What is IP value all about? Part II

In response to the preceding post, Joff Wild has come straight back with the following retort:

"I am still not sure I agree with you. If you look at the secondary strap on the front cover of IP Value 2008, it states: "Building and enforcing intellectual property value". So I reckon we do pretty much what it says on the label!

On a more fundamental level, I think one of the problems that many companies and their investors have with IP is that they do not understand the fact that an IP right of itself is pretty pointless, it is the ability (and the willingness) to enforce it that really does create the value. You will find, for example, that while many high-tech start-ups boast of their patent portfolios, many make no provision for the expense of enforcing or defending them - they believe the patent rights of themselves are enough. The same attitude has been pretty prevalent among VCs, though that - I believe - is changing.

If you look at the most recent issue of IAM you will see our annual survey on patent values as reflected in US damages awards and settlements. This, I believe, demonstrates a direct link between enforcement and value, not a tangential one. In the same way, what is Intellectual Ventures if it is not a company that is based very firmly on the premise of creating IP value through the implied threat of enforcement of its rights? The same can be said for most of the intermediaries we look at in the article by Ray Milien and Ron Laurie. Meanwhile, the IAM blog, like the IP Finance blog, has been reporting on Nokia's German dust-up with IP-Com. What is IP-Com if it is not a company that specifically uses enforcement - actual or threatened - to leverage IP value?

With trade marks, the link is even closer, isn't it? Unless you are seen to enforce your marks, you lose the right to use them. Given the emergence of brands as vital corporate assets, such a scenario would be disastrous for many businesses in all kinds of ways.

So, what am I saying here? My view on IP is that you have to see it very firmly in the round - you can't compartmentalise and say this bit is for the lawyers, this bit is for the attorneys, this bit is for the accountants, this bit is for the business consultants, this bit is for the investors etc etc. You need a broad perspective, because it is only with this perspective that as an IP owner you can hope to maximise the value of what you have".

Resisting the temptation to give an instant reply again, I thought I'd give the readers of IP Finance a chance to air their own opinions. If you'd like to add anything to this debate, please feel free to do so below.

What is IP value all about?

In a post last week, this weblog reviewed the most recent issue of Intellectual Asset Management, adding:

"Accompanying this issue is a 245 page supplement, IP Value 2008: Building and Enforcing Intellectual Property Value that contains an impressively wide range of contributions, many of which have only tangential relevance to IP value".

IP Finance has since received an email from IAM's highly respected editor Joff Wild, who writes:

"Thanks for the write-up on the latest IAM on the IP Finance Blog and also the mention for IP Value 2008. Of course, I would disagree that many of its chapters have only a tangential relationship with the book title, as most of the articles deal with enforcing IP rights in one way or another - and if you cannot enforce an IP right there is no IP value! However, your readers might be interested to know that IP Value 2008 is available online at http://www.buildingipvalue.com/, so they can decide for themselves".

In a technical, literal sense, Joff is right: if IP has value, then any chapter on any aspect of IP may be described as a chapter on 'IP Value'. But I think we've reached the stage at which the words "IP Value" have a secondary meaning and that, when we encounter them, there is an expectation that they relate to something to do with IP valuation, leveraging or the like.