european science open forum: public participation in risk management eskil ullberg, iku

© Copyright 2004, IKU. All rights reserved.

IKUEuropean Science Open Forum: Public Participation in Risk Management > Perspectives on patenting

RISK MANAGEMENT PERSPECTIVES ON IPR / PATENTING

– Up-framing to include the ”dynamics” of economy

European Science Open Forum: Public Participation in Risk Management

Eskil Ullberg, IKU- Advising on Risk Management and Patenting



One agenda – three issues

• IP aspects – What’s the patenting system?– Issue: economy – Patenting key to economic growth

• Up-framing – better understand the ”dynamics” of economic and other issue – Here focus on the USE of technology and how to manage the RISKS and COST

• Projects with potential public participation driven by technology and patenting– 3 patent oriented cases– 1 current technology/economic/health oriented (3G)



Issue 1: What’s the patenting system?

• Societies and companies are interested in turning ideas in to commercially viable businesses –> management of risk

• Economies needs commodities to function efficiently -> value of right upheld

• In the knowledge based economy, new ideas, innovations are the intellectual capital

• The patenting system turns [technical] knowledge into a tradable commodity



Why such interest in the patenting system?

Services 80%Products 5-20%

”knowledge”– the intellectual property dominates

”hardware” – the physical property dominates

20001900

33%

GDP (accum)Agri 2-3%

Risk related to: ”crop” – the land property dominates (DeSoto)

100%

Source: German Economy, Geneva Association



The Power of the Patenting System

The maker of BlackBerry e-mail devices joins Microsoft and eBay in appealing orders to pay damages for infringing on patents to small firms. (Research In Motion)

”Level playing field” for large and small

A small guy with a big idea ideally beats a big guy with a small idea. The property right holds infront of a court.



Patenting

• Not just a legal issue – ”valid / not valid”• Affects business decisions to invest in product and

service developments – major risk management tool– Funds new technology (from profits of products)

• Economic importance to companies and whole nations – so important (or disputed) that it is part of the WTO agenda (TRIPS)

• The economy and technology is a complex context today and needs ”up-framing”



Issue 2: Up-framing• Make the map as big as possible, but not bigger

– Capture the systemic effects of your issue, in this case technology

• The economic up-framing– The economic, or market dimension must be in there. – Technology ”begins and end” with money

• Technology up-framing– Not only some application but ALL applications of a technology when

looking at a phenomena– Example: ”3G” is between 2G and 4G, its wireless, its wireless internet, its

global, its man/machine interface, its the biggest economic infrastructure since the steamships (global trade), railroads (goods), electricity (SMEs). Now services (and money) are rendered over the Internet.

• Administrative up-framing– Its ”non-obvious” who is managing what when a new technology comes

forth, especially if global use. Old institutions die/changed and are replaced by new.



A multiple-way, ”systemic”, look at technology

Technology development (benefits)

Technology Ownership = Economic aspects

(financing through the patenting system)

Technology usage (risks)

OtherOther



Wireless – Not only about calling

Communication between

all objects (100Mps)



Risks - Manage them and get the benefits

• Wireless technology application risks• Economic risks – efficiency but vulnerability• Security risks – your life, government secrets,

etc. on the Internet• Health risks – hearing, stress, other



Up-framing and dealing with uncertainty

• Risk and uncertainty – a systemic issue– An economic perspective– A technology perspective– A administrative or ”management” perspective

• What’s uncertain?– Everything you can’t put a number on and believe it

• Mitigate or manage– What mechanisms to ”absorb” risk

• The state => puts more on private shoulders



Issue 3: Applications

• Biotech• Software• Financial Services• Telecom (current case)



Case idea: Biotech and Patenting – Commercialization issue

• Big discussion – property rights on AIDS medicines, etc• Biodiversity

– Developing countries have most biodiversity*– The patenting system provides a tool to participate in the

knowledge economy– The your assets into tradable commodities

• KI case: – ”Turn researched knowledge into usefulness for all mankind”– This is done mainly through the commercialization process where

patents play a critical role to manage the investors risks

• US dominates this field of science– Could it be through the commercialization potential (the idea put

into good use) that there is a science leadership?

*TWAS , Third World Academy of Sciences



Case idea: Software – Industry issue

• Big discussion – property rights on software– ”Open Source” movement = NO!– Computers, and software, part of every product/service

today: Engineering, Design and Software.– Ex: Cars, washing machines, micros, etc– Patents needed to manage the business risk

• All represent IP to be commercially possible– Patents, design protection

• US Dominates research



Case idea: Financial Risk Management

• Financial risk management and property rights on risk management techniques

• ”Business method” and software related• Insurance industry: ”12 years behind in Europe if no

patenting possible”* • Pension funds – best management of risk ”excluded”

– 75% (?) of invested capital is pension capital• US Dominates here

* SwissRe on current debate in Europe



Case Telecom: 3G roll-out in Sweden• 3G roll-out has: time-to-market problems, economic problems, health

issues are raised, multiple institutions involved, people are shuffled from agency to agency => Systemic problem?

• Important to be in the technology lead for Swedish industry• Technology has been ”the way out of poverty” for Sweden - Sweden

among founding countries of the Paris convention 1898• This needs application of technology in close collaboration with research.

Essence of success in mobile technology (Ericsson – Telia – Research)• Now – health issues, regulatory demands come up to meet promised

deadlines together with commercial issues (100b internet users on the horizon, 2 out of 3 users machines 2010 )

• Unsuccessful management of these risks and benefits will take the intellectual capital – and companies – out of the country

• ”Framing” of the ”3G” issue in a historical, economic, administrative perspective and health issues



Summary – the economic point of view

• Understanding ”the whole picture” essential to manage risks and benefits – up-frame to include the consumer (the public)

• Much technology will not be developed without patents• Commercialization of your ideas as important if not more

important to society than the research it self - here patents often play a critical role

• Several project ideas where public participation can/will be used are suggested in this session on public participation in Risk Management

• More inputs are welcome!



Thank you for your time!

[email protected]

www.iku.se



Ref.

• WIPO papers on SPLA, www.wipo.org• US FTC report on ameliorations of the patent

system– The patent system and competition, Josh Learner

• Risk Management – from portfolio strategy to value creating systems strategy, Geneva Papers, July 2002

• Financial Risk and the patenting system, PROGRES, June 2004

european science open forum: public participation in risk management eskil ullberg, iku

Documents