Intellectual Property is a type of asset that is basically information structured in a novel way that it becomes profitable to you or your business. This information could be old or brand new.
Unlike traditional property, IP can be complicated. For example, a novel idea may not be protectable by law but its expression may be protected under law. Similarly a few tweaks made in the code of an existing software may not be protectable under patent or copyright but could be protected as confidential information through smart contracting.
The underlying principle of IP is that it should be novel and should be exclusively restructured by you in order to be monetized. Hence it is imperative to first recognize a valuable Intellectual Property before you can monetize it. Read on...
WHAT CONSTITUTES AN INTELLECTUAL PROPERTY / ASSET?
An IP asset is an intangible asset that can be reproduced in a tangible form where every reproduction adds value to business. For example, Manufacturing goods using your patented formula could result in creating a market for your products where as using your logo as Trademark can a useful tool to build brand reputation and recognition. But how do you identify whether a certain information or restricted data constitutes your IP?
Following are the basic characteristics of an Intellectual Property that add value to your business:
INDEPENDENT IDENTITY: Your IP asset should be independently identifiable, to your customers and to the market in general. This means that your asset should have an identity without your goods, your company or your other assets. For example: Even though your trade mark might be your company’s name, it is an independent entity. You can stop using that mark any day and start using another. The asset, though used in conjunction with the goods of your company, is a completely separate entity. Similarly a patented formula is owned by a company but is a separate entity from the business and its other assets.
PROTECTION AND LEGAL ENFORCEABILITY: IP is recognized as an asset under law and are as such protected under the law. This is the simplest way to recognized your IP asset. If a structuring of information/data is recognized and protected by law, it is an IP asset and can greatly profit your business. A caveat being that sometimes a specific IP may not be statutorily recognized, but these assets can be protected by smart contracting and negotiating with the right partners for the right value, like trade secrets or confidential information. These assets are usually recognized by courts and fall under the purview of judge-made law.
OWNERSHIP AND TRANSFERABILITY: This is the most blatant and simple test to gauge whether a restructured information is an IP asset or not. Your Intellectual Property should be transferable. This is an extension of the first point. Your IP should be material enough to change ownership and to be assigned, licensed etc. For example copyrighted script can be further licensed to a production company to be made into visual content. However the idea in the writer’s head before he wrote it on paper could not have not have been transferred, hence would not constitute an IP asset.
ADDS CONCEIVABLE VALUE: Your IP should be working for you and not vice-versa. You should be able to use it to start a vertical or an entirely new business, use it to grow your portfolio and your commercial footprint. Sure the protection might be an investment but with such investment you should be able to secure your future and foresee continued stream of profits.
MARKET LONGEVITY: Economic Longevity is a non-negotiable part of any business asset and IP is the same. It should be able to be used, to profit to grow. This is not the same thing as an asset continuing to hold the market attention for a long time, but it should be able to do it if it receives continual and proper input. For example an inventor may have discovered a new formula by accident but as long as it works and can be monetized by the company it is an IP asset. However if the same inventor invents a wonderful new formula, which cannot be monetized on a larger scale, it is not an IP asset.
An IP asset, thus may be specifically created with the purpose of solving a problem and monetizing it, or it could be created in the normal course of business. Both are legitimate and accepted ways of creation of IP and in both scenarios IP can be used to create and maintain value of your business.
Though not difficult, identification of IP assets could be slightly technical at times. Our IP experts at InstaMark are available to guide you on your journey to creating value and maximizing profits. Reach out to us for a free consultation on your existing and new IP and how to protect and monetize it.
Informative