As our Prime Minister looks to lift Australia into a new era of innovation, companies and individuals risk losing millions. Chartered Accountants Australia and New Zealand has released Maximising the potential of Intellectual Property for your business as part of their business briefing series.
Leader of Thought Leadership and Policy Karen McWilliams said that in order to ensure that businesses maximise the benefits of their innovative conceptions, ideas and designs, it is vital to understand the best way to protect and manage intellectual property (IP) assets.
McWilliams said: “Effective management of IP can benefit businesses by assisting them to grow through commercialisation opportunities and to develop a strong brand and business reputation, but ultimately, you will be able to minimise the risk of copycats, which can ultimately erode market share. While most business leaders are acutely aware of the importance of thinking creatively and innovatively today, many are less familiar with the need to protect intellectual property.”
Intellectual property lessons from around the globe:
Volkswagen’s takeover of Rolls-Royce
In 1998 Volkswagen purchased Rolls-Royce and Bentley. The purchase included the Bentley name but – as Volkswagen found to its detriment – it did not include the license to use the Rolls-Royce trade mark on cars. This trade mark is controlled by Rolls-Royce Plc. BMW subsequently acquired the rights to use the Rolls Royce trade mark after a four-year legal battle.
LESSON – In any Merger and Acquisition, ensure you have a clear understanding of all IP included and excluded from the deal.
Kodak invented the technology behind the digital camera in 1975. This was a feat in itself given this was before personal computers were around. Kodak patented the first digital camera in 1978 but Kodak had a good existing business model based around film and no one at the organisation saw any reason to disrupt it. Every digital camera sold meant a film camera and its associated film sales were forgone.
The patent did earn billions for Kodak until its expiry in 2007. However, Kodak embraced digital photography too late and was left behind by its competition. In 2012, they filed for bankruptcy.
LESSON – Ensure you take advantage of your intellectual property, registration is not enough on its own.
Electrical manufacturer Kambrook potentially lost millions of dollars because it failed to protect its electrical power board invention. When it was released in 1972, the product was hugely successful and was the basis for Kambrook’s growth into a major producer of electrical appliances. As the product was never patented, Kambrook ended up sharing the market with many other manufacturers and losing its opportunity for millions in royalties.Today Kambrook has a number of registered rights for a range of consumer goods demonstrating their awareness of the importance of IP.
LESSON – Ensure you register all new inventions.
Thomas Edison is famous for inventing the light bulb. However, Sir Humphry Davy first created incandescent light in 1802 and there were about 21 other inventors during the 19th century. Sir Humphry refused to patent his invention. Thomas Edison was one of the first to turn his invention into a long lasting bulb that was commercially viable. He patented his light bulb in the US 1880 and later formed a joint company with Joseph Swan, who held the patent in England.
LESSON – If you don’t patent your invention, someone else will.
Burger King’s expansion into Australia
When American fast-food chain Burger King moved to expand its operations to Australia in 1971, it found that another company there had already registered “Burger King” as a trade mark. They were forced to rebrand their restaurants as “Hungry Jack’s” for the Australian market. Australia turned out to be their second-largest market outside the US – and yet the “Burger King” name is far less recognised here.
LESSON – Build a your IP strategy in advance and register relevant IP rights in all necessary jurisdictions.
IP is one of the most valuable assets a business can own. To help you understand and make the most of your IP, Chartered Accountants Australia and New Zealand have partnered with IP Australia and the Intellectual Property Office of New Zealand (IPONZ) to provide the tools and guidance needed – Business briefing: Maximising the potential of Intellectual Property for your business.