In Part I of this blog post, we took a closer look at the various types of non-practicing entities (NPEs) that exist today. This range encompasses everything from the minority “patent trolls” that are disproportionately well known in popular culture to the majority of legitimate NPEs that are not as well known to the public.
Since NPEs, generally speaking, seem to be so widely misunderstood, this blog post will examine some of the benefits that “non-troll” NPEs can provide.
To begin with, universities, research institutes, and pure R&D companies, which produce no products, are a type of NPE that can provide a variety of useful benefits. Chief among these are new innovation and new technology.
It’s not surprising that some of the world’s most important innovations have come from this type of NPE, and it should also come as no surprise that these NPEs are a valuable source of patent licenses and investment.
Next, certain types of NPEs, especially professional NPEs, provide a different kind of benefit. As opposed to the research-centered NPEs mentioned above, these NPEs do not have any of their own research capabilities. Instead, they help patent owners to maximize value, in particular sales revenue, royalty revenue, and IP financing.
In fact, many patent owners do not have the network or professional resources necessary to monetize their patents. This is right where this kind of professional NPE steps in, with business knowledge, market experience, and negotiating skills, to help patent owners maximize the cash value they can receive from their patents. Examples of this type of NPE include Fortress and the Marconi Group’s Avanci brand.
At the same time, this type of NPE can also help other NPEs. For example, an NPE like Acacia Research Corporation may help a university, which is another type of NPE, to monetize its patents.
So, this type of professional NPE mentioned above actually benefits both practicing entities (PEs), especially small companies and business owners, as well as NPEs, such as universities and research organizations. In fact, the success that these NPEs have in establishing sales channels for the results of R&D and monetizing patents can inspire and encourage even more research and innovation.
Next, since the chief purpose of an NPE in the marketplace is usually monetizing patents, this can help in prompting patent owners to pay closer attention to patent quality and value. To explain, it is often difficult for a patent owner to see the weaknesses or shortcomings in his or her own patent.
An NPE, however, has the knowledge, experience, and skill to take an unbiased look at the patent from an outside perspective and guide and assist the patent owner in conducting IP business. An NPE, for example, can help an inventor or smaller company to find a marketplace to monetize their IP. In this way, an NPE can assist a patent owner or small business in increasing the quality and value of a patent.
In addition, some NPEs, such as Fortress, can link a patent owner with investment funds, in particular venture capital (VC) and angel investors. This can give patent owners and smaller companies the crucial funding they need to further grow their business or develop related technology.
How Patentcloud Can Benefit NPEs
For example, Patentcloud can help NPEs to check a patent’s legal status, current assignee, and worldwide patent family. And because of a commitment to quality data that includes proprietary post-acquisition processing, Patentcloud excels in providing the most accurate legal status and current assignee for the US and China.
Patentcloud can also enable NPEs to identify the quality and value of a specific patent. This is particularly true of Quality Insights, a Patentcloud exclusive that delivers a deeper look into the details of a patent, particularly in regards to quality, and it will also soon be true of the upcoming Value Insights, which will identify the potential value of a patent. These two products can help NPEs greatly in understanding a target patent’s position not only in an industry but also in the patent market.
In addition, Patentcloud can help NPEs in managing their patent portfolios. In fact, many NPEs do not actively employ a patent management system. However, with Patentcloud’s Project feature, they can easily manage their entire patent portfolio. At the same time, Patentcloud’s exclusive Patent Matrix can also assist NPEs in identifying and understanding how their patent portfolio is located in different technologies and industries. Finally, when it comes to identifying the major inventors in specific industries, Patentcloud delivers this information quickly and accurately.
All in all, for legitimate NPEs, Patentcloud can be of great assistance not only in the buying of patents and the management of patent portfolios but also with the monetization of patents, thanks to Quality Insights and the citation information it provides.
So, the next time you hear about an NPE, remember that most are not the patent trolls that they are usually assumed to be. In fact, NPEs are an important part of the patent ecosystem, and they actually deliver a wide range of benefits, to patent owners and the patent marketplace.
And with advanced products like the AI-powered Patentcloud, these NPEs can quickly assess patent quality and value, enabling them to continue encouraging innovation by assisting patent owners in maximizing the monetization of patents.