Economy
Market strategy crucial to innovation
By Lu Wei (China Daily)
Updated: 2010-02-10 07:39
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Intellectual property performance should not be simply judged by patent and trademark applications, but also on how rights are used in the marketplace, said Zhang Ping, professor of Intellectual Property Institute at Peking University.
"The primary reason for an enterprise to acquire intellectual property rights is to position itself better in the face of competition," she said, noting two perspectives on the pursuit of sustainable growth.
One is the strategy for innovation in technology, management and corporate culture that provides input in creating and managing patents, trademark and copyrights.
The other is a market strategy. "The intellectual property system is an outgrowth of the market economy. For an enterprise, the purpose of using the system is to maximize profit," Zhang said.
"The creation of patents does not necessarily depend on technological innovation, but is more likely an arrangement to satisfy market demands," Zhang said.
She cited defensive, offensive and "scarecrow" patents as strategies to meet different competitive needs.
Defensive patents can protect the patentee by preventing others from applying for the same or similar patents, or by allowing the patentee to counter-sue if competitors allege patent infringement.
An offensive patent prevents other companies from using inventions or requires licenses from the patentee in return for fees or royalties.
A scarecrow patent is not asserted by the patentee in an infringement action, but nevertheless serves to "scare off" potential infringers or competitors. It provides a way to eliminate unfair competition by showing potential infringers there is a "patent certainty" even if no infringement claim asserted.
Zhang added that outsourced equipment manufacturing (OEM) should only be a temporary expedient, not a long-term development model for an enterprise.
OEM makes products or components that are retailed under a purchasing company's band name, which Zhang said probably has a negative impact on the development of the manufacturer's capacity for innovation.
"Compared to manufacturing industries abroad, domestic enterprises will lack competitiveness once they one day lose the advantage of low costs," she said.
Zhang suggests that medium and small-sized enterprises that do not meet requirements for managing their intellectual property should enhance cooperation with universities, research institutions, venture funds and the other resources.
