Intellectual Property Rights - Essay Example

Intellectual Property Rights Intellectual property is a concept which has gained popularity in the business world over the past few decades due to the advantages accrued by businesses. In the paper below, various benefits of intellectual property will be provided. An introduction of intellectual property will be provided including background information about how it came to be and why it started becoming popular among the business people. Furthermore, its benefits legally, in regard to business and stakeholders will be discussed in details. Key words: Intellectual property Introduction Intellectual property basically entails the creations of the mind, for instance, inventions; designs; symbols; art; images; logos; and many more that get used in commerce. When one patents his or her given creation, he or she will be making a point to the public that he or she owns that creation and any person who may want to create the same thing and claim to be his or hers, will therefore face the law (Johns, 2010). Patenting a creation provides one with the right to personalize the given creation as a property, hence bearing the word; intellectual property. In the technology industry, patents have remained to be the most relevant area as more and more inventions are created (Johns, 2010). Through time, it intellectual property has turned out to be an interesting subject as many inventors become aware of their rights and freedoms when it comes to patenting original creations of their own. Background As the importance of patents continues to grow over the past years, same to the rate at which new patents are issued each year. The rate is continuously increasing as more inventions come into the world. There have been a lot of concerns which might have been raised in regard to new patent ideas which have ventured into giving patents for abstracts and business methods. An example of business methods patented include: “Reverse Auction” technology that was patented by Priceline.com (Johns, 2010). New patents in business methods have stirred quite a lot of controversies as many people argue that they do not belong in the category of true inventions (Johns, 2010). Today, patents have turned out to become a very competitive asset to possess as a creator so as to be sure of the given future of your business. In addition, they can be used as business tools which can be used to map trends plus convergences, capabilities of partners, new strategies innovation, and help improve the various business units existent in a firm. It has come to light that patent have come to play a crucial role in deciding who would be a loser or winner in the business world (Johns, 2010). Legal Issues Major and smart corporations nowadays have come up with business strategies that entail patent right development strategy. The main reason for dealing with such strategies in business is to avoid patent suits and hence maintain the company’s image and save money. Today, companies which constantly develop new technologies have taken a stand to get patents for their creations so as to have competitive advantage in the given business environment (Johns, 2010). In addition, such companies are able to reap quite a lot of financial gain by winning legal cases pertaining to those who come after them with inventions similar to them. Two or three decades ago, the court system denied more than half the number of patent claims. Today, the court is accepting more than three quarters of the patent claims filed. It has become a huge business for firms to sue those who are going against their patent rights (MCJohn, 2009). As an innovator and a patent holder, in case of a competitor or a new entrant company, creating a technology that is similar to yours in all means, yet goes ahead to use it for the purpose of business, a patent claim in such case would come in handy. Such companies are sued since they pose a threat to the company which had taken the patent right. Take for instance company A which sells its patented products to a population of 100,000 people in region B (Landes, 2009). In case of a new company B turning up with similar invention in region B and starting to sell its products to the 100,000 people at a cheaper cost, definitely, Company B will take more than half of Company’s A market. In order to discourage company B from proceeding with its course of damaging Company’s A market, suing them with a patent claim which they will eventually pay for the damages caused to the company is the strategy of choice in that case. Therefore, businesses are taking parent rights for the sake of protecting their markets that consumer their products and services at all cost from potential competitors who might be having the same technology or creation (Landes, 2009). Business Issues Patents have nowadays become a strategic tool for combating competition in a given field. Furthermore, some companies usually use patents to bargain with other companies when it comes to mergers to buying of smaller companies. Companies that have patent rights tend to be sold at a higher price when compared to companies that do not have patent rights for their products (Johns, 2010). It is common knowledge that patented products fetch a good price in the long run sine it would not be having strong competitors since they would have been shielded by the patenting process. Companies use patent to negotiate with various companies when in need of access to various technologies that have patent rights from their competitors or partners (Landes, 2009). With time, as businesses started to discover the power held by owning patents, such issues are not ignored as businesses emphasize on the need to possess such rights. In a competitive market which one can predict failure in case of intense competition, when one comes up with a unique product, he or she can patent it so that no one in the near future can come to claim that the invention is there’s (Johns, 2010). In addition, owning a patent right in a given technology scares competitors away that might have had intentions of creating a product similar to the patented one for fear of getting sued and making losses. Patents have gained popularity as they have become great assets when fighting business battles. Furthermore, patents have been useful in the expansion of the market share (Landes, 2009). In order for a business to own a given market share and have trust in it, it is important to eliminate competition. The only surety in eliminating competition has turned out to be patent right, hence explaining its popularity in the business field (Johns, 2010). Patents have turned to be a money minting scheme for businesses as they are able to maximize their returns plus increase revenues. Stakeholders Patents have become critical in companies that develop lots of new technologies. When companies patent such technologies that have huge potential of increasing revenue for a given company, it is easier for them to attract stakeholder (Landes, 2009). In case such companies look for stakeholders in their company in order to support the business financially, many firms can strive for that post due to the profitability involved (MCJohn, 2009). For instance, when a new form of technology emerges that has the ability of revolutionizing the world; such a company would need financial backup to ensure that the product reaches to the right market and sold (Landes, 2009). In order for such to be possible, introducing shareholders into the company that bring in their money to help the company grow for the purpose of getting some returns back of the proceedings got from the sale of the given patented product. In addition, competition can only be eliminated in case you have strong stakeholders for the company. For growth to occur, financial backing is important (Landes, 2009). Summary Intellectual property concept has gained popularity over the past few decades due to the benefits derived from them. Businesses which come up with new technologies have adopted the patent right system so as to ensure that their products and services are protected from unscrupulous competition (Landes, 2009). In addition, it businesses have adopted the practice of gaining patent rights for news develop products so as to have competitive advantage over their competitors. Furthermore, firms have found out that they can make more money through suing those who go against their patent rights and get some money. All in all, intellectual property has proven to be advantageous to business. References Johns, A. (2010). Piracy: The Intellectual Property Wars from Gutenberg to Gates. Chicago: University of Chicago Press. Landes, W. (2009). The Economic Structure of Intellectual Property Law. Harvard: Harvard University Press. McJohn, S. M. (2009). Intellectual Property: Examples & Explanations. New York: Aspen Publishers Online. Read More