UNIVERSITY RESEARCH, INTELLECTUAL PROPERTY RIGHTS AND EUROPEAN INNOVATION SYSTEMS

Abstract This paper surveys the literature on university patenting. From the point of view of the economic theory of patents, it is argued that patenting knowledge developed by university researchers is paradoxical: patents are normally intended to stimulate knowledge development by providing property rights, but universities operate also under a different incentive scheme, i.e. they receive public funds to perform socially useful knowledge. In the debate surrounding the so‐called Bayh‐Dole Act in the USA, it has, however, been argued that patents on university inventions may be necessary to stimulate technology transfer from universities to private firms. The first part of the paper addresses two major questions. First, what is the economic logic of Bayh‐Dole, and, second, what were the effects on universities and the knowledge they develop? In the second part, the paper addresses the issue of whether ‘Bayh‐Dole‐like’ legislation would be beneficial for European countries. In a number of European countries, a suggestion has been made that this could enhance knowledge transfer from the public to the private sector. Using a new database resulting from a survey among patent inventors in six European countries, an assessment is given of the degree of university patenting in Europe. Because university researchers are often involved in patented inventions without the university being listed as a patent applicant, statistics based on the patent office databases alone often underestimate university patenting in Europe. The paper ends with a discussion of how this ‘European practice’ of university patenting affects public–private knowledge transfer in Europe, and how this compares to the effects of the Bayh‐Dole Act in the USA.     

Adding business value: a strategy for identifying and patenting environment‐related inventions and avoiding patent infringement

For many environmental companies, reaching financial goals is a function of identifying and protecting intellectual property assets, keeping those assets from falling into the hands of competitors and avoiding litigation disputes over the use of those assets. Recognizing that intellectual assets are valuable tangible and intangible assets of a company is the first step in maximizing the value of those assets. However, many environmental companies are not aware that some of their technologies, ideas, concepts and know‐how are potentially patentable and, therefore, fail to maximize the value of those assets by taking advantage of the limited monopolies that patent systems provide to the owners of patents. In the ever‐increasing competitive global market, companies should evaluate their intellectual assets to ensure they are adequately protecting those assets by obtaining patents for ideas that are patentable. As more patents for environmental technologies issue from patent offices around the world, however, the likelihood of infringing one of those patents can increase. Therefore, avoiding infringing others' patents while at the same time identifying and patenting the company's own technologies should be a key business strategy regardless of the size of the environmental company. Copyright © 2003 John Wiley & Sons, Ltd. and ERP Environment     

Project Management–Related Software Systems and Their Legal Protection: Emergence,Distribution, and Relevance of Business Method Patents

The legal protection of project management–related software systems has changed recently, as patenting is spreading to the area of business methods. We investigate which parts of project management are especially confronted with this form of legal protection and how software system providers deal with this topic. Almost all the tasks of project management are permeated by business method patents but the intensity of these tasks differs remarkably. Their assignment—related to major project management software system providers—is unbalanced. While patenting‐experienced companies have already learned how to use business method patents to gain advantages in project management environments, many others have not.     

Commercializing Open Science: Deep Space Communications as the Lead Market for Shannon Theory, 1960–73

Recent research on the commercialization of scientific discoveries has emphasized the use of formal intellectual property rights (notably patents) as a mechanism for aligning the academic and entrepreneurial incentives for commercialization. Without such explicit intellectual property rights and licensing, how is such open science commercialized? This paper examines the commercialization of Claude Shannon's theory of communications, developed at and freely disseminated by Bell Telephone Laboratories. It analyses the first 25 years of Shannon theory, the role of MIT in developing and extending that theory, and the importance of deep space communications as the initial market for commercialization. It contrasts the early paths of two MIT‐related spinoffs that pursued this opportunity, including key technical and business trajectories driven by information theory. Based on this evidence, the paper provides observations about commercializing open science, particularly for engineering‐related fields.     

Logics,Leaders, Lab Coats: A Multi‐Level Study on How Institutional Logics are Linked to Entrepreneurial Intentions in Academia

Situated in the context of academia, this study integrates ideas from institutional theory, person‐environment fit theory and leadership research to conceptualize and examine the cross‐level link between the organizational‐level institutional logic of research commercialization and the entrepreneurial intentions of researchers. Multi‐level analyses based on a sample of 254 researchers working for 85 research group leaders in 49 German research institutes reveal that two distinct attributes of research group leaders – that is, their track records of entrepreneurial behaviour and their entrepreneurial intentions – play a significant role in transmitting the organizational‐level logic to the individual level. We also observe a complementary interaction between organizational‐level commercialization logic and the entrepreneurial track records of leaders. We discuss how these findings advance our understanding of science commercialization through academic entrepreneurship and how they inform institutional theory and theory development in other domains of entrepreneurship research.     

Commercialization of university inventions: Individual and institutional factors affecting licensing of university patents

This paper conducts a unique study using the university patent as the unit of analysis to determine how individual and institutional factors affect the likelihood that a patent will be licensed. Using a 2010 national survey of academic scientists in the United States in which respondents were asked specific questions about 2006 patents for which they were listed as inventors, we find that the likelihood of licensing is significantly determined by individual factors including inventors׳ attitude towards commercialization of research, additional research conducted during patent review, and collaboration with industry scientists on the underlying research. Among institutional factors, university Technology Transfer Office׳s cost-saving measures positively influence licensing, but industry funding and TTO service effectiveness do not. We also identify two types of inventions: opportunity-based inventions are discoveries that are not foreseen patentable at the outset of projects; intention-based inventions occur on research projects that anticipate commercial outcomes before the start of research. Findings demonstrate that different individual and institutional factors contribute to licensing of these two different inventions. This study provides new insights into the process of commercialization of university inventions.     

The DNA of Enterprise: Jane Jacobs and Henry George on Innovation and Development Through Spin‐Offs

The main training grounds for entrepreneurial, technical, and business capacities are existing businesses. There are two ways that this training can lead to new growth—just as there are two ways that existing biological DNA can lead to the growth of bio‐mass, namely, (1) existing organisms getting bigger or (2) by spinning out offspring who in turn can spin out more offspring. Where growth has been vibrant, e.g., Silicon Valley, it has followed the second route, growth by offspring. This is also the biological principle of plenitude. Conventional ownership structures lessen the incentives for spin‐offs since managers do not want to reduce the “empire” under their control. The biological principle of plenitude is best implemented with employee‐owned or cooperative firms (e.g., as in the Mondragon cooperative group). Inspired by ideas first proposed by Henry George and Jane Jacobs, this article explores the social benefits of applying the biological principle of plenitude by encouraging the proliferation of enterprises. This poses a conundrum for societies organized around the private business model: How can the social benefits of spin‐offs be realized when managers do not have an incentive to foster new businesses? We conclude with ways to address this problem.     

Research and Technology Commercialization

This paper introduces the special themed section on organizational interactions involving universities and firms that result in the commercialization of research and technology. Our objective is to shed light on some of the most vexing, yet under‐researched predicaments research institutions encounter, despite their best efforts to advance commercialization. First, we synthesize and extend recent studies, including the papers in the special themed section. Next, we develop a taxonomy of modes of commercialization. Specifically, we consider internal approaches, quasi‐internal approaches (e.g. incubators), university research parks, regional clusters, academic spin‐offs and start‐ups, licensing, contract research and consultancy, corporate venture capital, and open science and innovation. We also identify areas for further research at the individual (e.g. heterogeneity of entrepreneurial teams and experience; incentives), organizational and intra‐university (e.g. corporate governance; nature of growth strategies; relationships with trading partners; boundary spanning activities) and technology levels (e.g. institutional context; reconfiguration of technology; valuation of technology).     

Patent-based investment funds as innovation intermediaries for SMEs: In-depth analysis of reciprocal interactions,motives and fallacies

SMEs and academic spin-offs play an important role in generating innovations but face resource and competency constraints that have implications for commercializing their technologies. In two in-depth case studies we analyze how patent-based investment funds (PBIFs), operating as innovation intermediaries, help overcome these constraints. In contrast to other patent intermediaries, PBIFs acquire patents and patentable inventions at an early stage of technology development when access to capital is particularly critical. They invest in the technological and legal advancement of their portfolio, which is mostly conducted in close interaction with the technology-providing SMEs and their original inventors. These PBIFs not only provide high added-value in the course of technology commercialization but also operate international networks to facilitate the commercialization of SMEs' technologies at an international scale. Although PBIFs are a promising new agent in the heterogeneous field of innovation intermediaries, their commercialization results and the actual rate of returns are not yet well established.     

The economic value of patent portfolios

Patent holders may choose to protect innovations with single patents or to develop portfolios of multiple, related patents. We propose a decision‐making model in which patent holders allocate resources to either expanding the number of related patents or investing in higher value of patents in the portfolio. We estimate the derived value equation using portfolio value data from an inventor survey at the level of individual inventions rather than the firm as a whole. We find that investments in individual inventions exhibit diminishing returns, and that a good part of the value of a portfolio depends on adding new patented inventions. Also, while diminishing returns to individual inventions are stable across subsamples, the returns to portfolio size vary between complex and discrete industries, and between inventions that are science‐based or driven by customer information. When firms seek to strengthen appropriability, the returns to an increase of portfolio size are not different from the sample average. Thus, a higher number of inventions in a portfolio may reflect both stronger appropriability via patents and genuine creation of value.     

Are patent fees effective at weeding out low‐quality patents?

The paper investigates whether patent fees are an effective mechanism to deter the filing of low‐quality patent applications. The study analyzes the effect on patent quality of the Patent Law Amendment Act of 1982, which resulted in a substantial increase in patenting fees at the U.S. Patent and Trademark Office. Results from a series of difference‐in‐differences regressions suggest that the increase in fees led to a weeding out of low‐quality patents. About 10% of patents in the lowest quality decile were filtered out, with the effect concentrated in the patents of firms whose overall patent portfolio was medium to large (more than 20 patents). The study has strong policy implications in the current context of concerns about declines in patent quality.     

Commercializing inventions resulting from university research: Analyzing the impact of technology characteristics on subsequent business models

One of the key challenges in commercializing inventions arising from academic research is deciding on an appropriate business model for transferring the invention from the academic world to the commercial world. However, there is little empirical evidence to suggest which model to choose. This study attempts to address this gap by examining how characteristics of technologies affect the selection of business models.We consider four characteristics of technology: patent or other legal protection, specialized complementary assets, commercial uncertainty and technological dynamism. We relate these characteristics to the choice of three basic business models for commercializing inventions. Data for this study were gathered for 42 commercialized inventions.We found evidence that greater patent or other legal protection for the technology was associated with a greater likelihood that the technology was commercialized by transferring limited rights to the technology to existing firms. We also found evidence that greater commercial uncertainty was associated with a greater likelihood that the technology was commercialized by creation of a new firm or transfer of the rights to the technology to an existing firm. We did not find evidence of a relationship between the importance of specialized complementary assets or technological dynamism and the business model used.     

Where is the entrepreneurship bang for the patenting buck? Utility versus design patents

This research contributes to the literature on entrepreneurship by studying whether design patents and utility patents have similar effects on entrepreneurial activity. Other contributions of this research include comparing the relative influences on startup versus established entrepreneurs and the effects of patents versus trademarks. Results, based on a panel of U.S. states, show that established entrepreneurs benefit from both types of patenting and from trademarks, whereas startup entrepreneurs significantly benefit from only design patents, and the effects of design patents and trademarks are opposite. These findings suggest that the entrepreneurship bang from the patenting buck might differ across patenting types.     

University spin-off programmes: How can they support the NTBF creation?

University researchers create technological opportunities that give rise to NTBF. The commercialization process of these opportunities is very complex, thus requiring universities to have programmes to support it (USOP). In this research 37 Spanish programmes, and 20 spin offs created with the support of the Technological University of Catalonia’s USOP (Innova Programme), have been examined. The study describes the technological opportunity creation, recognition and exploitation processes, and classifies the factors that determine it. Finally, the study develops a four-action-line-model that contributes to better understand how the activities carried out by USOPs minimize the barriers for spin off creation.     

Contributing to markets for technology? A comparison of patent filing motives of individual inventors,small companies and universities

We compare patenting motives of individual inventors, small firms, and universities to those of large firms. We use data from a survey (641 responses) among applicants at the European Patent Office. Our results from regression and factor analyses confirm significant differences among applicant types. The generation of licensing opportunities is rated as being more important if the applicant is a university, individual inventor or small firm. Blocking and prevention of imitation is rated as being less important if the applicant is a university. We interpret that this finding results from the universities' willingness to license under adequate conditions and their tendency not to use their patents for preventing the diffusion of their technology and its usage by others. Individual inventors and small firms place a higher importance on using patents as signals to investors, suggesting that patents are perceived as useful to secure access to the capital necessary to start or grow a business. Among all applicant groups, individual inventors attribute the most importance to blocking as a patent filing motive. This gives cause for concern because individuals who do not manufacture products on their own but, rather, use their patents to block others from production act as patent trolls.     

When patents matter: The impact of competition and patent age on the performance contribution of intellectual property rights protection

The question whether patenting impacts patenting firms' subsequent financial performance is important for technology-oriented companies. However, relevant research has led to contradictory results. We strive to overcome this impasse by introducing innovation competition and patent age as moderators of patents' performance contribution into the discourse. Based on a sample of 975 cases from diverse industries, we find strong support for our arguments. In line with our expectations, the results show that the number of patents granted, the degree of patent competition, and the timeliness of a patent contribute positively to financial performance. Moderation analysis nuances our findings by showing that the impact of patent protection on financial performance is stronger when the patent competition is stronger and the patents are younger.These findings provide insights into the conditions under which patenting leads to higher financial performance. Our findings highlight the importance of innovation competition and patent age for innovation research. The empirical results show firms that patenting pays and that, in order to tap the full potential of patents, they need to focus on emerging competing industries and reduce the time to market. Policy makers learn that patenting is a successful approach to foster innovation at limited social costs.     

Assigning Patents to Industries: Tests of the Yale Technology Concordance

We describe a method to predict patent counts disaggregated by industry, using available data on patenting by technology field. This method—the Yale Technology Concordance (YTC)—exploits a data set of patents that have been individually assigned by the Canadian Patent Office to both an industry and a technology field. The procedure for predicting patents by industry is developed as a statistical model so that the standard errors of the predictions can be estimated. The YTC is tested on several subsets of Canadian patents by comparing out-of-sample predictions with industry assignments made by the Canadian Patent Office. We find that the predictions of patents by industry are quite accurate for the subset of patents form US inventors. The prediction errors are much greater for the subset of patents granted or published after 1989. This suggests that the relationship between the technology fields and industries has shifted in a way that the procedure does not capture. Nonetheless, predictions from the YTC do appear to give a reasonably accurate picture of the pattern of patenting by industry.     

‘Repeat commercializers,’ the ‘habitual entrepreneurs’ of university–industry technology transfer

Among academic faculty, is there a class of ‘repeat commercializers’ who account for a disproportionate share of commercialized technologies arising from university research? In a survey of 172 engineering, mathematics, and science faculty members from a major Canadian university, we found evidence that a class of repeat commercializers does exist. Further, we found that the 12% of the faculty who are repeat commercializers account for 80% of the commercialized innovations. Interviews with repeat commercializers in the same faculties at the same university suggest that repeat commercializers parallel habitual entrepreneurs in that they have the ability to commercialize (i.e. the ability to generate and identify commercializable inventions and the ability to acquire resources for the commercialization of their inventions) and the aspiration to do so (i.e. commercialization-friendly attitudes). Since repeat commercializers account for such a large percentage of commercialization activity, it is important that programs and policies associated with technology transfer address the needs of this subpopulation of the faculty.     

Development of patent roadmap based on technology roadmap by analyzing patterns of patent development

Recently, patent forecasting and planning has been emphasized as an essential process in the strategic management of technology because well-planned patents will make larger profits and occupy dominant positions first. Thus, this paper aims to suggest the concept and process of a patent roadmap based on a technology roadmap and patterns of patent development. For this, first, ontology of technology is generated to structure the characteristics of technology based on the existing technology roadmap and then patents are collected from a patent database. Second, collected patents are grouped by similarities based on vectors of extracted keywords and grouping results are classified by TEMPEST. In this step, keywords extracted from the previous phase are matched with TEMPEST individually and patent groups are categorized in accordance with high relevance between representative keywords in patent groups and core keywords in each category of TEMPEST. Third, the patterns of patent development are identified for each patent group and categorized by two types – structural and temporal patterns. Consequently, extracted patterns serve as evidence of patent planning, and the patent roadmap is drawn with the technology layer composed of the technology roadmap and the patent layer that each group is mapped on. The proposed approach is illustrated by the case of the transparent AMOLED display. The patent roadmap will enable managers to establish patenting strategies in order to achieve a valuable core patent that has the potential to become a business model, yielding good returns in the long term.     

Patenting Strategy of Entrepreneurial Orientated Firms in New Zealand

Patenting is regarded as an important area for firms wanting to capture the strategic value of intellectual property. Further, patents are often used as a proxy for innovation— i.e., a firm with a large number of patents is said to be innovative. At the same time, a firm that is innovative is also said to have an entrepreneurial orientation (EO). In spite of this apparent linkage between an EO and patenting, little empirical evidence strategically links the two constructs. This paper addresses this gap by providing one of the first studies examining the relationship between an EO and patenting.