How do you Optimize a Patent Portfolio

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A patent portfolio is a collection of assets including granted patents and applications possessed by a company. Although, the quantity of patents in the patent portfolio is an important parameter for determining how strong the patent portfolio is, but without considering the quality of each patent in the portfolio this determination will generate a huge market revenue loss. 

Therefore, it is important to evaluate each patent of the portfolio to identify gems which would help a company or a person to better understand the portfolio and can be used in determining strategies that could be implemented to remain at a competitive edge and to generate good market value. This process is known as patent portfolio optimization or patent portfolio pruning and this will lead to an optimized patent portfolio with maximum benefits. 

The patent portfolio can be optimized either by using the existing patents in your portfolio or by acquiring patents from your competitors. 

As previously mentioned, to generate an optimized patent portfolio, to use the IP budget efficiently, and to now different strategies to be implemented to the portfolio optimization, the focus should be on reviewing each patent and that may either be performed manually or automatically. This step is an important one that would help in determining core, futuristic and non-core patents. 

  • Core patents are the ones that have high value for the company based on the market requirement and business goal.
  • Non-core patents are the ones that are not relevant to the company’s current business requirement.
  • Futuristic patents are the ones that will be having some future value and give you benefit, that means if you are having patents related to blockchain domain, but currently not working under this business segment, these patents will help you to enter in this business segment in future. 

To get to these different types of patents the best method is to categorize each patent and then rank the patents under each technology category based on the technical scoring and patent assertive characteristics of patents to generate a priority list of the patents under each category. After generating a ranked list of patents, the target can also be identified which can in later be used for litigation purposes for licensing strategies.  

Further, market research for identifying new technologies that are applicable should also be identified. 

What are the strategies related to the patent portfolio? 

Now, when we have a clear list of patents, multiple strategies can be decided upon either to subtract or add the patents to the portfolio. 

  • If the patents in your portfolio are the core patents, maximum revenue from the patents can be generated by either monetizing the patents by licensing, sale or patent litigation.
  • If the applications in your portfolio are the core of the company, diversification can be applied by filing continuation, continuation in parts (CIP), and divisional applications to increase the scope of the claim to be used in infringement and as an offensive or defensive strategy. 
  • If the patents are not core to your company’s current business strategy but have a high ranking, they can be licensed to other organizations to generate additional revenue.  
  • If the patents in your portfolio are non-core and have a low ranking, the better option is to prune, abandon or sell the patents so that the IP budget can be invested somewhere else instead of maintaining the patents and paying maintenance fees. 
  • If the patents in your portfolio have a low ranking in the current jurisdiction, the geographical coverage can be increased to the jurisdictions, where the technology can be beneficial. 
  • If another company holds more high-ranked patents related to your company’s current business requirement or maybe your future business requirement, expanding the portfolio by merger or acquisition related to the IP assets can be the best option. 
  • If your company holds core patents related to any standard IEEE, 3GPP, ETSI, etc, advantages can be taken from the patent pools, where patents are put together by different companies and licensed as a group. This will surely provide a faster rate of return and reduce the administrative cost. Although here the FRAND will limit the return. 
  • Identification of new technologies and obtaining patent protection on them also optimizes the patent portfolio for the company. 

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