Monthly Archives: August 2012

Safeguarding your Intellectual Property assets

200x200-Martin2.jpgIntellectual property is about much more than just patents and your firm must protect these assets, writes Martin Brassell, chief executive of Inngot

To get an idea of the strategic importance of “intellectual assets” in general, take a look at how value is assigned to FTSE 100 companies. Back in the 1980s, market capitalisation and balance sheet asset values followed each other closely. But look at the top businesses today and you will find that up to 80% of their value no longer relates to “hard assets”. The difference is accounted for by a whole range of intangibles, which need to be properly protected.

To read the full article click here

Visit www.inngot.com today to find out more..

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Careful with that copyright

Just because copyright is automatic, it doesn’t mean you can let it look after itself

By Martin Brassell, CEO Inngot.com | Source & Publisher– Computerworld UK | View the article here

Much of the debate around copyright law is currently focused on its (in) ability to protect artists’ original works, at a time when their predominantly digital format makes rip-offs easier than ever. But copyright is also a fundamental right for software of all kinds, versatile and wide-ranging – and as well as ensuring your business benefits from it, you need to ensure you don’t fall foul of it either.

At first sight, it may seem incongruous that the law treats software in general as an “original literary work” – but in fact it’s very appropriate, considering that code is now often constructed using language that even non-programmers can recognise. And it covers more than you might think. Tables and compilations are covered under the relevant law (Part I of the Copyright, Designs and Patents Act 1988), as well as lines of computer code. Your basic rights as a copyright owner include copying (no surprise there), public sale, performance, broadcast and adaptation.

Interestingly, “adaptation” includes conversion into a different computer language or code – so it’s not acceptable for someone to “translate” your software and claim it as their own. And all these rights apply to the whole work, or any substantial part of it. Case law (for instance in the context of recorded music) suggests that a “substantial part” can be a pretty small element, if it is distinctive of the work as a whole.

  • International copyright development and the concept of fair use

Of course, no form of intellectual property protection really safeguards an idea, because copyright, patents and designs don’t prevent someone designing around your innovation (in fact it’s worse than that – a patent discloses exactly how you’ve created something, thereby making it easier for others to design around your work). But in software, more than any other creative domain, it can be perhaps argued there is no longer a clear distinction between the expression of an idea and the idea itself.

A great benefit of copyright is that it is very long-lasting. In the case of software, the clock starts ticking when the code is first written, and the alarm doesn’t go off for up to 50 years, so your market opportunity will have run out long before your protection does. Best of all, the rights exist automatically in a work once it is first “recorded” – there’s no need for statutory registration in order to get legal protection.

However, it is very important to draw attention to your copyright at every opportunity, and not just to put people off from copying you. You need to preserve all your rights, including damages and injunctive relief, in case someone infringes your work. If an offending party does not know, and has no reason to believe, that copyright exists, your right to damages is lost (this is where the absence of formal registration has its downsides, and is one of the areas we are seeking to remedy with Inngot.com).

The assertion process is fairly straightforward – the familiar © mark followed by your company name, the date and the phrase “All rights reserved” will normally suffice. Then you can sell, assign or license copyrighted software, in whole or in part, just like any other piece of personal property. To do that, of course, you have to tell people that it is available but more than anything else, you will need to be able to prove that you really own it. Straightforward, yes?

Not necessarily. If all development has been done in-house by employees of your business, there should be no issue. Under the Act, literary or artistic works made in the course of employment generally belong to the employer, in the absence of any agreement to the contrary, and computer-generated works don’t provide for a “moral right” to be identified as an author.

However, you will need to be confident that your developers haven’t “borrowed” chunks of code they’ve previously created for other people, or lifted them from any other application that is subject to someone else’s copyright. If they have, be aware that if any offence is committed by a company with the consent or connivance of a director, manager or company secretary, then you too can be found guilty of infringement.

The most common problem arises when a business wants to sell off work which has been done in whole or in part by subcontractors without providing for transfer of copyright ownership. This shouldn’t be difficult, since the law allows for copyright to be assigned even before any code has been written. The problem is more often a practical one; if some dispute arises over the quality or timeliness of the work done, the subcontractor has an incentive to hold the rights as hostage in order to extract payment.

Overall, though, the great appeal of copyright is that it is designed to protect goods that are meant to be sold. And in the case of digital media sales, it’s not the law that needs fixing: it’s the business model that’s broken.

Martin Brassell is CEO of Inngot.com, a new online marketplace that enables companies to publicise their IP, including copyright protected software, in a secure environment and use it to find customers, partners and funding.

Visit www.inngot.com today to find out more..

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Protecting your Intellectual Property: The answer could be right under your nose

By Martin Brassell, Chief Executive, Inngot.com | Computerworld UK |

Compare a company’s market capitalisation with its tangible assets and you’ll find a gap of up to 75%, which IP experts assure us rests in intangible assets.

However, in a survey, the Intellectual Property Office who issue patents in the UK found that 86% of UK businesses were either ignorant or misinformed about how to protect and make best use of these “valuables”. The survey was conducted in 2006, but there is little evidence that things have improved since.

If UK plc is to pull its way out of recession based on innovation (as the government seems to believe), companies need to get better at understanding their intellectual assets, and leveraging their knowledge and technology to get finance and business through the door.

The IPO says the problem is particularly acute among smaller businesses: “SMEs and the mass of micro-enterprises (businesses with 0-9 employees) which form the cradle of IP and future large companies are in the main effectively unaware of the IP system”.

This assessment does seem unduly pessimistic, and reflects the fact that current debate too often focuses on formal registered rights, especially patents, as being synonymous with IP.

There is no doubt that for some businesses patents are helpful or even essential, but they do not sit well with knowledge economy companies, especially those whose innovations lie in software.

The patenting process often requires specialist expertise, making it costly (officially estimated at up to €50,000 for an EU patent) and time-consuming: the fastest I have personally encountered took some 17 months from filing to publication date, and 2-3 years is more normal.

In a world moving towards increasingly open models of innovation, this combination of high cost, lengthy time to market and defensive intention makes patents an appropriate option only in a limited number of situations.

In fairness to the IPO, strong rights should be backed by rigorous processes, and these will take time – once an application has been submitted, the IPO checks it against existing published patents, and if the application passes this process then a patent is granted, normally in the two to three year time period.

But many small firms now question how advantageous these rights really are in practice, given that their large competitors often have sufficient financial muscle to render patents very difficult to enforce.

Surely the answer is broader and simpler – it’s to make more of copyright. While it’s recognised that copyright is fundamental to creative works, many of which are now digital, its importance as the underlying right to protect all types of software is not well understood, other than in the context of piracy.

Copyright is automatic and it’s long lasting; it’s remarkably consistent internationally; it can be used to sell, assign, transfer or licence intangible assets; it can even be assigned in works that are not yet complete.

In working with young businesses over many years I learnt to be wary of any proposition that seemed to require legislative change. The good news for business in the digital age is that we already have the legal framework we need – we just have to capitalise on it better.

Martin Brassell is CEO of inngot Limited- It provides a safe and secure place for IT companies to register their intangible assets enabling companies to ‘showcase’ their IP to find customers, partners and investors.
He is also a South East England Development Agency (SEEDA) Hub Director, working to assist high potential new ventures.

Visit www.inngot.com today to find out more..

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Attitudes to secured lending: Are we living in the past?

How can identifying your companies intangible assets benefit your organisation?

It’s no use trying to address 21st Century funding needs by focusing on 19th Century assets for secured lending. We need to learn lessons from the past, and apply them to the challenge of growing the knowledge economy

Given the current turmoil in the Eurozone, there’s no shortage of commentary on structural issues facing markets. The finger is being firmly pointed at the connection between low-cost debt and burst property bubbles. Meaning banks are sitting on portfolios that no-one can shift.

We’ve blogged before on the fixation that financiers seem to have on what they see as solid assets. But in fairness, we should explain that secured lending has a long and honourable tradition. In fact, there is a lot it can still teach us.

Back in the industrial age, in the 19th century (and much of the 20th), the most important assets in a business were indeed tangible ones. Companies created value by mechanising processes which had hitherto taken large numbers of people to accomplish, and allowed goods to be produced on a scale and to a quality never before seen. This required big ‘things’ like factory buildings and equipment, and companies often lacked the cash reserves to acquire use of the assets they needed in order to expand.

Secured lending emerged as an imaginative and highly effective solution to this problem. It enabled businesses to leverage both the assets they wanted to acquire, and the assets they already had, thereby providing the security banks needed to lend money for growth. A real win-win.

These assets were crucial when the key determinant of a company’s success was its ability to multiply manpower. Businesses were well motivated to repay their loans, and from a bank’s viewpoint, if things got sticky and company A got into difficulties, there was a good chance company B could use the same tools or machinery productively.

So how does this translate into the knowledge economy, where competitive advantage is about offering something unique and distinctive – about multiplying brains, not brawn?

In theory, rather well. While the key value-producing assets are now intangible not tangible, they are assets nevertheless. All the most important ones (patents, brands, distinctive designs, software copyright and so on) all have property rights associated with them which means they can be bought and sold (or charged, or leveraged) just like anything made of metal. Supply problems with any of these assets will interrupt value production just as surely as a hardware failure – the difference being that you can’t simply bring in a new machine to solve it. So that’s good news for secured lenders, as it means these assets are more business-critical.

So why, on the rare occasions that lenders do acknowledge intangibles within a deal, do they take such ineffective security over them, like a floating charge? The truth is that they find intangible assets difficult to understand. The detailed appraisal process that will go into assessing a tangible ‘thing’ is not entered into with intangibles, meaning there is no ‘clear line of sight’ – and we all now know how dangerous that can be.

In a nutshell: as the seat of value has shifted – decisively so, in the last 40 years – companies have moved with it, but lending habits generally have not. There is only one thing wrong with 21st century asset-backed lending: it is still focused on 19th century assets.

As the US-based Athena Alliance has put it: “Just as physical assets were used to finance creation of more physical assets during the industrial age, intangible assets should be used to finance creation of more intangible assets in the information age.”  We couldn’t agree more.

Visit www.inngot.com today to find out more..

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New Intellectual Property resource centre for innovators – IP Central

Inngot is working with the Technology Strategy Board and the Intellectual Property Office to provide IP Central, a community network providing resources on all aspects of IP, hosted on the TSB’s _connect platform.

The aim of IP Central (which can be found at connect.innovateuk.org/web/ipcentral) is to provide convenient access to the practical Intellectual Property information and advice needed by innovators, with a special focus on those seeking to partner and collaborate. This is a requirement for the TSB’s challenge-led funding programmes, but often appears complex and challenging to those approaching it for the first time.

The _connect system now has nearly 40,000 registered individuals, and provides the online platform for all Knowledge Transfer Networks. Inngot has already provided IP support to a number of KTNs (including managing the Beacon Project on IP and Open Source for the Creative Industries KTN): it will be ensuring that IP Central has a sector-agnostic approach, welcoming contributions and questions from all creative and technological fields.

The IP Central community network is grateful for the support of the Intellectual Property Office, who have kindly provided a range of useful documentation. This ranges from basic guides to patents and trade marks to the latest Lambert Agreement templates to help organisations formulate successful licensing agreements.

Membership of IP Central is free. The community network can be found by clicking the link above, or searching “ip central” on the connect platform.

Visit www.inngot.com today to find out more..

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