a buyer pertaining to a job for which the buyer seeks a vendor, receiving electronic communications from a plurality of vendors, the electronic communications being used in establishing a plurality of vendor records which are stored in an electronic memory associated with the computer system, the vendor records corresponding to each of a plurality of vendors and having vendor capability data identifying a plurality of capabilities for said vendor to provide a customized good or service; each buyer using the system generating an electronic communication providing information identifying a plurality of vendors for inclusion in a pool of vendors associated with said buyer to potentially receive a job solicitation, wherein the system stores electronic data sufficient to identify every vendor pool and its association with a corresponding buyer based upon the buyer transmitted vendor pool identification information which occurs prior to analysis of job data pertaining to a job for which bids are sought by or on behalf of the buyer; receiving an electronic communication defining a job data from or on behalf of at least one buyer, after said buyer’s vendor pool is determined, said job data including a job descriptor data which specifies a plurality of characteristics of said customized good or service for which said buyer wishes a bid; automatically comparing via a computer processor said vendor records to said job data, wherein said comparing includes comparing said plurality of characteristics for said customized good or service with corresponding plural capabilities for vendors from the pool of vendors associated with said buyer; automatically identifying via a computer processor at least one subset from the buyer’s associated pool of vendors as qualified for receiving the solicitation, based on said comparison; thereafter transmitting the solicitation to only selected members from the identified subset of the buyer’s associated pool of vendors; receiving bid response data from at least one of said vendors which received said solicitation, said bid response data identifying each of the vendors from which it was received and a bid price; and outputting to said buyer an electronic communication providing at least one of said bid response data.
And here’s claim 1 of 7,788,143:
1. A method for facilitating a buyer’s selection of a vendor via automated comparison of records and bidding by vendors for customized goods or services via a computer operated system, comprising the steps of: prior to processing job data from a buyer pertaining to a job for which the buyer seeks a vendor, receiving and processing electronic communications from a plurality of vendors, the electronic communications being used in establishing a plurality of vendor records which are stored in an electronic memory associated with the computer system, the vendor records corresponding to each of a plurality of vendors and having vendor capability data identifying a plurality of capabilities for said vendor to provide a customized good or service; receiving an electronic communication from or on behalf of any buyer using the system which provides information identifying a plurality of vendors for inclusion in a pool of vendors associated with the buyer to potentially receive a job solicitation, and storing electronic data sufficient to identify every vendor pool and its association with a corresponding buyer based upon the received electronic communications from the buyers providing vendor pool identification information, the vendor pool identification information being processed prior to analysis of job data pertaining to a job for which bids are sought by or on behalf of the buyer; receiving an electronic communication defining a job data from or on behalf of at least one buyer after the buyer’s vendor pool is determined, the job data including a job descriptor data which specifies a plurality of characteristics of said customized good or service for which the buyer wishes a bid; automatically comparing via a computer processor said vendor records to said job data, wherein said comparing includes comparing said plurality of characteristics for said customized good or service with corresponding plural capabilities for vendors from the vendor pool of vendors associated with the buyer; automatically identifying via a computer processor at least one subset from the buyer’s associated pool of vendors as qualified for receiving the solicitation, based on said comparison; thereafter transmitting the solicitation to only selected members from the identified subset of the buyer’s associated pool of vendors; receiving bid response data from at least one of said vendors which received said solicitation, said bid response data identifying a bid price for the corresponding vendor; and outputting to said buyer an electronic communication providing at least one of said bid response data.
Another patent is still pending.
Business method patents are still alive and can play important roles in some companies. Whether they are needed or not for this company, I like the innovative approach that E-Lynxx is taking to bring the procurement process into the light where more efficient transactions can occur with large costs savings.
Ramping Up External Innovation Fatigue
Posted by: | CommentsWithout wishing to be political, I have to say that I am worried about the future of innovation in light of “external innovation fatigue factors” that arise when government creates imposing barriers for innovators, especially for small businesses and lone entrepreneurs. As we note in Conquering Innovation Fatigue, the problem is often one of unintended consequences from well-intended actions. In the past several years, there has been an acceleration in regulatory burdens, tax burdens, and litigation risks that make starting or running an innovative business riskier than ever. Mounds of cash have been taken from the private sector and given to government agencies and large institutions for so-called stimulus or bailouts, but the real cost of such “help” is rarely considered. We see failed organizations on life support and may be happy to hear of thousands of jobs in these firms that appear to be saved, but we don’t get to see and consider the small businesses that dry up due to the money that was channeled elsewhere or that face the burden of unfair competition from failing institutions shielded from the consequences of their less competitive business models.
We see many leaders calling for even higher taxes on those who are (or would have been) most likely to create jobs and launch businesses. We see government making it more difficult and costly to obtain the energy that is literally and figuratively the fuel of our economy. We see US corporations facing burgeoning regulations regarding environmental issues, hiring practices, benefits, etc., that are not found in the nations we import from, with the natural consequence of punishing those who wish to produce in the US and motivating them to close shop here and go elsewhere. We see increased government intervention at all levels of the private sector, often favoring the large and well connected while leaving the lone innovators and start-ups in the dust, strangled with red tape and choking with uncertainty about the future. Meanwhile, property rights, including intellectual property, are increasingly in jeopardy. This is the stuff of “external innovation fatigue.” It’s been bad for years, and it’s accelerating now at a dangerous pace.
Those who wish to launch new businesses and reap the rewards of their innovation can still succeed, but need additional help and caution in moving forward and finding the right partners, business models, and approaches to reduce the risks and create lasting competitive advantage that can survive the billowing waves of external fatigue factors. We offer guidance in the book on these issues, including the need to be more holistic in pursuit of intellectual property, taking the path that we call 360-degree intellectual assets. Thinking about patents exclusively can lead to excessive costs and disappointments. I suggest reading carefully our recommendations on holistic intellectual assets and giving us a call for further guidance. Innovationedge can be reached at 920-967-0466.
Startups and Patents: New Study Sheds Light on Practices and Reasons for Filing
Posted by: | CommentsThe recently published Berkeley Patent Survey is one of the most comprehensive studies to date on the use of patents by startups and entrepreneurs. PatentlyO discusses the study and offers some helpful insights. The study shows that startups are using patents more than was previously recognized, for past analysis based was limited by incomplete USPTO data on patent assignments. Search results for patents owned by a particular startup may miss the patents owned by founders and others that are being used by the startup but may not yet be listed in the USPTO database as being assigned to the company. By interviewing entrepreneurs, the authors were able to determine that:
[A]bout 40% of our respondents hold patents or applications, with the figure rising to about 80% for startups funded by venture capital firms.
As expected, this figure varies widely by industry—for example, 97% of venture-backed biotechnology companies hold patents or applications, while only 67% of venture-backed software startups do. And among the general population of software startups responding, the rate was only about 25%.
–From Robert Merges and Pamela Samuelson, UC Berkeley School of Law and Ted Sichelman, University of San Diego School of Law, in “Patenting by Entrepreneurs: The Berkeley Patent Survey (Part I of III),” PatentlyO.com, July 19, 2010.
In our experience, many of the best startups take IP seriously and seek to file patents when they have something potentially patentable. In our experience, Venture Capitalists look for patents as a way to increase the chances of meaningful returns. Patents are an important part of the recipe for success and long-term profits for a startup. Don’t neglect them!
Amyris: Great Story of Open Innovation and Renewable Products
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In my ongoing work on analyzing the intellectual property landscape in biofuels, one of the most impressive companies I’ve run across is Amyris, a renewable products company whose clever use of synthetic biology goes far beyond biofuels. Amyris was founded by Kinkead Reiling, Neil Renninger, and Jack D. Newman who met at Berkeley and founded Amyris in 2003, headquartered in Emeryville, California. With a grant from the Bill & Melinda Gates Foundation, they first developed their technology under a non-profit initiative to provide a reliable and affordable source of artemisinin, an anti-malarial therapeutic. It was viewed as a long-shot, but they found success that paved the way for the growth of the company into other areas. They are now developing new microbial strains that can produce other useful molecules from renewable feedstocks. This industrial synthetic biology platform is providing alternatives to a broad range of petroleum-sourced products. he extremely useful molecule farnesene is an important part of their business. It provides a compound that can be used to produce flavors, perfumes, detergents, cosmetics, biodiesel, and other products.
This week Amyris created a stir by announcing a record number of deals and partnerships for a single week (a record among bioenergy companies, according to Biofuels Digest). These partnerships include P&G, Total, Soliance, Cosan, M&G Finanziaria, and Shell:
Amyris has taken it up a notch with a series of stunners surrounding its synthetic farsenene, which it has named Biofene – the first product that Amyris is seeking to produce at commercial scale.
Beyond its success this week with Biofene announcements, which are the basis for the P&G, M&G and Soliance partnerships — there are the broader arrangements with Cosan to develop a platform in renewable chemicals, and the equity agreement with Total that will provide needed capital as well as a broader platform for Amyris’s expansion into hydrocarbon fuels.
The mysterious agreement with Shell, regarding diesel, is one to watch. The decidedly vague disclosure was buried in Amyris’ amended S-1A registration statement, but not otherwise mentioned in a flurry of press releases from the company as it promotes its expansion in this pre-IPO environment. Shell Western Trading & Supply is one of 17 Shell trading companies that buy and sell to customers within and outside of Shell.
This news shows an interesting example of companies forming partnerships with an innovative start-up with great technology and apparently highly valuable IP. According to my Patbase search, Amyris has 21 patent families, quite a large number for such a young company. They clearly have been active and aggressive in pursuing patent protection, and those patents are critical for the meaningful partnerships they are now forming. It’s a great unfolding story of open innovation and technology transfer.
The story extends beyond the US. They have operations in Brazil, for example, which is one of the world’s hotbeds for bioenergy, bioproducts, and collaborative innovation.
Further information comes from today’s article, “Amyris: farnesene and the pursuit of value, valuations, validation and vroom,” also from Biofuels Digest.
Weakened IP Rights as an Innovation Fatigue Factor
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Weakened IP Rights: An Innovation Fatigue Factor
Innovation fatigue due to inadequate intellectual property rights and property rights in general occurs in many other nations today, and is strongly correlated with economic difficulty in such nations. Hernando de Soto, a Peruvian economist and winner of many awards such as the 2006 Innovation Award from The Economist for the promotion of property rights and economic development, has shown that lack of property rights has been a key factor in keeping poor nations poor. It is respect of property rights that creates the means for men to be equal in opportunity. Intellectual property rights are part of that, and when they are in jeopardy, we should be concerned.
In Brazil, for example, a nation with tremendous potential for further economic development, recent government actions related to a trade dispute with the US over cotton threaten to reduce the value of US patents held by people in Brazil. In “Brazil Close to Declaring War on US IP” over at IAM Magazine, we read about the dangerous actions being taken by the Brazilian government. There may be many long-term costs for whatever short-term gains they obtain. This could harm innovation and economic development in that nation.
One example in the US of the attack on patent rights comes from the recent court case Association for Molecular Pathology v. USPTO in which a body of patents obtained by Myriad Genetics (NASDAQ:MYGN) has been declared invalid by a judge using dubious arguments presented by the ACLU. I am especially troubled that the patents were declared invalid for not treating patentable subject matter under 35 U.S.C. § 101.
Eric Guttag over at IP Watchdog offers some convincing arguments about the absurdity of the ACLU’s position and the injustice of Judge Sweet’s rulings. Please read the full article, “Foaming at the Mouth: The Inane Ruling in the Gene Patents Case.” Here is one excerpt:
What is most alarming about Judge Sweet’s opinion is his characterization (or more appropriately mischaracterization) of the CCPA’s Bergy case. Judge Sweet makes numerous quotes from Judge Rich’s opinion in Bergy on how 35 U.S.C. § 101 should be interpreted. But what Judge Sweet neglects to point out is that Judge Rich ruled in Bergy that a biologically pure culture was deemed to be patent-eligible under 35 U.S.C. § 101. Why did Judge Sweet neglect to point out this highly relevant fact? Instead, if the holding in Bergy is considered in appropriate context, it supports Myriad’s “isolated” BRCA1 and BRCA2 gene sequences as being at least patent-eligible under 35 U.S.C. § 101 because they don’t exist in nature and cannot exist without significant human intervention. . . .
In the end, it is my considered opinion that Judge Sweet knew the result he wanted to reach (i.e., invalidate Myriad’s patents), and simply cobbled together a justification for it. (Treating the claims in Myriad’s patents are a “lawyer’s trick” also doesn’t suggest impartiality.) If nothing else, there is enough of a dispute about the essential facts needed to reach Judge Sweet’s conclusion to deny the plaintiff’s motion for summary judgment of invalidity based on 35 U.S.C. § 101. That Judge Sweet needed to spend 152 pages trying to justify his grant of plaintiff’s motion for summary judgment speaks volumes about why this grant was inappropriate.
At many levels in the US and in other nations, there seems to be an increasing hostility toward patents and intellectual property rights for inventors. One of the best things that can be done to stimulate the economy right now would be to strengthen the USPTO, reduce examination time, and instill a healthy respect in the judiciary for property and intellectual property rights. Adding to the uncertainty, cost, and delay of patent protection only weakens the economy, and hinders innovation through yet another “innovation fatigue factor.”
GotInvention Radio: Listen This Thursday Night, and Next
Posted by: | CommentsOne of the real champions of innovation and entrepreneurship, Brian Fried, has created a successful new radio program to meet the needs of inventors and entrepreneurs: Got Invention Radio at GotInvention.com. It’s a one-hour show every Thursday night at 7:00 p.m. CST (if you’re in China or Singapore, for example, that should be 8 a.m. Friday morning–the perfect way to start your day!) I’m the next guest this Thursday night. I’ll be speaking about intellectual property, with practical tips for inventors who want to get quality patent protection. There are some pitfalls to avoid and some tips you need to know about. A quality patent can make all the difference for the long-term success of a product or business, so tune in and join the conversation.
At least two callers will receive free copies of the book, Conquering Innovation Fatigue. Please mention this blog when you call!
Go to Gotinvention.com/shows and click on the green area in the upper right-hand portion of the screen to launch your media player and listen. To be a caller, dial 877-474-3307. Please join us this Thursday night, March 18.
The following week, March 25, you can hear Cheryl Perkins, CEO of Innovationedge. Don’t miss that one, either!
When Inventions Are Ahead of Their Time, Long-Term IP Strategy Becomes Essential
Posted by: | CommentsAs an inventor and US patent agent, one of my painful experiences in the pursuit of patents at past employers and on my own has been unexpected encounters with prior art. Even after serious and careful searching, one may later find that someone else pursued a very similar idea many years ago. Like the Good Book says, there is no truly novel thing under the sun, though there may be many nonobvious improvements thereof.
A great example of this is the iPod, an invention and innovation that may have been anticipated to some degree in 1979. “Suspiciously Prescient Man Files Patent for iPod-Like Device in 1979” is Dan Nosowitz’s recent post at Gizmodo pointing out how an old, expired patent hinted at several aspects of the iPod. Of course, music players and MP3s were already around when the iPod came out, but the 1979 data is rather surprising. That patent may have had some great concepts, but like many inventive concepts, it may have been too early to be practical and successful. Timing is so important for success in innovation: is the market ready, is the supply chain available, is there an ecosystem that can be tapped, can the concept stick and resonate with other innovations, and can it be offered economically?
Consideration of the market roadmap for a prospective innovation can be critical for success. Many times success requires adjusting the business model to find the resonances that can add energy to the offering and to find ways to present the innovation in a disruptive manner rather than going head-on against established incumbents. Innovation is often more about the business model and marketing plan than it is about the technology itself. The iTunes model was part of what made the iPod a winner. 1979 was the wrong digital era for that invention. (A hat tip to RobMcNealy on Twitter for a mention of the Gizmodo article.)
Another example of an invention ahead of its time was the photophone of Alexander Graham Bell. About.com’s article on Mr. Bell explains:
Among one of his first innovations after the telephone was the “photophone,” a device that enabled sound to be transmitted on a beam of light. Bell and his assistant, Charles Sumner Tainter, developed the photophone using a sensitive selenium crystal and a mirror that would vibrate in response to a sound. In 1881, they successfully sent a photophone message over 200 yards from one building to another. Bell regarded the photophone as “the greatest invention I have ever made; greater than the telephone.” Alexander Graham Bell’s invention reveals the principle upon which today’s laser and fiber optic communication systems are founded, though it would take the development of several modern technologies to realize it fully.
One of the challenges with visionary inventions is obtaining suitable intellectualy property. Patents expire in 20 years from the filiing date, which may not be enough to do any good when a visionary concept finally becomes economically viable. The IP estate must be developed with a broad time frame in mind and should include elements that last longer than patents such as trademarks, as well as a series of patent applications over time that reflect ongoing innovation and competitive awareness. Strategy and vision in the IP can be almost as important as the vision of the invention itself.
Disruptive Intellectual Assets: New Article Published in JPIM
Posted by: | CommentsThe latest Journal of Product Innovation Management (JPIM), an excellent journal from PDMA for those interested in innovation and new product development, has an article that describes an approach to disruptive innovation that we developed at Kimberly-Clark Corporation when I was there as Corporate Patent Strategist. “Disruptive Innovation and the Need for Disruptive Intellectual Asset Strategy” by Jeff Lindsay and Mike Hopkins (JPIM, Vol. 27, No. 2, March 2010, pp. 283-290), addresses one of the large gaps in the literature around disruptive innovation, namely, what role intellectual assets should play. Search through the popular books and articles by leading authorities in disruptive innovation and you will find scant reference, if any, to intellectual assets, yet they may be key to overcoming the dilemma faced by corporations. A small, aggressive team in a corporation can employ a variety of low-cost intellectual asset (IA) tools to mitigate potential competitive threats from disruptive innovation, while also subtly laying a foundation for future offensive disruptive innovation from the company. By the time the corporation as a whole recognizes the value of an emerging disruptive innovation, it need bot be too late, as is often case, for the initially defensive actions that were taken at an early stage can now provide a serendipitous foundation for taking the offense. It’s not easy, but the odds of success or survival can be significantly increased.
Here is our abstract:
Disruption has become a popular business term, yet it is often used so loosely as to convey almost nothing of substance. Here a largely neglected factor is addressed: the role of intellectual assets in securing opportunities for or averting threats from disruptive innovations. While the literature explains why the decision-making systems in large established companies cause difficulty in responding effectively to disruptive innovation the generation of intellectual assets (e.g., patents, publications, trademarks) typically is not subject to the same cultural and structural barriers. Though it may be difficult to convince a business to invest millions in pursuit of a speculative disruptive innovation, it is much easier for a small team to gain support in pursuing low-cost intellectual assets in the name of mitigating potential threats. A two-pronged approach is proposed that builds on the authors’ experience at Kimberly-Clark Corporation in dealing with disruptive threats and opportunities. The approach calls for generation of intellectual assets, often using small proactive teams, to (1) protect an existing business by reducing competitive risks from disruptive innovation, including the risk of new products with disruptive potential and the risk of associated competitive patents that might limit one’s response; and (2) prepare for future new and disruptive business opportunities that could be protected or strengthened by the intellectual assets generated. Kimberly-Clark’s growing experience with this approach suggests that it may be a valuable component of one’s strategy for innovation and protection of the business.