IP Balancing Costs and Benefits

 

This transcript is for the video IP Balancing Costs and Benefits.

[Music plays and Australian Government IP Australia logo appears on screen with text:  Australian Government IP Australia]

[Text appears on screen:  IP is your business.  Various logos appear below with text:  P; TM; D; PBR]

[Image changes to show a man and a woman standing together and a computerised image of scales appears above them.  Text appears on the scales:  Cost; Benefits]

Male:  When you consider applying for a patent, trademark or design registration it’s important to weigh up the cost and benefits of protecting your IP.

Female:  This video shows you how.  Plus you’ll also learn a simple technique for knowing how much your IP is worth.

[The sound of a cash register is heard, and dollar signs appear on screen]

Male:  Like many business decisions, balancing the cost of IP and the benefits of IP protection can be tricky.  Some things are known, and other things require an educated guess.

Female:  Let’s start with the benefits.

[Image changes to show the woman.  An icon of a padlock appears to the left of the screen, followed by a question mark]

How much is a monopoly on your invention, design or trademark worth to you?  Can you commercialise your innovation?

[The sound of a cash register is heard, and dollar signs appear on screen]

If so, how will it improve your sales and licensing opportunities?  What’s the strategic value of your IP in terms of where your business is going?  These aren’t easy questions.

[Text appears on screen:  TM]

On the other hand, if you choose not to register your IP what’s the risk of infringement, and how would that impact your business?

[Image changes back to the woman]

For example many small business owners only register their business name, and don’t apply for a trademark.  They run the risk of accidentally infringing someone else’s trademark.  If that happened to you could you afford to change your brand, lose your advertising, take down your website, or even throw out your stationery?

[Image changes to show the woman placing documents into a rubbish bin]

Similarly when it comes to inventions and designs IP protection gives you the benefit of certainty, knowing you own your innovation.

[The sound of a bell can be heard and the image changes to show the woman holding out a light bulb which then lights up]

How important are those inventions or designs to the competitive advantage of your business?  Again these are tricky questions.  Ultimately the benefits of IP protection depend on your business strategy.

[Image changes back to the man]

Male:  So we’ve looked at the benefits.  What about the costs?  Generally there are three types of costs – fees you pay to IP Australia, the optional costs of getting professional help, like from a patent or trademark attorney, and the other cost to enforce your IP.

[Text appears to the right of the screen:  1. IP Australia; 2. Professional help; 3. Enforcement]

When it comes to patenting an invention IP Australia’s fees are comparable to buying a cheap second hand car.

[A computerised image of a car appears to the right of the screen.  The sound of an engine starting can be heard]

And less for registering a trademark or design.

[A computerised image of a bicycle appears to the right of the screen]

As little as a few hundred dollars.

[The sound of chimes can be heard and the image changes to show the man holding a mobile device]

Once your IP is registered, there are also renewal fees to keep it registered.

[Image changes to show a screenshot of the IP Australia webpage]

[Image changes back to the man]

IP Australia’s website has the most up to date figures, but on average, depending on whether it’s a trademark, design or patent, they range from about $30 to over a thousand dollars a year.  If you need professional help attorney fees start at a few thousand dollars for lodging a patent, and that’s just in one country.  It could cost a lot more depending on the complexity of your situation.

[Image changes back to the woman]

Female:  Of course registering and renewing your IP is relatively cheap compared with enforcement.  Legal action is rare, expensive, and usually a last resort.  But it’s not the only way to enforce your IP.

[The sound of chimes can be heard and a computerised image of people talking appears to the left of the screen]

Registered IP gets you a seat at the negotiating table, where you may have a range of options from alternative dispute resolution to playing your competitors off against each other.  In those situations it helps to know what your IP is worth.  But how do you put a dollar value on it?  There are many different ways.  

[The sound of chimes can be heard and a computerised image of a sign appears to the left of the screen with text:  For Sale]

Perhaps the simplest is to compare how you would go selling your business with or without IP protection.

[A computerised image of a sign appears to the right of the screen with text:  Without IP]

How would a potential buyer feel if there was no clear title of ownership for your trademark, invention or design?

[A computerised image of an envelope appears to the left of the screen with text:  3 X Profit + 10% + 20%]

Let’s say you expect to sell your business for three times your annual profit, but if IP protection gets you an extra ten or 20% on sale, how much is that?  Keep in mind this figure is often higher than what’s on your books.  If you’re unsure, do your homework; speak to an accountant or business advisor familiar with your industry.

[The sound of a bell can be heard as text appears on screen:  P; TM; D; PBR]

[Image changes back to the man]

Male:  Our IP system is designed to encourage innovation, but it can’t completely remove all business risks.  Yet much of the goodwill in your business is intellectual property which can be protected.

[Image changes to show the woman walking onto screen and standing beside the man]

Female:  Of course this is just general information.  To make an informed decision you may need professional advice about your specific circumstances.

[Text appears on screen:  IP is your business.  Various logos appear below with text:  P; TM; D; PBR.  www.ipaustralia.gov.au]

Male:  Visit ipaustralia.gov.au for more information.

[Australian Government IP Australia logo appears on screen with text:  Australian Government IP Australia]

Last updated: 
Wednesday, April 6, 2016