3rd January 2019
Cipher CEO Nigel Swycher offers his perspective on why 2019 is another big year for IP
Last year we met with over 500 leaders in the field of intellectual property. They have one thing in common – an acceptance that IP in a constant state of flux. What defines them as leaders is their willingness to adapt and engage. Adapt, because you won’t be a leader for long if you don’t. Engagement is perhaps more important – as national and international norms continue to evolve, IP is crystalising into a well-defined asset class. IP leaders appreciate that, in this critical phase of evolution, it is important to engage with policy makers to ensure that this vision becomes a reality.
These are a number of common themes that emerge and some thoughts on how these may develop in the year ahead:
1. Intangible assets now have an audience wanting to learn
More people in more places want to understand intangible assets. EY are leading a major initiative focussed on the corporate reporting of long-term value. Deutsche Bank, UBS and Schroders all now regard patent information to be an important indicator of corporate and industry trends. AON are building an IP Solutions team. This level of engagement from the financial services sector is unprecedented. The IP community must not miss the boat. It is essential that we avoid jargon and communicate on their terms, whoever they may be.
2. IP risk management is not about winning litigation
Our IP Strategy survey revealed that not many companies outside the US understand the network of organisations that are helping reduce the risk of patent litigation and specifically from NPEs. This list includes RPX, AST, LOT Network, Unified Patents, and OIN.
Each of these organisations continues to evolve to the changing nature of risk. RPX went private and appointed Dan McCurdy as their new CEO. AST supported the development of Cipher n/d to reduce litigation and increase rational licensing. Microsoft joined both LOT Network and OIN. Unified diversified into Standard Essential Patents. New companies entered the arena, such as Erich Spangenberg’s IPwe.
Expect more in this area. What if courts pushed for global settlements to cover whole portfolios? How would incentives change if the insurance market could cover the risk of damages in patent litigation? Who would benefit from an objective and rational view of what is a SEP?
3. In a complicated world, keep it simple
It was a blockbuster year for geopolitical turmoil. The US starts a trade war with China with IP centre stage. Europe made heavy weather of the Unitary Patent, not helped by the craziness around Brexit. China continues on its quest for more and better patents and to prepare itself for an increase in patent litigation.
The challenge for companies playing on global and shifting sands is to simplify and focus. While there are and will continue to be national and regional differences in approach to patentability, infringement, damages and injunctions, the sense is that as the world gets flatter, it all comes out in the wash. If you seek to calibrate your IP strategy on a national level, then you may be bucking the trend.
4. Filter reality from hype
Blockchain offers the potential to improve the trust in data accuracy using decentralised ledgers. We live in a world where at least 20% of ownership information at national Patent Offices is inaccurate. This looks like a great opportunity for a patent Blockchain.
Having spent the last 3 years working with IBM, Microsoft, ARM, BAE Systems and others on ownership transparency (oropo.net), you realise that some of the issues we face were not caused by lack of technology, but human failure to do the right thing. For those thinking about this topic for the first time, there is a useful report here. But let’s not think that what is needed is a new cure for migraine if what you observe is someone hitting their head against a wall.
5. Analytics are essential
The world has recognised the importance of patent analytics. 2018 was the year when all arrows pointed in the same direction: sustained investment by PE (e.g. the Castik roll-up of IPAN and Delegate), VC activity (e.g. Beringea’s investment in Aistemos), corporate M&A (e.g. the acquisition of PatentSight by LexisNexis) and the rise in LawTech generally (e.g. LegalGeek),
In order to harness the benefits, companies must focus on specific business objectives, and accept that no one tool can do every job. No one uses a screwdriver to hammer a nail. Our sense is that IP teams are too busy with their day job to maximise the opportunities for improvements that now exist. Those that are making the time are seeing tangible results. We are particularly impressed by Google’s approach to data science in their patent group (you can listen to the Jeremiah Chan interview here).
It is now over 5 years since we started the Cipher journey with the dream that intangible assets could be understood and exploited in the same way as other assets. My sense is that we are getting ever closer at an ever-increasing speed. We are committed to this direction of travel.
Wishing you a happy and successful 2019.
Nigel Swycher, CEO, Aistemos, London