“There is still some uncertainty and much at stake in the U.S. IP market. IP owners and their providers need to be prepared to address future volatility brought on by the lingering pandemic and its consequences, both economic and otherwise.”
The COVID-19 pandemic has caused a dramatic shift in how IP professionals manage their patent and trademark portfolios. Fortunately, many IP law firms and corporate IP departments have survived and managed well in this new environment. They are even showing great optimism as the industry trends toward greater consolidation and tighter global integration. Nonetheless, major concerns remain, challenging both IP owners and their advisers to find more effective ways to solve their portfolio management challenges while focusing on the long-term strategic value of IP.
In a recent report, we surveyed more than 500 IP professionals around the globe, including nearly 200 in the United States. This research revealed three critical pain points for IP owners in the post-pandemic world, from the need to demonstrate IP value to the challenges inherent in IP management, including that of balancing cost and complexity.
The findings also emphasized the need for IP service providers to help clients to achieve more with less in these uncertain times, addressing these three challenges through the right mix of IP advisory and administrative services, as well as efficient use of technology.
1. Add Value to Your IP Portfolio
The increasing importance of IP to global success is reflected by the exponential rise in IP registrations over the last decades. Most recently, the 2020 World Intellectual Property Office (WIPO) Indicators report showed that global patent filings have nearly doubled from 2005 to 2019, while trademark filings have quadrupled.
Yet nearly four in ten of the U.S. survey participants said they struggled to communicate the value of IP to internal stakeholders. They are increasingly being tasked to show the significance of the company’s IP investments and are looking to service providers for strategic counsel and data-driven insights to help them make their case to these stakeholders.
A similar picture exists for IP enforcement, with U.S. patent litigation continuing to climb in 2020. The research reveals that 42% of U.S. respondents view domestic IP enforcement as a key challenge, while 40% cited international enforcement as their biggest headache at present.
History has shown that companies that invest in innovation during challenging times emerge in a stronger position. Indeed, when times are tough, investing in IP assets can not only help businesses to survive, but also give them a huge competitive advantage and drive economic growth. Nonetheless, when finances are restricted, budgets will be under pressure. Balancing the need to protect the revenue driven by IP and using it to expand business opportunities, at the same time as dealing with cost pressures, makes efficient budget spending even more critical.
2. Reevaluate IP Strategies and Technology
The global IP regulatory landscape is fragmented and complex, requiring a flexible and informed approach to domestic and international IP management. At the same time, increased scrutiny on IP budgets and activities requires IP professionals to demonstrate value and justify budgets. The days of simply renewing rights – or supplier agreements – are long gone; in their place, is a focus on return on investment and transparency, and a desire to better align IP strategies with a company’s overall goals.
This is likely why 40% of U.S. survey respondents said they need to invest more time and money into IP advisory and strategic services, while 37% said they need to realign their IP and business strategies.
The need for state-of-the-art digital technology has also heightened during the pandemic, as IP professionals have switched to remote working. The desire to improve global portfolio management and to better connect with colleagues, clients and partners is nothing new, but technological barriers have become more acute at this time of enforced social distancing, driving the need for real and substantial change.
Only about a quarter of U.S. participants said their current technology meets their needs and just under half said their IP tech is no longer up to date. There is also a need to adopt advanced technology, such as software-as-a-service and cloud platforms, to help manage complex IP portfolios.
3. Reduce Cost and Complexity
Succeeding in this new environment requires smart, cost-effective solutions to access targeted IP advice and execute administrative tasks in an efficient and streamlined way.
We’re all aware of the accelerated consolidation among IP service providers in recent years, fueled in part by private equity investment that has helped fund M&A activity. The survey found that 65% of respondents see a positive impact from this consolidation in the U.S. (78% of IP/law firms). Those who work in automotive/aviation, energy/utilities and technology/media were especially optimistic. Indeed, consolidation is producing many benefits for IP professionals, who are constantly seeking more holistic strategies that include both IP services and counsel “under one roof.”
To be successful, IP service providers need to provide a global and modular approach to IP service delivery, so that clients can pick and choose the support they need from a complete global package of expertise. Complex IP portfolio management issues require flexible solutions, so that IP owners and their chosen external providers can benefit from custom solutions, pricing transparency, and a flexible approach to technology. This will help drive down the costs and complexity of managing multiple provider relationships.
There is still some uncertainty and much at stake in the U.S. IP market. IP owners and their providers need to be prepared to address future volatility brought on by the lingering pandemic and its consequences, both economic and otherwise. Amid this backdrop, globalization and digitization are moving ahead at breakneck speed. Those who are consistently reassessing their portfolio strategies with smart IP solutions, while finding creative ways to cut costs, will be better equipped to showcase their global value to stakeholders, execute on their vision and grow their businesses.
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