In the research and development industry where innovations build on top of other innovations, obtaining patents to protect intellectual property is of the utmost importance. It is critical to ensure that patents being are utilized, especially within big corporations like IBM or organizations like the Unites States Navy. Not only do patents protect newly developed products or processes, they contribute to unrealized value creation, or assets that can be explored and sold.
The latest development besides one-on-one deals and patent auctions is IPXI, the newly formed IP exchange created after the successful Carbon IP Exchange model. IPXI, the Intellectual Property Exchange International Inc., is the world's first financial exchange focused solely on intellectual property rights. Some major companies like Philips, Ford and Sony have already signed up as corporate founding members and will begin trading in the near future. Since its formation in December 2011, 27 organizations have joined the IP exchange, representing innovative companies with substantial IP assets in various technology markets, three Department of Energy national laboratories, top university research institutions and a community of leading IP law firms.
IPXI revolutionizes the way patents are licensed and traded by allowing companies to buy and sell patent rights as units. These "unit license rights" can be bought and sold like shares. For example, one unit license right grants an organization a one-time right to use that particular technology on a single product. If a car manufacturing company wishes to use that technology in 50,000 cars, they purchase 50,000 unit license rights at market price. Organizations can now bypass costly litigation and use the IP exchange to harness patents as assets, monetize it fairly, and use it to spur greater innovation.
"The Exchange creates a new approach to technology licensing that overcomes the inefficiency of traditional bilateral technology license negotiations. For the first time, companies and other entities will be able to buy and sell units of technology usage, providing improved economics, enhanced access to technology, and greater flexibility should technology needs change," says Gerard J. Pannekoek, President and CEO of IPXI.
The concept especially benefits smaller companies with modest budgets by creating a simpler, faster, and cheaper method to obtain IP rights. And that is good news for innovators indeed.
For more tips, see "Patently Obvious" and other Chapters in "Robert's Rules of Innovation: A 10-Step Program for Corporate Survival."