This is the fourteenth in a planned 20-part series of articles on intellectual property. In future posts, we will continue to explore product commercialization and look at trademarks and copyrights.
In this posting, we will provide a discussion on the analysis of IP. What should you look for in determining whether certain intellectual property makes sense to pursue for commercialization?
We’ve identified some basic issues to look at as you look for candidate IP to commercialize:
What can be sold with this IP?
Many times the IP itself is for something that makes something else better. For example, Enable IPC has a patent pending on a method to create a certain kind of plate on various substrates without the use of dopants. That’s all well and good, but the real advantage here is in making things like filters – and the technology’s effect on the resulting commercial product is what must be weighted here. We didn’t look at the market for making thin plates on substrates – we looked at the advantages this should present in the filter markets – both in financial and performance improvements.
What is the value to the market of this IP?
In other words, while the IP might make something better, will it jack up the cost too high to make it economically feasible?
For example, a couple years ago Enable IPC looked at some technologies that boosted the energy storage performance of certain kinds of capacitors. There was one technology in particular that enabled significantly more energy storage than others. And, on the surface, it did not seem too expensive to add to a process.
However, capacitance is typically measured in Farads – and when we looked at the final price per farad that the ultimate customer would pay for devices incorporating this technology, it was too high.
The technology was terrific. The price was not tenable in the market.
How much will it cost to get to market?
In our experience, this is a tough question for one major reason: you don’t know what you don’t know.
Whenever a technology is being developed, there always seems to be things that will crop up that were unexpected and not accounted for in the first analysis. Many times, these surprises are mitigated by unexpectedly good outcomes but not always.
There’s an old saying in R&D: Everything takes twice as long and costs twice as much as you expect.
Keep that in mind when analyzing the potential costs to get your technology to market.
What are the likely successor technologies and what will they mean to your product?
The vacuum tube was replaced by solid state technology. Dial phones were replaced by push buttons. Analog TV is being replaced by digital.
Every product has a life cycle. The graph below illustrates this:
How long do you have until a successor technology replaces the one you are commercializing, and how much can you expect to make it the window that you have?
Once these questions are answered, and once the questions these questions raise are answered, you can answer the biggest question of all: does it really make sense to commercialize this product?
In future installments, we will look at some additional activities and analyses that may need to be done, followed by some discussions on trademarks and copyrights.