Technology & Product Licensing

Technology and Product Licensing

After a patent or other form of intellectual property (IP) is created, the owner of said IP asks how it can be exploited to best benefit. If it’s not in the IP developer’s interests to manufacture and market the product, the options for exploiting the IP are licensing or an outright sale of the IP rights.

An outright sale or assignment of the IP is a “one-off” transaction where the technology is bought or sold for an agreed price. For products that are untested in the marketplace and have little or no market history, an outright sale of the IP is relatively uncommon because of the difficulty in quantifying the value of the IP to the satisfaction and expectations of both buyer and seller.

A license* is a covenant or agreement from a licensor (owner of the IP) to a licensee (usually a manufacturer) authorizing the use of the intellectual property to make, use and sell the products embodying the technology in exchange for a monetary royalty. Said license also specifies the manner in which the technology can be used, the time period and territory or region. The licensor typically retains ownership of the IP asset and licensing is a way of creating a return on said asset.

The major advantages of licensing for a licensor are as follows:

Access to manufacturing and distribution capabilities
Roll out of the technology can be achieved simultaneously in multiple national and international territories and fields of use
Licensing can be used to legalise infringers or competitors

Disadvantages of licensing for a licensor are primarily non-performance and or infringement by licensees which can often be larger, better funded, geographically distant and/or litigious.

*The term “license” refers to intellectual property and can apply to technology licenses, publishing and entertainment licenses, trademark, software and merchandising licenses. In the context of Alchemy’s services, licensing refers specifically to technology licenses only.

To find out more about technology & product licensing click here.

Please feel free to contact Alchemy on +1300 308 882 for a detailed explanation of what each of these products or services entails including our affordable pricing.