We all know that Intellectual property is intangible in nature. Why then do so many people value Intellectual Property? especially business oriented companies and individuals. This post attempts to answers this simple question.
Intellectual property is actually the tangible expressions of ideas such as inventions literary and artistic works, designs and symbols, names and images used in commerce. The first step in protecting the IP is to identify that what kind of IP one has and the next step is to evaluate such IP. The final step is trying to secure protection for the identified IP.
How to Monetize Trademarks?
The most essential part of every business is to have a trade name/ Trademark. A trademark is a recognizable sign, design, or expression which identifies products or services of a particular source from those of others. This is therefore extremely important for a business, where it can be used for advertising and marketing the products or services you are dealing with. Before choosing any sort of trademark for a business one should make sure that it is unique in nature and not violating any others intellectual property. A Trademark may not look monetizable, but it is! Trademark helps you in building your own brand and also to build your business. And once you create your own brand then you can always sell or mortgage your Trademark to make some good amount of money out of it.
Money from Patents?
Now we will discuss about how a business or an individual can make money from technical inventions through Patent protection? A patent is a government license that gives the holder exclusive rights to a process, design or new invention for a designated period of time. Inventors can enjoy the rights of patent only for 20 years.
How does the patent help you to make money? When you get a patent; you get the exclusive rights to restrict others from practicing the invention for a period of 20 years. That means you can charge a fair price for your patented products to make it available for others to use it, and make a profit. Three simple ways to do this are through Manufacture, Licensing and Sale.
Manufacture refers to the fact that you are utilizing the patent for your own use. By excluding others from using the patented product or technology, you are making a revenue out of sale of such manufactured products.
On the other hand Licensing is perhaps the most common way to earn money from a patent. When a patent owner licenses his idea to another, he grants permission to the licensee to perform certain activities that the patent owner has rights to control such as sell or make the patented invention. A typical license is around 3 to 5 percent, but it will vary from industry to industry and will depend on the expected profit margin.
Similarly, Instead of licensing, a patent owner may consider selling his patent. This way the patent owner does not have to pay maintenance fees to the patent office, pay for litigation, or worry about the economy. Typically, a sale involves more money up front, but no royalties over time.
In the forthcoming posts we will discuss how one can monetize the other forms of IP.
Authored by Rahul Kulkarni.
References: 1, 2, 3, 4
Image Source / Attribution here, this image is in public domain.
