By: Nahdatul Aishah Mohd Sharif
Commercialising intellectual property (IP) including patents and copyrights, can be exciting to turn innovative ideas into profits while making a real-life impact. However, the specific path to take may depend on the nature of the IP, and the goals of the creators and inventors. Some inventors create their IP and may have their own drive to push the product into the market. In another scenario, where the inventor has no capacity to push it to the market, technology transfer can essentially be a powerful tool to turn the IPs into real world applications by a secondary party. This is by allowing another person or organisation to use the IP in exchange for a fee or royalty.
In essence, commercialisation and technology transfer are two stages of a continuous process to ensure the IP goes to the targeted user. Protecting an IP is the first step to be taken by the technology provider to ensure that they are compensated for the transfer. Then comes technology transfer which bridges the gap between invention and its application. Finally, commercialisation takes place once the technology is fully transferred, allowing the IP to transform into real products and services. Understanding these flows is crucial for anyone seeking to maximise the impact of their IP and successfully commercialising it.
An example of a technology transfer is when a startup company develops and patent a software algorithm. Then, through a joint venture with a large tech company, the technology is transferred and integrated into their existing platform, reaching a wide user base and generating revenue for both parties. Copyrighted works and art can also benefit from this approach. Some unique ways to commercialise art and copyright-protected work through technology transfer includes partnering with artificial intelligence (AI)-based companies to develop tools that use creators’ artistic style or creative assets to generate new works, customised products, or interactive experiences. Therefore, royalties can be earned on each use of the creator’s IP through the AI platform.
Although securing a technology transfer deal can be complex, some key elements are to be considered such as early planning and dedicated resources. To highlight, both parties – the technology provider and the technology recipient – must have a clear understanding of the technical details of the technology and the intellectual property involved, the scope of the transfer, the potential applications and risks, rights and obligations of each party, and to be fully aligned on the revenues of the transfer.
Second, both parties must exercise effective communication, be negotiable and transparent throughout the pre, during and post-transfer period. Both parties may also work on signing a non-disclosure agreement before sharing information, before proceeding to a deeper and mutually beneficial technology transfer agreement. This step is ideal to benefit the technology provider before sharing the details of their IP and would also help in building trust with potential partners.
A well-drafted technology transfer agreement is crucial to protect the interests of both parties, bearing in mind that technology transfer is often a long-term process. Also, simply transferring the technology is not enough. The provider must be willing to provide sufficient post-transfer support and knowledge to ensure the recipient acquires the adequate skills and technical infrastructure to apply the transferred IP or technology effectively. By actively pursuing both technology transfer and commercialisation strategies, one can surely increase the chances of turning innovative ideas into real world successes.
The author is an Intellectual Property Associate based at Taylor’s University’s Research & Enterprise: Knowledge Transfer & Commercialisation.
