How to Find the Best Licensing Opportunities for Your Patent

When it comes to licensing, knowing where an industry or company is going is key to landing a licensing partner. Many IP owners make the mistake of thinking about the value their IP offers as the market exists today, rather than the value it offers as it relates to where an industry or company is going.

How can you find out where an industry is heading or what your competitors are up to? One of the best ways is with a patent landscape analysis (also known as an IP landscape). Simply put, a patent landscape is a report on who owns which patents in which countries and what these patents cover. It gives you insight into where companies are going with their technology and ultimately with their business. In addition to analyzing industry trends and competitive technologies, it’s also used to find licensing opportunities, focus R&D activities, spot acquisition targets, avoid potential infringement, and evaluate a company for investment.

Patent landscapes run from a simple visual graph of competitive technologies in a group to a very complex, in-depth analysis reviewing thousands of documents from dozens of patent offices worldwide, along with legal and technical assessments of the technologies. Which level of landscape analysis you need depends on what it’s for. If you just need a quick overview of who the biggest patent holders are, than a snap shot visual graph analysis will do the trick. If you’re acquiring a large portfolio of IP with dozens or hundreds of patents, then you’ll want a thorough analysis to understand what you’re buying.

Keep in mind the patent landscape is a picture at a specific point in time. If it’s a highly competitive market with lots of new technologies and competitors, the snapshot will change quickly. Keeping the landscape up-to-date in these situations is cumbersome, but that’s improving as new analytic solutions enter the market.

When I work with a client in developing the licensing strategy, the first tool I use is a patent landscape snap shot showing the current market players as well as those new to the market. It’s one of the quickest ways to identify potential licensing partners, especially if they’re an unexpected player entering the industry. This is how I discovered a licensing partner for one of my clients in the oral health space. They were a tiny blip on the landscape radar showing them moving into the consumer oral care market.

IP landscapes are great for spotting patterns and trends in an industry. Retail is a good example. Walmart and Amazon file hundreds of patents each year. These cover everything from back-end inventory management technology to drones flying around delivering products to customers. The underlying aim of these technologies is to make the shopping experience easier for customers.

Many of the technologies these retail giants are pursuing are designed to enhance the shopping experience. Some of these include virtual-reality glasses or other augmented reality devices to help guide customers in the store, technology that recommends impulse items as they move through the store, and even a technology to help shoppers find the most efficient way to navigate the store to complete their shopping list. And of course, technology that makes it easier and more efficient for customers to check-out and buy their products.

While many these patents may or may not come to fruition, they do provide insight into where these companies are heading with regards to their technology. In this case, if your IP can be used to enhance the customer shopping experience, these companies might be interested in licensing it.

Understanding where your competitors are going helps you focus your R&D on improving or developing your next generation of IP. Rather than sifting through hundreds or thousands of patent text files, the landscape presents a visual analysis of the biggest patent holders in a specific technology category and sub-categories. For example, a growing volume of new patents, such as for autonomous driving technologies in the automotive industry or wearable devices in the med tech industry, indicates where the industry is going as well as intensifying competition. You can also learn what companies are collaborating on IP development, and which ones are slowing down or backing away from IP development. You can even drill down and analyze patents by performance attributes, such as twin razor blades for a closer shave.

Discovering idle or under-used IP assets to acquire is another way to use a patent landscape analysis (also known as patent mining). IP is often the most (or only) valuable asset of innovative companies. Patents, brands and trade secrets are valuable even if the products (and company) fail in the market. Many companies are sitting on large portfolios of unused patents. It’s estimated that over 90 percent of patents sit idle. This includes tens of thousands of patents developed by universities and research labs. According to Forrester Research, U.S. firms annually waste $1 trillion in unused and underused IP assets. You can spot new opportunities for unused patents, acquire it and use licensing to generate revenues, bundle it with other IP, or re-purpose it for new product applications.

Patent landscapes help you avoid infringement dangers. They are often linked with a Freedom to Operate, which is a legal opinion provided by a patent attorney on whether your patent potentially infringes on other patents. Learning which patents potentially overlap your patents before launching it in the market (or continuing to develop it) can save you tens of thousands of dollars (or more) in litigation expenses.

Investors can benefit from patent landscapes as well. Knowing where the market is going and the technologies driving the key players helps you determine which companies offer the best upside potential. One example is the Internet of Things (IOT), a collection of multi-billion dollar industries connecting everything from medical and fitness, household appliances, cars and even industrial machinery, creating a booming market for connected devices worldwide. A patent landscape identifies which of these markets is on the verge of explosive growth. It helps you understand the market players, their experience, and whether their technology stands alone, is vital for creating other devices, or is up against stiff competition from similar products. Most important, it helps evaluate whether a company has a strong IP (and competitive) position, which is a good indicator of future success and a risk reducer providing residual value if the business fails.

Competitive industries change often with new players and technologies. Companies today are scrambling for new IP to meet the demand of these new markets and customers. A patent landscape gives you strategic insight to see where an industry or company is going. And that’s where the opportunity exists for your intellectual property. The better you position your IP as a solution to where the market is going, the more interested a company will be in licensing it.