While patents and trademarks can be among the most valuable of all intangible assets, they can also quickly become a major and impenetrable cost center, costing many companies hundreds of thousands or millions of dollars annually.
However, the good news is that the cost of IP portfolios can be significantly reduced (anywhere from 20% to 80%) without any reduction in protection, scope or quality by being smarter about the ways intellectual property rights are managed.
EverEdge’s Streamline™ intellectual property (IP) rationalization service helps companies to right-size their IP portfolio to save time and money.
Patents & Trademarks Can Become Very Expensive
Data from the US Patent and Trademark Office shows that only 5% patents ever make any money at all and fewer than 2% cover their costs. Given that the cost of holding a patent in even a small number of countries can exceed $1M over the life of the patent, maintaining even a few surplus patents can rapidly become very expensive. For companies with even modest portfolios these costs can quickly become a major line item.
Likewise with trademarks, it is common for businesses to build up legacy portfolios of hundreds, thousands or sometimes even tens of thousands of trademarks, which can lead to a steady and painful cost escalation.
Why Traditionally it’s Been Hard to Keep Intellectual Property Costs Under Control
For many CFO’s, trying to get to grips with intellectual property costs is a frustrating, time consuming and often fruitless exercise for several reasons, including:
- R&D activities often generate patent filings (which is a good thing) but over time this can lead to significant problems if portfolios aren’t regularly reviewed, including:
- Patents becoming irrelevant.
- A reluctance by management to acknowledge that past R&D may not have generated expected outcomes, or
- A fear of cutting a patent that may actually hold value.
- Patents are complex, legal abstractions that few outside the IP field understand and there is an inherent reluctance to cut costs in an area CFOs and others struggle to understand.
- With the best will in the world, external patent attorney firms have an in-built incentive to encourage clients to file and maintain patents, making it difficult to get a truly independent, second opinion on which patents to keep and which to cull.
Trademarks suffer from similar problems. It is common to find trademarks for products or services that have long since been abandoned but with high turnover in marketing and product teams it is common for “zombie trademarks” to continue creating costs for no real benefit.
In the case of both patents and trademarks, portfolios can quickly become impenetrable to non-legally trained outsiders and the costs and (perceived) risks of pruning the portfolio seem to outweigh any potential benefits.
A New Risk-Free Approach to Reducing IP Costs
Drawing on the experience of some of the world’s top ranked IP strategists EverEdge Streamline™ is designed to help companies right size their IP portfolios. Through this process it is common for us to identify cost savings of between 20% and 80% of annual spend from our clients IP portfolios, with no reduction in quality or scope of protection.
Streamline™ has a unique business model: we are paid from the savings we create for our clients. Importantly our clients maintain control and have the final call on what assets to keep and what to remove. It is suitable for customers with registered rights portfolios containing just a few rights up to tens of thousands.
In a medium sized portfolio, we have been able to frequently identify tens of thousands to millions of dollars in annual, bottom line savings. In some cases, we have achieved cost savings of 30% with no reduction in the number of assets at all, simply by improving how third-party legal providers are managed.
Examples of cost savings we have helped our clients achieve through Streamline™ include:
- Case Study 1: Major technology player: 5,000+ patents. Streamline™ identified ongoing cost savings of $4,000,000 per annum.
- Case Study 2: Large primary sector firm: 1,000+ trademarks, 300+ patent families. Streamline™ identified ongoing cost savings of $400,000 per annum.
- Case Study 3: Major industrial firm: 750+ trademarks, 50+ patent families. Streamline™ identified ongoing cost savings of $200,000 per annum.
- Case Study 4: Medium manufacturer: 800+ trademarks, 20+ patent families. Streamline™ identified ongoing cost savings of $250,000 per annum.
- Case Study 5: Major hospitality player: 400+ trademarks. Streamline™ identified ongoing cost savings of $50,000 per annum.
A further additional benefit of Streamline™ is that in some cases the rationalization project will logically lead to commercial conclusion of R&D or brand projects that are unlikely to generate a positive outcome for the company thereby generating additional (often larger) savings (which we do not take any share of).
Why Work With EverEdge
EverEdge is the only provider to work on a share of cost approach – this a game changer. We are almost globally unique in being independent from the patent attorney industry: although we employ patent attorneys we do not file patents or trademarks, ensuring the advice we provide advice about which assets to keep and which to rationalize is independent, objective and unbiased.
EverEdge consultants have been ranked among the top intellectual property strategists in the world for the last eight years consecutively so you will benefit from best in breed intellectual property strategy and insight capabilities.
If you are interested in how EverEdge Streamline™ can deliver immediate, bottom line benefits for your business contact us today for a free one-hour consultation.