IP strategy – Insights from Sony and Intel

By 9 December 2014 Insights, Patents No Comments
IP Strategy - Image of Sony and Intel logos

In an interview with Managing Intellectual Property magazine last week, Toshimoto Mitomo, Executive Vice President for Intellectual Property for Sony America, discussed how he manages his company’s vast patent portfolio. Most interestingly, he talked about the various motivations a company may have for building a portfolio, which would of course affect its IP strategy. Though most startups do not have the resources or the reach of a company like Sony, Mitomo’s points are worth considering.

For example, despite much talk about the monetization of patent portfolios (that is, using patents to generate licensing fees or selling them), Mitomo says that Sony’s top priority is not to make profits directly from the IP itself; instead, he says getting the technology to market is a more important goal and suggests that may eventually be more lucrative for Sony in the long run.

Another point he makes is that the valuation of IP can be very subjective- it can be a challenge to figure out what your IP is worth to others in the market, as the needs of different parties vary. Along the same lines, he also pointed out that sometimes a patent’s value may lie less with the technology itself but rather its perceived value, almost as if it’s a marketing tool. He pointed to Intel as an example, explaining that though Intel does indeed license its technologies to other companies, the company’s patent portfolio may in fact be more important as a marketing tool to burnish the company’s reputation as a leader in computer processing technology. Indeed, some have suggested that the “Intel Inside” campaign is one of the most successful of all time.

Effective IP strategy – What are the lessons?

So what does this show us about planning an effective IP strategy? Though your startup may not yet be a Sony or an Intel, there are some important lessons here. Firstly, it is never to early to think about your IP strategy. Why are you patenting? And what you hope to achieve? Do you want to generate revenue by licensing your technology out to others, or do you want the IP to make your own products? Neither goal is superior, nor are they exclusive, and perhaps most importantly, these aren’t the only two options. But taking a step back to think about what you want to do with your IP portfolio may be key to long-term success.

Secondly, and perhaps of more interest to startups who are often forced to run lean and to solve many problems at once, Mitomo’s reference to Intel’s patent portfolio as marketing is an example of how an effective IP strategy can achieve multiple goals. Intel used its patents not just to create space for its own technologies, but also to generate licensing revenues. In addition, Intel’s patent portfolio also bolstered its reputation in the marketplace (and likely also among investors).

Protecting your own products, generating licensing revenues, and building reputation are great goals for almost any business. Thus,planning and implementing IP strategy is not just a one-off item in a list of things to do; it can and should be part of a comprehensive enterprise-building strategy.

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