Australian researchers wasting IP, warns patent expert

Australian researchers were wasting 90 per cent of their intellectual property value because they did not understand how to use it, a patent attorney has warned.

Freehills Carter Smith Beadle partner Paul Jones said a proprietorial attitude towards IP was also holding back the progress of technological advances.

"I think that researchers recognise that IP is extremely important and that it is a must for protecting their innovations, but they don't know what it does," Jones said.

"They think it is some sort of legal instrument that gives them a monopoly and protects them from having their inventions stolen.

"The last thing they think of is that a patent is a valuable asset."

Jones said that while many researchers acknowledged the value of other intangibles such as qualifications and skills, the use of IP as an income generator was lost on them.

The experience of multinational companies that did use their IP had shown the assets should be generating five per cent of a company's income and 25 per cent of its profits, he said.

At IBM alone the patent portfolio rakes in a sweet $US1 billion annually.

"Licensing IP is frankly money for jam. It is unencumbered money," Jones said.

"But this is a realisation that requires something of a sea change, because it may be you are licensing to a competitor and people are very proprietorial when it comes to this."

Describing the local scene as being plagued by a "diamonds in the attic" attitude, Jones urged researchers to treat IP portfolios as a piece of machinery that must be kept in production.

"If you come up with a new chemical compound in some biotech assay you have the ability to exploit your patent because you have a monopoly over it," he said.

"But there will only be about 10 per cent of that asset that really matters to your current business model, so why not give someone else the other 90 per cent and let them make money for you?

"You are not getting the benefit of the assets if you have created something that is valuable but not valuable to you."

He said that in the current setting, where competitive groups kept their IP cards close to their chests, research progressed relatively slowly. But it did not have to be the case.

"They all have something to contribute and in a climate of collaboration and cross-licensing you would probably find the innovation process quicker and certainly less litigious."

Jones also predicted that once groups began to see IP as an asset, their returns would be increased by a factor of at least three.

"My general view is that, particularly in Australia where our ability to apply technology is limited, we must be getting back a terribly small percentage of the value of our innovation.

"I think we really are missing out both from the point of view of accelerating technological advances and also simply getting bang for your buck."