Tuesday, December 20, 2005

Intellectual Property, The Little Asset That Could

This article plays up my theory about the New American Business Model.

As we see a huge shift to Web 2.0 applications, I'm already seeing a "land rush" of sorts for intellectual property (IP) that allows this.

What is the one thing that has true value for a company in the States, and it loses its value when/if it's outsourced?

From BusinessWeek Mining the vein of great ideas

In recent years sophisticated investors such as hedge funds and mutual funds have been seeking an edge in the market by looking at R&D through the prism of patents.

"Patents are an output measure rather than an input measure like R&D," says Patrick Thomas, principal at 1790 Analytics.

A good grasp of the quality of a company's patent portfolio is valuable information to investors. But that isn't enough. Companies need marketing, production, and other skills to capitalize on those ideas.

Another intriguing indicator of a company's innovative prowess is the money it earns from its patent portfolio through royalty and licensing fees.

Today, wealth is created by the impact of new ideas and other intangible assets, like patents.


Anonymous said...

Gorilla man: Do you think that the trouble NTP is having with their patents in their suit against RIM will have a ripple effect through the US patent system which could negatively impact key patent holders, or do you think that NTP simply has a bunch of bad patents?

Scott Shaffer said...

I think the NTP case shows how vulnerable companies can be, when they don't do their IP homework.

You have RIMM's core app revolve around cerain IP. I bet if RIMM just did a lil homework, there wouldn't be this problem today.

This will be a growing space. Companies that either patent visionary ideas or ones that invest in them.

Look at Web 2.0, RFID, and Nanotech as the areas where IP will be critical.