IP Highlights from the article:
”Open Innovation and Intellectual
Property: A Two-Sided Market
Perspective”
Slides prepared by OI-Net team not the authors of
the article, with aim to be used as teaching
support
Ghafele Bashi, R., & Chesbrough, H. (2014). Open Innovation and Intellectual
Property: A Two-Sided Market Perspective. In H. Chesbrough, W.
Vanhaverbeke, & J. West (Eds.), New Frontiers in Open Innovation. Oxford
University Press.
Co-funded by
the European Union
Ref. number: 542203-LLP-1-2013-1-FI-ERASMUS-ENW
Synopsis
o Illustrate the IP management and its impact
on open innovation (OI), in context of
secondary IP market
o Discusses evolution of IP management and
secondary IP market
o Discussed implications of OI on Secondary IP
market and IP management
Introduction
o Studies on role of management in innovation
management are scarce.
Management
plays a key
role in
deciding the
outcome of
an innovation
Source: Chesbrough and Ghafele, 2014, p. 192
Evolution of IP Management
1986: Kilby patent to Texas Instruments
1989: Polaroid won lawsuit against Kodak
for patent infringement
1990s: IBM additional earnings through
patent royalties
2002: IBM earning touched $1.9 billion in
royalties
Series of events contributed evolution and focus of upper management towards IP
management
Two Sided Market for IP
o Intermediate market to transact technology
initiated by one firm and carry forward by other
o Encourage specialization among actors E.g.
Chemical,
Pharmaceutical,
Semi-Conductor,
Service industries
o IP management is challenging in such market
 Establishing scope and legality of an IP
o Business networks could be one source to tap
outside knowledge/IP but has some issues as well
Obstacles to Efficient IP Markets
o Quality of the IP – Patents being declared
invalid during the course of litigation
o Inherent
inadequacies
hindering
the
secondary IP market
 Absence of Terms & Conditions for IP
transactions
 IP is a defensive mechanism mindset. E.g. Nortel,
Kodak
 Historical data on IP transaction
Answering Obstacles in IP Markets
o Extracting value from underlying IP asset
through:
 Securitizations, Pooled Patent Portfolios, Public
Auctions, and Financial Exchanges
o IPXI
(Intellectual
Property
Exchange
International) & TAEUS PatentBooks are some
intermediaries for patent rights exchange.
o ITRI, Taiwan is a platform for pooled patent
portfolio
Conclusion
o OI is a creative driver for IP management in
knowledge-based economy.
o A culture change in industry mindset to
overcome the risk of lawsuit and “not
invented here” syndrome for development of
secondary IP markets
o ICT development supported launch of online
intermediary services but inadequate to
support intermediate markets
Reference
o Chesbrough, H. and Ghafele, R. (2014). “Open
Innovation and Intellectual Property: A TwoSided Market Perspective” In Henry
Chesbrough, Wim Vanhaverbeke and Joel
West (Eds.), New Frontiers in Open
Innovation, Oxford: Oxford University Press,
pp. 191-207.
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OI-Net Coordinators
Lappeenranta University of Technology, Kouvola
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o Marko Torkkeli
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o Justyna Dabrowska
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This project has been funded with
support from the European
Commission.
This publication reflects the views only
of the author, and the Commission
cannot be held responsible for any use
which may be made of the information
contained therein.
Programme: ERASMUS
# 542203-LLP-1-2013-1-FI-ERASMUS-ENW
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