Patent Risk

Why the Cipher platform is ideally suited to help you with all aspects of your patent portfolio.

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Cipher has produced a number of reports, hosted industry webinars and carried out a major survey on the subject of patent risk. Whether it’s risk mitigation, or the broader need for risk management, Cipher’s classified patent data will meet your needs to analyse and implement a robust IP strategy. Classified patent data around your technology areas, allows you to assess the material patent risk to your organisation and develop mitigation strategies.

On this page:

Why Patent Risk
Survey
Risk Management
Risk Analysis
Risk Strategy

Risk mitigation is the primary reason for having a patent portfolio. It is essential to understand where risks lie, how to quantify and communicate the material impact to your wider organisation.

Cipher provides a solution for risk assessment and mitigation by:

Benchmarking your competitors
Rightsizing your portfolio
Dealing with patent assertion

Our global survey on patent risk uncovered the following:

It is unavoidable for most, inevitable for many and generally not reported.
Building a strong patent portfolio is the primary approach used to mitigate risk, but is only part of an overall strategy.
The main challenges when communicating risk include the absence of objective and reliable data, as well as a lack of understanding of patents at board level.

Patent risk survey – key findings

Over 90% of survey respondents identified the building of a strong portfolio as the best way to mitigate risk. Other strategies include contracts with suppliers and customers (65%) and licences and cross-licences (61%).

Key Findings Report

Threat Identification Process

Patent risk process for threat identification

The crucial first step in risk analysis is the identification of potential threats.

Where are those threats more likely to come from? Cipher takes the following approach to identify threats:

Benchmark you portfolio to see which organisations should be in your threat list
Who out of your threat list poses a near term threat by their propensity to litigate
Which organisations in your technology space are ‘Fast risers‘ i.e. they are innovating quickly, and could pose a threat in the mid to longer term.

Once you have your threat list, you can quantify the potential risk posed in monetary terms to your organisation.

You can then quantify how different mitigation strategies will materially reduce your risk. You also face increased risk in the longer term as your organisation grows and gains market share. Cipher can help you assess your risk exposure in the longer term to ensure this is part of your IP strategy .

Risk Mitigation Implementation Webinar

Patent Risk Analysis

This example uses the Cipher Universal Technology Taxonomy and a spoof company, Mars. It demonstrates how you can mitigate operating company risk and estimate the risk mitigated by its patent portfolio in dollar terms.

Analysis Example

Risk Management

Risk Management Process

Cipher has created a 5 step risk management process. This framework would help you to put together a robust strategy for your business.

Identify Threats
Materiality of risk
What action can you take?
How can you communicate this?
Regularly review and reassess

Cipher conducted a global survey and the key findings show, that nearly half of patent owners have a risk matrix or framework. However, they only use it when there is a significant issue.

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Cipher report on patent risk management

Risk Management

The report covers:

What are patent professionals doing to manage risk?
How can you take a proactive approach?
What risk mitigation strategies can you adopt?

Have you ever asked these questions?

What information best conveys to the CTO and CFO the value delivered by our patent portfolio?

Many companies cannot point to direct licensing revenue. There are, however, established ways to link the cost of your portfolio to the quantum of patent risk mitigated. Executives are alive to the substantial risk of paying away substantial royalties. Explaining the relationship between your patents and the ability to neutralise threats plays well before this audience.

How can I prepare my organisation for the patent risks ahead?

Many organisations use economic models (such as the Cipher Optimisation Model) to develop a patent strategy that anticipates and mitigate the risk posed by owners of ‘relevant to technologies’ you deploy.

“Whatever your perspective, no-body wants to be unprepared for litigation. In today’s environment, the risks are so large that you want to be ready. While figuring out whether you have a balanced portfolio is hard, it’s something that more and more companies are taking very seriously.

Erik Oliver, COO, Richardson Oliver Insights

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Book a 15-minute exploratory call with our team by viewing their diary and choosing a slot to suit you.

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Managing PAE Patent Risk

Episode 6 in Season 2 of the Cipher Vision Podcast series features Ken Seddon, CEO of LOT Network. Ken discussed the threat that PAE companies pose to innovation, as well as the role that operating companies have in taking positive, collaborative steps to ensure a sound patent strategy.

Identify Areas of Risk

What are the top areas of risk to your business? Use Cipher to understand where you may over or understocked versus your competitors

Develop a Risk Framework

Categorise and rank the different risk areas. Use Cipher’s Portfolio Optimisation model and Benchmarking dashboard to quantify.

Internal Communication

Use a Risk Framework and Cipher model outcomes to propose risk mitigation solutions to the C-Suite.

Risk Mitigation Strategy

Measure the effect of risk mitigation strategies and amend as a new risk arises