Strategies for Surviving the Coming Internet Patent Wars.

TITLE: Strategies for Surviving the
  Coming Internet Patent Wars
PRODUCER: Stanford University
  Media Solutions
YEAR: 2001
LENGTH: 50 minutes
PRICE: $95.00 (VHS format)
SOURCE: Kantola Productions
  800.989.8273, 415.381.9363,
  or www.kantola.com

None of us is a stranger to the concept of patenting a good idea. Today, though, the number of applications for patents are increasing dramatically. Are there simply more good ideas being created, or is there an increased fear of competition? It is actually a combination of both as reflected by a growing number of examples in the media of the need to protect intellectual property and developers' rights to new advances seen every day.

In the video Strategies for Surviving the Coming Internet Patent Wars, Kevin Rivette, co-founder of Aurigin Systems Inc. and a former patent attorney, looks at the changing dynamics in the use of patents. Rivette draws on his own experiences from both legal and corporate perspectives. His manner is very engaging, and he speaks with clear, easy-to-follow examples of his concepts. In 1999 he co-authored the book Rembrandts in the Attic: Unlocking the Hidden Value of Patents, published by Harvard Business School Press. He lets the audience know that many of the examples used in this video are from the research and interviews he conducted for the book.

Rivette challenges the audience to consider the use of patents in unconventional applications. He believes that capturing ideas and leveraging them in the knowledge economy is where every organization's focus should be. Today, ideas have become the product, and unprotected innovation is not an asset. Frankly, it is a liability, and companies can easily create great ideas that benefit their competitors rather than themselves.

Why put so much focus on this need to protect these assets today? What changed? According to Rivette, the very things that used to provide protection are eroding. Global venture capital means that consumers no longer can do what they please with their bank accounts. The ability to recruit and maintain key employees is made more difficult when a competitor can woo them with cooler "toys." The process of getting products to market has shifted from when there were proprietary distribution systems to the world of e-commerce. The demise of proprietary supplier systems are a result of the Internet as well, as suppliers combine contracts through these channels.

In light of these changes, a new approach is required to address the paradigm shift. "Innovate or die" was the old mantra, and the new one should be "innovate, protect, and leverage." Rivette continually reinforces the belief that in the knowledge economy, ideas are the product. Investors and management are turning their focus to protecting those ideas. Technology revolutions have always caused spikes in the demand for patents, but Rivette claims this has never been as great as seen in the market today. In 1990, Microsoft had five patents, and now they have more than 1,200 with another 2,000 in the application stage.

Rivette uses historic examples as well as many current scenarios with some of today's leading corporations, such as IBM, Dell Computer, Intel, and Gemstar. He gives numerous examples of how some of these industry giants are leveraging their patent portfolios. The traditional thinking would be to use them to collect royalties, but companies like Gillette and Procter & Gamble have used their patents to shift the competitive landscape and expand their markets. In one very interesting case, he describes how a company actually lifted the potential royalties to gain a competitor's business.

The topic of patents for workflow, or business processes, is included in Rivette's discussion. However, elabloration and more examples would have been useful.

The speaker's overheads are clear and easy to understand, and his overall message is simple. Today, business deals are being made based on patents. They are being used for merger and acquisition strategies and numerous other things. The purpose of obtaining a patent is no longer just to collect royalties. These reasons make Rivette's video a useful training tool for anyone in business today.

Wendy P. Shade is the Area Manager of Account Development for Iron Mountain Inc. She may be reached at [e-mail].