The patent assets of a company in market failure
A post titled Patent Perishables at ipeg goes into "what happens to IP" when a company faces bankruptcy, illustrating with the company Qimonda AG, Germany’s DRAM made as (sort of) an example. Some colorful text:
A large chunk of patents, no doubt as your main intangibles assets. No longer protecting parts of the business after bankruptcy, an important function of the patents, to cover own production, is lost, so is a large part of the portfolio value (“value in use”). Selling the portfolio as a company under bankruptcy protection is like asking the wolf whether he wants to eat the deadly injured deer.
Some companies, facing an inability to compete in the market in manufacturing, might decide to become purely IP companies. (Ring a bell?) Others, might decide to manufacture different things. (Intel and memory chips in the 1970's). If one does a crash & burn without a plan, the value of the IP can go free fall. IP in isolation, without a business plan, has no value.
Some keywords:
impairment test
amortization of patents
**In passing, Device for detecting the peak value of a signal, including A device for detecting the peak value of a signal with crest factor not known a priori includes a pair of peak detectors
**Separately
from 009 CIPO Manifesto:
The Chief Intellectual Property Officer (CIPO) is an emerging, senior role within corporations. While guided by
the CIPO Manifesto, the CIPO role is not completely understood, even by the leaders of the global IP
community at the forefront of creating this critically important role.
(...)
The CIPO must not let IP matters be “quietly handled” but must instead integrate IP
into the fabric of corporate strategy and execution.
(...)
Perhaps more important than the centralization/decentralization structure question, the participants felt
that the successful CIPO must be capable of first establishing a compelling vision and then work
towards that vision with concrete, measurable, and provable deliverables.
(...)
Valuation of IP assets and “getting IP on the balance sheet” remains this single biggest financial, and
quite possibly the single biggest challenge overall facing CIPOs. This is distinct from the misguided
expectation that the primary role of the CIPO is to either increase licensing revenue or reduce
corporate IP risk.
A large chunk of patents, no doubt as your main intangibles assets. No longer protecting parts of the business after bankruptcy, an important function of the patents, to cover own production, is lost, so is a large part of the portfolio value (“value in use”). Selling the portfolio as a company under bankruptcy protection is like asking the wolf whether he wants to eat the deadly injured deer.
Some companies, facing an inability to compete in the market in manufacturing, might decide to become purely IP companies. (Ring a bell?) Others, might decide to manufacture different things. (Intel and memory chips in the 1970's). If one does a crash & burn without a plan, the value of the IP can go free fall. IP in isolation, without a business plan, has no value.
Some keywords:
impairment test
amortization of patents
**In passing, Device for detecting the peak value of a signal, including A device for detecting the peak value of a signal with crest factor not known a priori includes a pair of peak detectors
**Separately
from 009 CIPO Manifesto:
The Chief Intellectual Property Officer (CIPO) is an emerging, senior role within corporations. While guided by
the CIPO Manifesto, the CIPO role is not completely understood, even by the leaders of the global IP
community at the forefront of creating this critically important role.
(...)
The CIPO must not let IP matters be “quietly handled” but must instead integrate IP
into the fabric of corporate strategy and execution.
(...)
Perhaps more important than the centralization/decentralization structure question, the participants felt
that the successful CIPO must be capable of first establishing a compelling vision and then work
towards that vision with concrete, measurable, and provable deliverables.
(...)
Valuation of IP assets and “getting IP on the balance sheet” remains this single biggest financial, and
quite possibly the single biggest challenge overall facing CIPOs. This is distinct from the misguided
expectation that the primary role of the CIPO is to either increase licensing revenue or reduce
corporate IP risk.
posted by Lawrence B. Ebert at 7:24 AM
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