Proprietary Technology

Patents are generally the most effective way of protecting technological innovations, but know-how (and trade secrets) also provide an effective mechanism for protecting certain aspects of technology. The most effective strategy for protecting any particular technology should be evaluated on a case-by-case basis.

In general terms, the patent system is a trade off between disclosure and exclusivity, where you disclose your invention to the public in exchange for a monopoly that is commensurate with the contribution you have made to the general knowledge pool. The scope of your monopoly is defined in a very specific way in the patent specification and this scope is negotiated with the Patent Office in each territory, which is why patents tend to be the most expensive intellectual property right to secure. Know-how is generally protected through confidentiality, often through contractual obligations, so upfront costs tend to be low. However, keeping this know-how a secret and enforcing these rights is complex and expensive.

The value of a technological innovation is dependent upon the commercial impact it has (or has the potential to have) on the business. Patents and know-how are, in essence, commercial tools that permit a company to leverage research and development efforts to improve their commercial position. The creation of value in these rights requires the innovations that they protect to be exploited in some way.

Successful exploitation of new ideas requires an increase in customer value or the creation of wealth. Valuable innovation is outcome-oriented and is aligned with the company’s overall strategy in order to maximise its effectiveness at achieving these goals.

Whether the innovation is incremental, substantial or radical, it has the potential to add value. The value of technology cannot be measured accurately by considering each intellectual property right independently. The true value of a company's proprietary technology can only be assessed properly by considering the commercial impact of the entire bundle of rights associated with such technology.