The challenge of selling a patent
The best way to sell a patent is to learn from the experience of other companies who have done it.
There is a great deal of overlap between selling an IpPrism patent and selling a product. If you sell the product, it is important that you understand your customer and what makes them tick. If you sell the patent, it is important that you understand how to write your terms of sale. So let’s take a quick look at how to do each:
Product Selling:
Understand your customer
This will be based on observation as much as research (observing what they pay attention to, what they ignore, what they value and so on)
Write down the exact terms of the sale
These will likely be different for every patent because the “value”. It depend on the technology in question. For example if technology A was invented by xx inventor A whereas technology B was invented by xx inventor B…
Understand your customers
This will be based on observation as much as research (observing what they pay attention to, what they ignore, what they value and so on) Product Selling:
The best way to sell a patent
Lawyers are a dying breed. In the future, the only people who will be lawyers are those who found it useful to be lawyers and those who didn’t. This means that the world of law is rapidly changing and becoming more data-driven.
Rather than treating patents as a commodity, we should treat them as an asset — one that developers might need to convince their clients to pay for. It isn’t as though there aren’t ways to sell patents, but all of these require a different approach. The first is public disclosure (which can complete via a filing, an opinion letter or an announcement on your blog). This isn’t intended to be a sales pitch. It is merely a way of informing your target audience that you have this technology in mind and it will come with something special if they choose to pursue it. The second is word-of-mouth marketing (WOM), where you share information about your patent with other people in your target market who may find out about it through word of mouth or social networks such as Facebook (or, in the case of Android apps, Google Play).
This has been very effective in our previous company, so we continue to do it here. Using WOM effectively has allowed us to get over our initial hesitation and convince some clients. That we were worth pursuing: they thought they already had similar technology. But now they see how much more we can offer them and how much more attractive. The opportunity would be for them if they took us up on our offer. We don’t want customers just because we can sell them something. What matters is whether they have something unique enough that worthy of paying for if we tell them about it first.
Conclusion
Patent rights can buy, sold, and negotiated. They are also a rare commodity. A number of patents own big tech companies who, in many cases, have been operating for decades without any legal need to disclose their patents to the public. In this post I want to discuss why they don’t – and why they should.
Let’s start with the basics: if you have a patent, it is not necessary for you to disclose it publicly. The reason is that a patent can only use for new inventions (not improvements on prior inventions). That is a very broad definition of what “invention” means in the first place. In fact, of the top 1000 most cited patents in the US between 2011 and 2014. (Sample size too small to draw conclusions). All but 5 were never disclosed publicly before they expired, and only 3 were ever disclosed publicly before expiration (in one case. IBM’s. While all other patents were disclosed when they expired).
The majority of these patents have not been invente the people who filed them. Their inventors did not need to file them at all. This means that for companies like Apple or Google. Who have been operating for decades without disclosing their inventions publicly? It doesn’t make sense for those companies to disclose them now. (Though some may view this as an opportunity rather than a limitation).
But why does Apple or Google need to keep these unpublished patents? There are three main reasons:
1) They aren’t required to disclose them because there is no particular benefit from doing so;
2) The public already knows what they do. It’s just different than what people thought when they bought your product; and
3) Disclosing your technology changes your value proposition. Which you think depends on your secret sauce being known to everyone else as well. So disclosing it may actually hurt you more than helping you with your value proposition. This last point is probably false as most products fail because nobody actually wants what you offer anyway. But I digress… Most existing products aren’t secret sauce either. So Apple’s huge advantage isn’t even based on using its own patented technology. It’s based on making better products that everybody wants instead of making better products nobody wants. (I.e., making things that everybody thinks about but nobody buys). But here’s why disclosing a patent will hurt you:
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