Strategy Workshop

July 2013

Outline

• Recap• Strategy Overview• IP Audit• Searching• Strategy formation• Implementation

Patent Space

Monetize

Exclude Interact

LicenceSell

Collateralise

EnforcementThreat

Access other innovationLeverageStandards

Interoperability

Defensive Patents Trade Marks Know-How Relationships

Conflict Avoidance/Resolution

• Protection (exclude others)• Design Freedom• Cross-licensing (defensive)• Litigation bargaining power

• Protection (exclude others)

• Protection (trade secret)

N/A

Offensive

Revenue Generation• Products and Services: Sales, Licensing, JV, Optimisation of core tech, Value from non-core tech, Integration• Patents: Sales, Licenses, Infringement policing• Increased bargaining power (e.g. suppliers, customers, affiliates, JV partners)• Market penetration• Increased speed to market

• Products and Services: Sales, JV, Alliance• TM: Sales, licensing, co-branding, Infringement policing

• Sales• Licenses• JV• Strategic Alliances• Integration• Increased speed to market

• Product and services sales

Cost Reduction• Litigation avoidance• Access to technology of others• Improved knowledge transfer• Reduce knowledge gaps

• Litigation avoidance• Access to tech of others

• Litigation avoidance• Improved knowledge transfer

• Reduced marketing costs

Strategic Position• Reputation/image• Exclusivity/blocking• Barrier to competition• Supplier control• Customer control• Optimization of core technology

• Name recognition• Customer Loyalty• Barrier to comp• JV• Alliance

• Reputation/image• Barrier to entry

• Reputation/Image• Customer loyalty• Barrier to entry

Adapted from “Edison in the boardroom revisited” S Harrison and P Sullivan 2012

Hambrick and Fredrickson

Hambrick and Fredrickson

Strategy Overview

Objective Information Strategy Implementation

Example: Juniper Networks

• Juniper is not in the business of IP it is in the business of selling products

• IP strategy has to support the business strategy by:– Counter assertion against operating companies– Sustaining competitive advantage– Preventing copying/reverse engineering

Strategy Overview

Objective Information Strategy Implementation

Categories of Information

• Business• Technology• Existing IP• IP Landscape• Resources

www.newmorningip.com +353 1 254 2340

IP AuditExternalInternal

www.newmorningip.com +353 1 254 2340 Source: WIPO

Source: WIPO

www.newmorningip.com +353 1 254 2340

External

• Patent searching and landscape• TM databases• Design right filings• Competitive intelligence

Strategy Overview

Objective Information Strategy Implementation

Hambrick and Fredrickson

– first 15 years• 1991 startup• 2002 Launches first GPS navigation product• 2004 first standalone portable device• 2004-2005 7x growth• 2005 NYSE/Euronext Amsterdam listing• 2006 TomTom aggressively enters US

threatening Garmin’s 50% market share

State of Play 2006

0

50

100

150

200

250

300

Garmin TomTom0

100

200

300

400

500

600

Garmin TomTom

US revenues ($M) Granted US Patents

– what happened next

• Crisis in the company• Hired a Director of IP Strategy (Peter Spour)• Bought three patents• Countersued against Garmin• 2007 Settled all WW litigation with Garmin• Developed a patenting strategy• Began targeted patenting

- now thriving• 2009 Sued by Microsoft Corp• Settled with cross-licence• 4X US revenue increase 2006-2010• Firmly established as #2 in US with

appropriate patent portfolio • Approx. 5-10 patent litigations in progress

TomTom’s patenting activity

020406080

100120140160180200

WW Patenting Activity

2003 2005 2007 2009G

arm

in s

uit 2

006

Strategy Overview

Objective Information Strategy Implementation

Protecting the Core

New Initiatives

Growing the core

IAM

Conservative Progressive Aggressive

Protect 75% 60% 45%

Grow 15% 20% 25%

New 5% 12% 20%

IAM 5% 8% 10%

Adapted from “Harvesting Intangible Assets” A Sherman 2012

Priorities

Review Criteria• Is there existing prior art?• Does the invention have commercial potential• Is the invention patentable?• Can it serve or strategic purpose?• Will a patent on this deliver a business advantage?• Do we have other competitive advantages that reduce or enhance the need for a patent?• Does a patent on this invention support our position in the technology space• Are willing to litigate over this patent if challenged• Can we detect an infringement of this patent?• Are the business, legal and technical risks acceptable?• Would the invention be useful to someone else?• Does it relate to a standard?• Does it align with filing targets?

Prepare for Implementation

• 6 P’s– Policy for IP management– Personnel practices– Portfolio management practises– Procurement practises– Partnering practises– Policing activities

Resources

• Are you sure you have a strategy?– http://bit.ly/hRxc0w

• INTIPSA TIPS series– http://www.intipsa.com/45-resources/briefing-notes/95-briefingnote

s.html• Books

– Driving Innovation by Micael A Gollin– Edison in the Boardroom Revisited by Suzanne S Harrison and Patrick H Sullivan– Burning the Ships by Marshal Phelps and David Klein– The Defense of the Mieza Chip by Robert Cantrell and Duncan Bucknell

APPENDIX

Source: Ocean Tomo

SO - WHAT NEEDS TO BE DONE?

Rationale

• Patent risks for growing business

• Move from service to product based model

• Signalling value to investors

The Business Model Investors Prefer, MIT Sloan Management Review June 22 2011

Business Value

• Defence

• Cost avoidance

• Revenue Generation

• Strategic

37

What needs to change?

Business Value

Business

IP Technology

Valuation

Man

agem

ent

Creation

Business

Technology

Now

Future

CTO

CIPO

CIPO

CTOCTO

Valuation

Valuation

New Processes

Proposal Phases

Phase 1: Consolidate Position

• Strategy capture• Initial positioning landscape• Preliminary portfolio specification• Process development• IP awareness training and development

Phase 2: Managed Portfolio

• More detailed patent landscape• Mapping and planning patent portfolio• Screening criteria & process development• IP office development, metrics & reporting• Prototype “make vs buy”• Begin systematic innovation training

Phase 3: Value Capture

• Go beyond purely defensive forms of value• Define what value means for Openet• Relate to business strategy• Define IP office support• CIPO role becomes defined• Build a credible IP value proposition for investors

Phase 4: Synthesis

• More productivity throughout entire patent value chain• Deepen impact on Openet• Regular use of patents for CI• Patent attorney on staff• Difference between invention and innovation• Expand systematic innovation capabilities

Phase 5: Create the Future

• Patents used as strategic options• Value of all elements of portfolio understood• Patent strategy and process reviewed regularly

fred.logue@newmorningip.com +353 (0)1 254 2340 l www.newmorningip.com l @newmorningip