Explain the: Concept of Patenting and possible motives for the Companies Involved.
By definition, the aspect of patenting describes the possibility of having the interests of the inventors protected through the provision of exclusive rights towards ensuring that their inventions are used by a state (MAYER, 2017). The area of application of patented inventions is broad. However, inventions that are technical are considered to be patented if such inventions are new, and the innovative idea is based on a non-obvious activity, and lastly; is commercially important (Bala, 2017).
Reasons for Patenting
Some of the reasons as to why a company may use patents include:
Inventors get exclusivity through patenting; towards ensuring that their inventions are used. Patenting rewards creativity and promotes originality through the prevention of redundancy and plagiarism. The rights to exclusivity that are given to the inventor last for a 20 year period and depend on its renewal.
Market leaders also find patents useful. Such individuals have their ideas and technologies protected, though for a short time. However, the protection depends on the new technology’s complexity. However, such individuals’ competitive advantages are maintained and thus having costs for competitors created(MAYER, 2017).
Patents are also sources of revenue of which the companies have the potential of creating either direct or indirect profit. The profits are likely to be associated with the consumption of a company's products without associated risks of competitors receiving the patent. Another way of harnessing profit is through having licenses sold for money. Lastly is by having cross-licensing or otherwise, potential advantages get used for controlled diffusion. The overall result, therefore, is growing the customer base with regards to the entire market (class argument).
Through patenting, the image of a brand can be positively cast to the stakeholders. The image of a particular brand illustrates the technological capacity and the level of expertise in a given organization. In such a case, patenting becomes crucial in soliciting partners for businesses, having the company’s brand raised, and also helping the HR through the signaling innovators on the level of expertise against its technological capacity as a way of actively attracting them (class argument).
Enlisted above were general ideas concerning patenting motives. With regards to the case studies provided, the general thoughts are important in identifying the manner in which the patenting concepts are applied. As described; therein:
Points a) and b) describe the issue of exclusivity towards the use of a company's invention; a concept that Hubertz’s has used to ensure profitability. The idea is as a result of the buzzing nature of the Internet computer games. Consumers are thrilled with the array of online games including the Football and World of Warcraft battles within the virtual space. However, with regards to Hubertz’s business niche, he began his inventions by building the virtual soccer manager. What he was cautious about is having a new server paid from his pocket. To maximize profits, he had to take approximately fifty cents for every player transactions which led to a lucrative model within his business. Inventions that followed, and ultimately led to his success include the football ice hockey and the formula one. On the contrary, the mafia simulation game led to the realization of the innovative breakthrough. Concerning the online gaming breakthrough; the Sony scenario is best fit to try the same points, (a) and (b) to ensure that they obtain exclusivity owing to the financial retardation evidence about their originality and creativity. However, the company still faces financial and innovative crack-down crises even though it is regarded as the leading entertainment provider. It has experienced a period of falling off its bastion. After which it has been overtaken by competitor companies like Apple and Samsung in the production of products like iPods, TV sets, video cameras, and mobile phones.
Reasons for Patenting
Bigpoint and Sony may be having similar motives and viewpoints as globally established companies and also market commanders. However, Sony may be lagging behind with regards to the issue of striving to achieve direct and indirect revenues through its innovative approach. The company has lost several millions of Euros, approximating to ninety million. As it realizes such kind of losses, its competitors like the Korean LG Electronics makes profits. From a personal viewpoint, it could be proposed that the huge losses are as a result of Sony's focus on their products to consumer interests. It is therefore sensible to understand why Stringer accuses the company of behaving like the electrical industry supplier. The new TV set technology should, therefore, be patented as a way of ensuring that the lost glory including profit gain is realized. However, Sony has been; for a long period, cocooned into a colorful content provider which is also networked. Patenting would, therefore, ensure that the company can reorganize the required equipment for the purpose of playing and viewing. Alternatively, they could sell to Stringer through a cross-licensing agreement. It would be so since Stringer is from the business sector and would, therefore, be able to construct an alternative technological product build the new technological product with regards to his plan of reconstruction. Since it is through patenting that the image of a brand can be positively cast to the stakeholders; illustrates the technological capacity; and the level of expertise in a given organization, Sony would only require the signaling effect as described as a motive towards the application of a patent. Sony will require a massive number of employees to ensure that the new technology is provided.
The question on open innovation requires us to understand the definition of the same. As promoted by Henry Chesbrough, the term was noted to be meaning; a paradigm of assumptions made on the basis that firms have the capacity to use external and internal ideas and paths of marketing as a way of making technological advances (Open Innovation, 2003). However, with advancement in technology, the term is referred to as the distribution of processes of innovation by purposeful knowledge flows that are managed within the boundaries of an organization. The boundaries in question refer to those between businesses and their environment and the manner in which they get to be permeable allowing innovations to get transferred into and out of business (Open Innovation, 2003).
Open innovation is all about user innovation, however, the aspect of user innovation is not portrayed in Sony, with regards to the provided case. Other aspects that would alternatively describe the subject matter are:
- Know-how trading
- Cumulative innovation
- Mass innovation
- Crowd-sourced innovation
- Distributed innovation.
The piece of knowledge that lacks in Sony’s case is the fact that open innovation has a fundamental principle that determines innovation and production. This core idea that masterminds innovation is that within the current system of production and in this global existence of dispersed knowledge, no given company can rely on their research. However, there is a chance of buying licenses or patents from other established corporations. Another fundamental factor to consider is the issue about internal inventions never getting employed in the businesses of a firm but instead exported from the company. In Sony's case, the new TV set technology should, therefore, be patented as a way of ensuring that the lost glory including profit gain is realized. However, Sony has been; for a long period, cocooned into a colorful content provider which is also networked. Patenting would, therefore, ensure that the company can reorganize the required equipment for the purpose of playing and viewing.
A company like Sony should recognize that having the innovative partnership with other competitor companies ensures that the intended risk is shared and thus the outcome rewarded. Bigpoint, on the contrary, understands that paradigm of open innovation is interpreted to extrapolate beyond external innovation sources like:
- Competitor companies
- Learning institutions
Open innovation has been a source of change in Bigpoint’s intellectual property employment and management since the corporation has tasted the fruits of its research driven and technical generation capability.
It would be evidently claimed that Hubertz’s Bigpoint is an open innovation because he began his inventions by building the virtual soccer manager. What he was cautious about is having a new server paid from his pocket. To maximize profits, he had to take approximately fifty cents for every player transactions which led to a lucrative model within his business. Inventions that followed, and ultimately led to his success include the football ice hockey and the formula one. On the contrary, the mafia simulation game led to the realization of the innovative breakthrough. It is therefore understood that Bigpoint is an explorative venture. The exploration relied on the external and internal innovative opportunities.
Patenting describes the possibility of having the interests of the inventors protected through the provision of exclusive rights towards ensuring that a state uses their inventions. Inventions that are technical are considered to be patented if such inventions are new, and the inventive idea is based on a non-obvious activity (MAYER, 2017). However, open innovation is a paradigm of assumptions made on the basis that firms have the capacity to use external and internal ideas and paths of marketing as a way of making technological advances (Open Innovation, 2003). However, with advancement in technology, the term is referred to as the distribution of processes of innovation by purposeful knowledge flows that are managed within the boundaries of an organization
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