Inventing the Future The Importance of Inventive Innovative

Inventing the Future The Importance of Inventive & Innovative Activity in Maintaining Competitiveness BY P. KANDIAH KASS INTERNATIONAL SDN BHD “The IP Experts”

No business remains the same Unless there is innovation there is certain business death Unless there is innovation, a business evaporates “The IP Experts”

Product Innovation Sales 3 rd generation 2 nd generation 1 st product Time “The IP Experts”

Innovations in Trademarks Modernizing Trademarks - e. g. Shell, 3 M, Starbucks “The IP Experts”

New Products (Non-existent before) E. g. Cell phones, Smart phones, i. Pad, etc. Materials Inventing Future Products/Process Reduce Cost Operations Machines/Equipment Market Needs “The IP Experts”

Necessity is mother of invention - Traditional view (still relevant) Market survey on unmet needs “The IP Experts” R&D New Products

New Way Create Needs New Challenges “The IP Experts” Then create market (e. g. Cell phone, etc) Global Warming Increasing cost of labor Modern communication tools etc.

See Challenges e. g. Japan – Small houses/apartments Miniaturization of domestic appliances Multi-functional tools High cost of fuel and reduction in supply Fuel efficient vehicles/equipment/machines Land High Value e. g. Oil palm plantations “The IP Experts” Multiple use of land - Use of biomass - Use of below canopy space - Low sunlight plants - Animal husbandry

Singapore “The IP Experts” - Shortage of land water - Use of roof tops for commercial gardening - Create technology for land water management (Now exporting water management technology)

Old / Existing Needs New ways of satisfying needs using new technology E. g. Use of cell phones, multi-functional tasks (Telephone, camera, watch, alarm, storage of images, transmission/reception of images, directory of information), Use of credit-card, etc. “The IP Experts”

Walkman criteria Realized need for people to listen to music individually and whilst on the move Separated location of production of music and the hearing of music by the individual Now met by several ways: - MP 3 players - i. Pods - Cell phones - etc “The IP Experts” (Aided by digital technology and the miniaturization of devices)

Creation of Technology To extend wide control of market through patent system Toyota Cars Robots to make the cars Gillette Razor Blades Technology to make the blades Carotino Cooking oil Machinery to produce the oil Inventor Efficient Production & Utilization of Energy in oil palm industry “The IP Experts” New/Innovation in equipment to achieve energy efficiency

Product Development Proprietary Rights Patent/Utility Innovation Industrial Designs Copyright/Layout Circuit in ICs Trademark Unless R&D results claimed as IP rights, they are deemed donated to the public “The IP Experts”

Sources of Invention/Innovation From in-house R&D facilities 1. From the marketing and sales departments 2. From QC circles, safety committees, ISO committees, innovation circles, etc 3. From outside of the company a) Free Source i) Patent databases ii) Technology Mining iii) Non-patent literature b) Licensing “The IP Experts”

Anatomy of a Granted Patent Document “The IP Experts”

ICT Industry How is software protected as proprietary rights Software per se Software and hardware “The IP Experts” copyright only patent and copyright

Example of software patent in the US “The IP Experts”

To be patentable, a software must… contribute to ‘technical effect’ Laws on software patents vary from country to country. Ingenious way to protect ICT technology Need to obtain enforceable patents – because of cross-border operation of technology – all integers of a patent claim may not be located in one country. “The IP Experts”

Why Patent? 1. Competitive edge, market power and earning more money 2. Add new revenue stream 3. - licensing a patent 4. - different product - different market - different country “The IP Experts”

Why Patent ? (cont’d) 3. Raise funds and attract potential investors a) patents may be bought, sold or licensed b) collateral for bank loans c) attract investors - venture capitalists - investment bankers - financial analysts - others “The IP Experts”

Why Patent ? (cont’d) 4. Bargaining chip for securing ‘Freedom to Operate’ Patent right is a negative right Cross licensing e. g. Qualcomm Inc. filed 278 patent applications in Malaysia in 2010, yet it does not have a factory in the country. Microsoft Corp filed 44 patent applications in Malaysia in 2010. “The IP Experts”

Why Patent ? (cont’d) 5. Selling the Invention Patents, Industrial Designs, etc. are tradable assets - Value add for business if technology is protected by patents “The IP Experts”

Why Patent ? (cont’d) 6. Strategic Partnership, Mergers and Acquisitions, IPO, and Higher Sales Price Entering new markets with strategic partnerships or in mergers and acquisitions Start up company listed on stock exchange Higher sales price of an established company “The IP Experts”

Why Patent ? (cont’d) 7. Convoyed Sales Add on, collateral, derivative, follow-on or convoyed sales e. g. Improvement in camera lens, but sales of cameras. Improvement in energy utilisation of factory, but sales in critical equipment which results in energy utilisation “The IP Experts”

Why Patent ? (cont’d) 8. Basis for Recognition and Rewarding Employees - Rules for rewarding inventor employees “The IP Experts”

Why Patent ? (cont’d) 9. Part of Branding and Marketing Strategy Company portrayed as a R & D company and not as a me-too copycat company Attract quality employees “The IP Experts”

Patent and UI filings by Malaysians in Malaysia from 2006 to 2010 2006 2007 2008 2009 2010 [Source: Intellectual Property Corporation of Malaysia (My. IPO)] “The IP Experts”

Malaysian Companies and Entrepreneurs need to THINK BIG, THINK GLOBAL MARKET Creativity “The IP Experts” Emotional (Entrepreneurs) Causal (Structured R & D )

THANK YOU for your participation and listening P. KANDIAH Tel: +603 2284 7872 Fax: +603 2284 1125 E-mail: ipr@kass. com. my “The IP Experts”