The views expressed by the business participants are their own.
Did you hear about Google’s recent $1.67 billion settlement in a patent lawsuit? It really shines a light on the high stakes of copyright disputes. While this may be a small setback for a giant like Google, it is a wake-up call to every company about the importance of effectively managing patent programs.
As the saying goes, “By failing to prepare, you are setting yourself up for failure.” This principle fits well in the context of managing the patent system, where the focus is not only on creating protective legal protections but also on systematically selecting which innovations to patent. Such decisions, closely aligned with business goals, are important for big players like Google to avoid litigation and even more important for startups. First, a strong patent portfolio can be the ticket to increase their market value and attract investors.
With this in mind, let’s look at how even the slightest mismanagement of patent systems can lead to significant setbacks.
Related: Top 5 Intelligence Challenges Businesses Face
Can failure to protect a new product be dangerous to health?
Imagine it’s the middle of the night. Someone with known heart disease is sleeping, relying on their smartwatch to alert them to any dangerous irregularities in their heartbeat — a feature they trust like a lifeline. But without informing them, this feature has been quietly disabled – caught up in a proprietary business battle. Suddenly, this is not just the clock failing to tick or the screen freezing. It’s about an important safety net being pulled at the worst possible time. This is not just a technical error; it is a huge misstep in business ethics. Decisions like these can undermine consumer confidence and cast a long-term shadow over a business’s commitment to protecting its customers when they need it most.
An example of this is the case of Masimo, a medical technology company, against Apple for using their patented blood pressure monitoring feature on two Apple watches. Initially, Apple was asked to recall the product from the market, but in response, they decided to disable the feature in order to continue selling. This decision, while seemingly strategic, could have serious implications. Did the consumer who bought the product of the monitoring features injured life or even death because the feature was removed from the file suit?
In the unforgiving world of intellectual property, even industry veterans can occasionally make mistakes in deciding which inventions should be protected by patents or licensing.
Consequences of mismanagement of the patent system
For large businesses, a poorly managed patent system can lead to significant financial losses, a weakened market position and increased vulnerability to litigation. Meanwhile, for small businesses, the rates are much higher. They may not have the resources to bounce back from similar missteps, which can lead to disastrous consequences, including closing the business.
Now let’s take a closer look at these negative consequences of mismanaging the patent system and how they can be avoided:
Market opportunities are missed
A common pitfall in patent program management is when your strategy fails to keep pace with your evolving business goals. As markets and technology change rapidly, what is important to your business today may not be as important tomorrow. This flexibility can result in you accumulating proprietary rights that no longer support the way your business operates.
Such misunderstandings can lead to inefficiencies and, more importantly, missed market opportunities. The important thing here is that do soul searching regularly, reassessing and reorienting your patent portfolio and your business goals. This means pruning where necessary and expanding where opportunities arise, ensuring that your intellectual property supports your long-term business goals.
Related: Unlocking the Market Potential of Your Patent Portfolio – An Entrepreneur’s Guide
Money lost on bad patents
Let’s face it: It’s challenging to predict which patents will add value to your business without understanding their market potential, which isn’t possible during the startup phase. Many businesses choose the “shooting method,” filing a bunch of patents and hoping that some will eventually pay off.
This strategy is dangerous — “bad patents” can consume valuable resources in filing and maintenance costs without providing any return on investment, cluttering your portfolio with irrelevant IPs.
To avoid such problems, my approach with clients involves focusing on innovations with the greatest commercial potential or protecting the most important products of your business. I do this by analyzing competitors’ patent positions, identifying market gaps to gain competitive advantage and avoid saturated areas. Regular portfolio reviews and targeted pruning help weed out underperforming patents, maintaining a lean and efficient patent portfolio.
This strategy is important not only for established businesses but also for startups. Research shows that startups with valuable patents are 10X more likely to secure funding, highlighting the significant benefits of patenting a strategy.
The protective value at stake of patents
For many large businesses, the purpose of amassing a strong patent portfolio is to use it defensively – to fend off potential lawsuits from competitors. I’ve seen businesses tend to believe, “If we get sued, we can contest our patents.” And to do so, they’ve built huge portfolios of ownership by licensing anything and everything.
But what if your portfolio isn’t strong enough? Lack of a strong defense shield can leave you vulnerable to aggressive legal challenges from strong competitors in the market, which can be both costly and disrupt your business operations.
To reduce this, the strategy must focus on it quality over quantity. It’s not just about having a lot of patents but making sure each patent is strong, usable and covers important technology that is important to your products or the industry in general. This requires a strategic assessment of both your technical needs and your competitors’ patent areas. Regularly evaluating the strength and scope of your patents helps ensure that your portfolio can effectively serve its purpose of protection.
In addition, engagement active IP test and looking for opportunities to strengthen your portfolio through acquisitions or internal innovations can further strengthen your defensive strategy. These studies can identify patents that are no longer important to the industry to avoid paying additional maintenance fees.
Related: The Basics of Protecting Your Intellectual Property, Explained
Copyrights are more than legal protections; they strengthen businesses and have an impact on life. The story of Massimo’s patent war shows the importance – to protect not only the future of business but the well-being of people. It is important to ensure that your strategy is solid, combining business goals and sound innovation. The right approach is not just about protection – it is a competitive advantage rooted in commitment. Turn your intellectual property into a cornerstone of success and influence.
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