{"id":194330,"date":"2018-03-22T12:26:21","date_gmt":"2018-03-22T06:56:21","guid":{"rendered":"http:\/\/www.scconline.com\/blog\/?p=194330"},"modified":"2021-02-19T10:02:15","modified_gmt":"2021-02-19T04:32:15","slug":"open-innovation-and-intellectual-property-rights-a-paradox","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2018\/03\/22\/open-innovation-and-intellectual-property-rights-a-paradox\/","title":{"rendered":"Open Innovation and Intellectual Property Rights \u2014 A Paradox?"},"content":{"rendered":"

With globalisation and increasing competition, technological self-reliance has become a necessity. India has always believed in the middle\"\" path. It can be traced to the tendency in our cultural milieu to avoid extremes in any thought process. Intellectual property rights (IPR) management is no exception. However, while the law is evolving, the practices are changing even faster.\u00a0 The companies which traditionally held our hands on technology and supplied us know-how (at a price), have started to see us as a competitor. As a result of which in the recent years there have been several cases filed by Indian companies against other Indian companies demonstrating increasing awareness among the inventors of their rights. At the same time the case for open source technologies has also become quite strong. It is not just in softwares that one ought to be concerned about open source technologies, but even in hard technologies, the Government can incentivise innovators to bring their technologies in public domain. One can hybridise both IP and open source system protection among corporations and other organised sector entities but freedom to copy, improve, and learn from each other at the community level. Open innovation contrasts with the traditional \u201cclosed innovation\u201d model employed by the large vertically integrated firms which grew prominent during the twentieth century.[1]<\/a><\/p>\n

The most closely linked intellectual property relating to the open innovation is patents, and that is where the column focuses on. Most patent jurisdictions in the world were designed keeping in mind the lone inventor who, through the marshaling of extraordinary insight and experimental toil, conceives a novel invention. As a reward, the inventor is given the right to profit from his contributions through personal commercial exploitation. Open innovation suggested that this model can no longer be successful because the growth of alternative models of technology development challenges the competitive advantage of integrated R&D.<\/p>\n

Having established that intellectual property rights would often lock horns with the concept of open innovation, this column would like to explore how to manage one\u2019s intellectual property in order to successfully implement an open innovation model.<\/p>\n

What justifies an open innovation model?<\/strong><\/p>\n

Having established that the underlying philosophies of open innovation model and patent laws are polar opposites, it is safe to conclude that an open innovation model would be in conflict with existing patent laws. The question that needs to be asked is, what then, justifies the concept of open innovation model. Traditionally, patent doctrines look for a \u201cflash of creative genius\u201d in the invention as in Graham<\/em> v. John Deere Co. of Kansas City Calmar Inc.<\/em>[2]<\/a> But it is largely accepted now that the process of innovation is not random. The creation of new ideas in the modern world often heavily relies on existing ideas and builds on them.<\/p>\n

New technologies arose from the intersection of previously unconnected fields. Technology fusion describes the process whereby entirely new technologies, such as electro-mechanical manufacturing equipment, are spawned by the integration of different fields of art. New fields, such as biotechnology and nanotechnology, stem from the integration of existing disciplines.<\/p>\n

There are an almost unlimited number of potential recombinations which an innovator may pursue. The process of finding and trying new technical inputs is often referred to as search. Search processes are often characterised as local and distant search. Local searches involve component with which the innovator is familiar. Distant search tap into unfamiliar fields.<\/p>\n

An open innovation model need simplifies the distant searches for an innovator. This may help and tap into different solutions for the same problem developed by different entities and make a breakthrough innovation. Such innovations are beyond the abilities of any one firm to envision.<\/p>\n

It is easy to see from the above that open innovation model is beneficial in many ways like maximising profit, avoiding unnecessary competition and, to innovate in the intersection of two different fileds of art.<\/p>\n

Managing the open innovation model vis-\u00e0-vis patent laws<\/strong><\/p>\n

It is well established that traditional patent laws, offering monopoly rights to the innovator, discourage the very idea of open innovation. But the author would like to postulate that if the intellectual property of an innovator firm is managed in an intelligent manner, it would be helpful in developing innovation model, should they choose to do so. By systematically managing the open innovation and patent management processes a firm might optimise the benefits that are to be gained by these two seemingly conflicting systems.<\/p>\n

Some of the world\u2019s largest patent-holders (firms like Philips NV, IBM, and Microsoft) have embraced the open innovation model. As an example transformation of Microsoft\u2019s IP strategy due to the increased demand for interoperability of their Linux and Windows systems has encouraged the move. And if we examine the patenting activities of Microsoft, we observe that it does not appear to have reduced its patenting activities in response to this strategic shift. Microsoft has maintained a constant patenting.[3]<\/a><\/p>\n

Managing the open innovation process<\/strong><\/p>\n

The volatility and the conflict in the open innovation model make it difficult to manage especially in the light of patent laws. The facts that make management difficult are:<\/p>\n