Intellectual Property →
- 09 Jan 2012
- Working Paper Summaries
When to Sell Your Idea: Theory and Evidence from the Movie Industry
How completely should an innovator develop his idea before selling it? HBS assistant professor Hong Luo addresses this question in a theoretical framework that links the sales stage to the innovator's "observable quality." She uses the context of Hollywood movie script writing-looking at whether it's better to pitch the mere idea for a film or to write the entire screenplay and then try to sell it "on spec." Key concepts include: Pitching an idea before a script is written can be advantageous in that it affords the opportunity to get early feedback from a prospective buyer, and saves time for the writer if the buyer thinks the idea is worthless. However, pitching comes with the risk of expropriation. Lesser-known, inexperienced writers are excluded from the market for pitches, forcing them to either fully develop the idea or drop it entirely. Writers who have a choice in the matter tend to sell their better ideas on spec-turning them into fully-formed screenplays before introducing them to prospective buyers. But they will pitch their worse ideas at an early stage. Closed for comment; 0 Comments.
- 29 Sep 2011
- Sharpening Your Skills
Sharpening Your Skills: Leveraging Intellectual Property
Many companies lack a coherent policy for maximizing the value of their intellectual property. In this collection from our archives, Harvard Business School faculty offer insights on the importance of IP and how best to protect and use it. Closed for comment; 0 Comments.
- 17 Aug 2011
- Research & Ideas
Protecting against the Pirates of Bollywood
Hollywood's earnings in India have largely been disappointing. Professor Lakshmi Iyer believes the problem has more to do with intellectual pirates than the cinematic kind. Open for comment; 0 Comments.
- 01 Aug 2011
- Research & Ideas
Immigrant Innovators: Job Stealers or Job Creators?
The H-1B visa program, which enables US employers to hire highly skilled foreign workers for three years, is "a lightning rod for a very heated debate," says Harvard Business School professor William Kerr. His latest research addresses the question of whether the program is good for innovation, and whether it impacts jobs for Americans. Key concepts include: An uptick in the number of H-1B visas given to Indian and Chinese engineers correlates with an increase in the number of US patents. The H-1B program seems to have no overall effect on the number of jobs held by American-born scientists and engineers, nor does it affect the number of patents from inventors who have Anglo-Saxon names. Closed for comment; 0 Comments.
- 12 Jan 2011
- Working Paper Summaries
Modularity for Value Appropriation--How to Draw the Boundaries of Intellectual Property
Many firms have adopted models of "open innovation," in which they seek ideas from external sources such as university labs, independent entrepreneurs, customers, and other companies. While such a business model has the potential to create value, the inherent intellectual property issues can be sticky. This paper discusses how companies can address these issues by adopting a system of modularity, wherein innovation in one part of a project will not require changes in all the other parts. Research was conducted by Joachim Henkel of Technische Universität München and Harvard Business School professor Carliss Y. Baldwin. Key concepts include: Controlling too much of the system's intellectual property will deter outside innovation, but controlling too little can prevent a firm from capturing value. A system can use different, incompatible forms of intellectual property and still be IP-modular, provided that the incompatible chunks of knowledge are associated with different modules within the whole system. The optimal modular structure for capturing value is not necessarily the same as the optimal structure for creating value. Closed for comment; 0 Comments.
- 10 Dec 2009
- Working Paper Summaries
State Owned Entity Reform in Absence of Privatization: Reforming Indian National Laboratories and Role of Leadership
Is privatization necessary? In India and across emerging markets, state-owned entities (SOEs) continue to make up a large proportion of industrial sales, yet they lag behind private counterparts on performance measures. But SOEs may be able to significantly improve performance even in the absence of property rights, according to HBS doctoral candidate Prithwiraj Choudhury and professor Tarun Khanna. As they document, 42 Indian state-owned laboratories started from a base of negligible U.S. patents, yet in the period 1993-2006 (during which the Indian government launched an ambitious privatization program), the labs were granted more patents than all domestic private firms combined. The labs then licensed several of these patents to multinationals, and licensing revenue increased from 3 percent to 15 percent as a fraction of government budgetary support. Findings are relevant to firms and R&D entities around the world that depend on varying degrees of government budgetary support and government control, especially in emerging markets like India, where SOEs control up to one-third of all industrial activity. Key concepts include: Despite the absence of property rights, 42 Indian state-owned laboratories significantly increased U.S. patents and licensing revenue from multinationals without negatively affecting publication quality and quantity. This development may be due to incentive policy change and leadership change at the labs. U.S. patents as well as revenue from multinationals increased sharply in response to director changes, an event whose timing was dictated by rigid government employment rules. Private firms including multinationals can play a catalytic role in driving up revenue at SOEs. The state-owned labs leveraged the U.S. institutional context in effecting their turnaround. The general point is that organizations in emerging markets can leverage institutions from outside their location of origin, once they have some established source of competitive advantage (in this case, their R&D-generated know-how). Although the labs were able to commercialize projects without sacrificing publication quality and quantity, a question remains as to whether and why national labs should concern themselves with commercialization. Closed for comment; 0 Comments.
- 01 Jul 2009
- Working Paper Summaries
File-Sharing and Copyright
The researchers argue that file-sharing technology has not undermined the incentives of artists and entertainment companies to create, market, and distribute new works. The advent of new technology has allowed consumers to copy music, books, video games, and other protected works on an unprecedented scale at minimal cost. Such technology has considerably weakened copyright protection, first of music and software and increasingly of movies, video games, and books. While policy discussion surrounding file-sharing has largely focused on the legality of the new technology and the question of whether declining sales in music are due to file-sharing, the debate has been overly narrow. Copyright protection exists to encourage innovation and the creation of new works—in other words, to promote social welfare. This essay analyzes the landscape and identifies areas for more research. Key concepts include: Digital technology has lowered the cost of producing movies and music and allowed artists to reach their audience in novel ways. It's difficult to argue that weaker copyright protection has had a negative impact on artists' incentives to be creative. File-sharing has not discouraged authors and publishers. The publication of new books rose by 66 percent over the 2002-2007 period. Since 2000, the annual release of new albums has more than doubled, and worldwide feature film production since 2003 is up by more than 30 percent. How markets for complementary goods (such as concerts, electronics, and communications infrastructure) have responded to file-sharing remains largely unexplored in academic research. Closed for comment; 0 Comments.
- 13 Apr 2009
- Research & Ideas
Kind of Blue: Pushing Boundaries with Miles Davis
Since it hit the airwaves half a century ago, Kind of Blue by Miles Davis has influenced the hearts and minds of jazz fans everywhere. Its songs became instant classics, and it has also converted many a nonfan to appreciate the music's subtlety and complexity. In a new business case, HBS professor Robert D. Austin and Carl Størmer highlight the takeaways for thoughtful managers and executives from this story of creation and innovation. Closed for comment; 0 Comments.
- 09 Jun 2008
- Lessons from the Classroom
Monetizing IP: The Executive’s Challenge
Many companies fail to develop a strategy around protecting and monetizing their intellectual property. In this Q&A, Harvard Business School professor Josh Lerner discusses current trends in IP including the rise of patent pools. Closed for comment; 0 Comments.
- 04 Apr 2008
- What Do You Think?
Who Owns Intellectual Property?
Online forum now closed. Is intellectual property becoming community property? While the impact of change on the valuation of IP is of concern to some respondents, others wonder whether the issues are overblown. HBS professor Jim Heskett sums up responses to this month's column. Closed for comment; 0 Comments.
- 13 Nov 2006
- Research & Ideas
Science Business: What Happened to Biotech?
After thirty years the numbers are in on the biotech business—and it's not what we expected. The industry in aggregate has lost money. R&D performance has not radically improved. The problem? In a new book, Professor Gary Pisano points to systemic flaws as well as unhealthy tensions between science and business. Key concepts include: The biotech industry has underperformed expectations, caught in the conflicting objectives and requirements between science and business. The industry needs to realign business models, organizational structures, and financing arrangements so they will place greater emphasis on long-term learning over short-term monetization of intellectual property. A lesson to managers: Break away from a strategy of doing many narrow deals and focus on fewer but deeper relationships. Closed for comment; 0 Comments.
- 03 Apr 2006
- What Do You Think?
Has Globalization Reached Its Peak?
A new book argues that globalization has led corporations to outsource too much of their work and, more important, their intellectual capital. What with the increasing fluidity of labor markets, is it all too much for global managers to handle? Closed for comment; 0 Comments.
- 06 Feb 2006
- Research & Ideas
Sorting Out the Patent Craze
Some companies patent anything that moves to block innovation by competitors. But what does this mean for standard setting organizations? Professor Josh Lerner explains the challenges facing SSOs in this HBS Working Knowledge Q&A. Closed for comment; 0 Comments.
- 24 Oct 2005
- Research & Ideas
IPR: Protecting Your Technology Transfers
Countries are adopting stronger intellectual property rights to entice international corporate investment. But who really benefits from IPR? Should multinationals feel secure that their secrets will be protected? A Q&A with professor C. Fritz Foley. Closed for comment; 0 Comments.
- 04 Oct 2004
- What Do You Think?
Does Speed Trump Intellectual Property?
Speed can enhance product development and innovation, but speed can also be used effectively by fast imitators to both save design costs and preempt market share. Closed for comment; 0 Comments.
- 03 Mar 2003
- Research & Ideas
Top Ten Legal Mistakes Made by Entrepreneurs
The life of a startup can be precarious, a wrong turn disastrous. Harvard Business School professor Constance Bagley discusses the most frequent legal flops made by entrepreneurs, everything from hiring the wrong lawyer to puffing up the business plan. Closed for comment; 0 Comments.
Intermediaries for the IP Market
Some assets are traded in liquid markets with the help of many, thriving intermediaries: houses and apartments, financial products, books, DVDs, electronics and all sorts of collectibles. Intellectual property (IP) in general, and patents in particular, are not among those assets. In fact, one could argue that the market for patents is one of the last large and inefficient markets in the economy. IP is the ultimate intangible asset and extremely hard to value. Moreover, there are high search and transaction costs on both sides of the market, and the risk of litigation makes all potential participants even more cautious. Despite these difficulties, there could be attractive opportunities to create intermediation mechanisms to match patent creators with patent users and facilitate transactions between them. In recent years, a variety of novel intermediaries has emerged, all using different business models while attempting to bring more liquidity to the patent market. In this paper, Andrei Hagiu and David Yoffie explore the fundamental economic issues responsible for the low liquidity in the market for patents and provide a brief overview of patent intermediaries. They next focus on platform-type intermediaries (i.e., who enable search and transactions without ever taking possession of IP assets) and discuss the reasons for their lack of traction to date. The authors then turn to merchant-like intermediaries and the factors that have made them comparably more successful and influential than platforms. Finally, they discuss efficiency questions raised by patent intermediaries. Key concepts include: Platform-type IP intermediaries have failed to achieve meaningful scale. In contrast, some of the merchant-type IP intermediaries have become quite influential and profitable. The question remains whether merchant-type IP intermediaries have created any meaningful, market-wide efficiencies, as opposed to having simply thrived by exploiting existing inefficiencies and imposing a tax. The perspective of end-consumers is important. Because of litigation, merchant-type IP intermediaries would seem to be at least partly responsible for the current "patent bubble," which arguably leads to higher consumer prices. Closed for comment; 0 Comments.