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Story URL: http://www.silicon.com/cxoextra/0,3800005416,39166877,00.htm

Europe's execs turn to patents for cash
And prepare for the worst

By Jo Best

Published: Wednesday 25 April 2007

Europe's execs are increasingly attempting to protect their intellectual property (IP), a new report has found.

The white paper from the Economist Intelligence Unit (EIU), sponsored by Qualcomm, itself known as an IP powerhouse in telecoms, has found executives in knowledge companies are turning towards intellectual property more and more to bolster revenues.

According to the research, 53 per cent of companies surveyed said IP rights (IPR) are critical to their business model, up from 35 per cent two years ago.

Telecoms is among the sectors increasingly coming to depend on IPR to earn money - currently earning just five per cent of its cash from IPR. The leader in the field is life sciences, with 18 per cent.

The report said: "Respondents in telecommunications are also more likely than those in other industries to feel their company does not generate adequate value from its IP - nearly two-thirds feel this way in comparison to 43 per cent of respondents in life sciences and healthcare."

In the future, around half of the companies quizzed by the EIU believe better IP management is needed to generate return and a similar figure said it is necessary to protect R&D investments.

A third of companies also cite the need to defend against emerging market competitors becoming more aggressive in their efforts to copy third-party technology.

The report said: "Emerging markets throw fear into the hearts of any firm's manager of its IP portfolio. Patent infringement from emerging market competitors tops the list of threats to IP cited by survey respondents. A large share of respondents also point to unauthorised action by employees as another source of damage to IP."

China is now the most feared in terms of countries where execs believe an IP breach might occur. However, it's worth noting that many of those quizzed had never had to use their patent lawyers in anger: 57 per cent of respondents said they had not experienced a patent dispute.