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In today’s innovation-driven economy, intellectual property (IP) is no longer just a legal asset; it’s a strategic lever for growth, competitive advantage, and financial performance. Companies that treat IP as a dynamic business tool rather than a static legal shield are better positioned to scale, defend their market position, and unlock new revenue streams.
This article explores five critical dimensions of IP strategy: (1) licensing as a growth lever, (2) litigation with purpose, (3) creating blocking patents, (4) creative monetization models, and (5) building a monetization-ready IP function.
1. Licensing as a growth lever
Licensing has evolved from a compliance mechanism into a powerful engine for market expansion and revenue generation. When structured strategically, licensing deals can accelerate entry into new markets, reduce capital expenditure, and create recurring income streams.
Licensing is not always about revenue; it’s about strategic control.
Structuring deals for market expansion
To align IP licensing with growth, companies should:
- Define strategic objectives: Is the goal geographic expansion, product diversification, or brand amplification? The licensing structure should reflect this.
- Choose the right license type:
- Exclusive licenses offer control and premium pricing but limit scalability.
- Non-exclusive licenses enable broader market reach.
- Cross-licensing fosters collaboration and innovation.
- Territorial and field-of-use clauses: These clauses ensure the licensee operates within defined boundaries, preserving the licensor’s ability to monetize IP in other markets or sectors.
Best practices:
- Conduct thorough due diligence on licensees (e.g., is their business growing, are they expanding into new markets and territories, and/or are they a good steward of your brand?).
- Align licensing terms with business goals (e.g., market expansion, royalty streams).
- Monitor compliance and enforce rights proactively.
Ensuring compliance and ownership protection
Licensing deals must include robust compliance mechanisms:
- Audit rights: Allow licensors to verify royalty payments and usage.
- Performance milestones: Tie license continuation to sales targets or development benchmarks.
- IP maintenance obligations: Ensure the licensee contributes to patent/trademark annuities and maintenance fees.
- IP marking obligations: Ensure that the license agreement requires the licensee to mark the licensed product(s) pursuant to 35 U.S.C. § 287 (or equivalent statutes in jurisdictions outside of the US), and ensure licensee compliance with such marking requirements.
- Termination clauses: Provide exit options if the licensee breaches terms or fails to meet expectations.
Questions to consider before you license your IP
- Does your company have the internal resources to identify targets and document their need for a license?
- Can you develop persuasive claim charts that will drive a target to negotiate and execute a license?
- If not, partner with a law firm or IP service provider that can assist with your licensing program.
Licensing is not always about revenue; it’s about strategic control. Companies like ARM Holdings and InterDigital have demonstrated how licensing can drive exponential growth while maintaining ownership integrity.
2. Litigation with purpose
IP enforcement is essential, but litigation should be a calculated move — not a reflex. The goal is to protect value, not just assert rights.
When enforcement adds measurable value
Litigation is justified when:
- Market share is at risk: If infringement threatens core revenue streams or brand equity.
- Deterrence is needed: To signal strength and discourage future violations.
- Licensing leverage is possible: Enforcement can lead to favorable licensing deals or settlements.
However, litigation can be costly and time-consuming. Companies must weigh:
- Legal costs vs. recovery potential: If the legal costs outweigh the potential damages from IP assertion, then litigation may not be viable (or at least not ripe).
- Impact on business relationships: litigation may signal aggressiveness to the broader market place, which could potentially cause friction with existing business relationships.
- Reputational risk: For an established company or brand, IP litigation should be clearly linked to a company’s strategic need or otherwise use of its IP to protect its innovations, rather than simply policing all activity in a given market.
Alternatives to traditional litigation
Forward-thinking companies increasingly explore alternatives:
- ITC actions: The US International Trade Commission offers fast-track exclusion orders for imported infringing goods — ideal for hardware or consumer products.
- Mediation and arbitration: Confidential, cost-effective, and often faster than court proceedings.
- Market-channel specific actions: For example, Amazon offers its Amazon Patent Evaluation Express (APEX) program, which allows a patent owner to request takedown of infringing products with a streamlined and cost-effective procedure.
- Strategic settlements: Can include cross-licensing, joint ventures, or equity stakes—turning conflict into collaboration.
Litigation should be a tool — not a trap. Purposeful enforcement aligns legal action with business outcomes.
3. Creating blocking patents
Blocking patents are less about owning a single “big” claim and more about shaping the competitive map so rivals are compelled to narrow, license, or redesign.
In practice, that means turning market intelligence into a steady cadence of targeted filings that (i) publish as prior art before competitors can secure or broaden their claims, and (ii) leaves a company with pendency to tailor coverage as products evolve.
Why blocking matters. In first-to-file systems — such as the US since the America Invents Act (AIA) — earlier applications (and their 18-month publications) become prior art under novelty and obviousness standards. Well-timed disclosures can: (1) preclude competitors from obtaining patents on the same technology; (2) force narrowing amendments during prosecution, continuation, reissue, or foreign counterpart practice; and (3) box in design-around options, preserving your freedom to operate while channeling others toward licensing.
Operational playbook: monitor → map → move.
- Monitor the right signals. Track competitor applications, continuations, and office actions; standards submissions and meeting minutes; regulatory filings (FDA/FCC), SDK/API release notes, open-source commits, product teardowns, and even job postings. Convert this into an evolving heat map of features, data flows, and architectures competitors are building — and where your portfolio is thin.
- Map white space into filings. Draft specifications that teach multiple interchangeable embodiments and implementation layers (device, method, system, computer-readable medium; cloud/edge; training/inference; data formats and post-processing). The goal is optionality: rich enablement and written description that support later claim sets aligned to how the market actually ships.
- Move early — and keep pendency alive. Use provisionals to bank priority when intelligence suggests a rival is approaching launch, then file non-provisionals on a cadence. In fast cycles, pursue accelerated examination on linchpin families and file a PCT to preserve foreign paths. Maintain an “always-pending” continuation so you can prosecute claim sets tailored to emergent competitor features without adding new matter.
Procedural tools that tighten the net.
- Pre-issuance submissions and EPO observations. Feed killer prior art — including your own earlier publications — into a competitor’s file during prosecution to constrain scope before issuance. This is a low-cost way to steer outcomes and deter later broadening.
- Post-grant levers. If an overbroad patent slips through, be ready with targeted Ex Parte Rexams/PGRs/IPRs/oppositions that cite your published disclosures and technical literature uncovered during monitoring. Even the threat of institution can reset negotiations on scope and licensing terms.
- Standard-setting awareness. Where features are drifting toward standard-essential status, file early and consider claim strategies that capture mandatory portions of the spec. Pair with disclosure policies to manage FRAND risk while preserving leverage.
Drafting principles that build a “picket fence.”
- Claim the pipeline, not just the endpoint. Cover sensing/ingest, preprocessing, model training, inference, control loops, and outputs/UX hooks. Include claims that read on how data is labeled, formatted, transmitted, stored, and monetized.
- Teach detectability. Describe artifacts that can be verified in shipped products (protocol fields, timing patterns, model behaviors, telemetry flags), enabling future claim charts and field enforcement.
- Anticipate design-arounds. Offer variant claim language (e.g., “A or B,” threshold ranges, modular components) and alternative algorithmic or hardware paths so competitors cannot simply hop to the adjacent tile.
Make it an operating function. Fold this into quarterly reviews: refresh the heat map; identify gaps; decide which families get continuations, which get accelerated prosecution, and which should publish to block. Track KPIs such as coverage of “must-have” features, pendency health, claim breadth vs. detectability, and standard-essential exposure. Maintain living claim charts for top targets to quickly align continuations with real-world releases.
Done well, blocking patents do more than defend — they choreograph the market, nudging competitors toward narrower claims or licenses while positioning your portfolio as the rails the industry runs on.
4. Creative monetization models
IP monetization is no longer limited to licensing and litigation. Innovative companies are unlocking value through financial engineering, partnerships, and structural transformation.
IP-backed financing
Intellectual property can serve as collateral for loans or asset-backed securities:
- Patent-backed loans: Lenders assess the value of patents and offer capital based on projected royalty streams.
- Royalty securitization: Future royalties are bundled into financial instruments and sold to investors.
- Trademark collateralization: Especially common in consumer brands, where trademarks drive sales.
These models require rigorous valuation and legal clarity but can unlock non-dilutive capital.
Joint ventures and spin-offs
IP can be the foundation for new ventures:
- Joint ventures: Two companies pool IP to create a new entity — common in biotech and semiconductors. Care needs to be taken to identify background IP and joint IP to avoid questions of ownership down the line.
- Spin-offs: A company creates a separate entity to commercialize underutilized IP, attracting specialized investors and management. Such spinoffs can have IP from a particular operating unit or IP that is non-core or nearing expiration. Such IP can be enforced before expiration to maximize value, and capture damages up to six years prior to suit if the patent owner complied with any applicable patent marking guidelines (note, method claims in patents have no marking requirement).
These structures allow companies to focus, scale, and monetize without diluting core operations.
Securitization and IP funds
Some institutions can create IP portfolios and securitize them:
- IP funds: Investors pool capital to acquire and license IP, generating returns from royalties and litigation wins. Such funds must first buy IP and then identify infringing targets. Next, they have to secure licenses or resort to litigation to realize the value of the patent portfolio.
- Securitized portfolios: Bundled IP assets are rated and sold like bonds — providing liquidity and diversification.
Creative monetization turns intangible assets into financial powerhouses.
5. Building a monetization-ready IP function
To act quickly on opportunities, companies must embed IP into their core operations.
Cross-functional collaboration
A monetization-ready IP function requires alignment across:
- R&D: To identify patentable innovations early and align development with strategic goals. IP attorneys can brainstorm with key engineers and scientists to extract patentable inventions.
- Finance: To model IP value, assess monetization options, and manage risk. The IP department (or Outside Counsel) can help identify the patents that will drive monetization, and identify the relevant markets and potential targets.
- Corporate strategy: To integrate IP into M&A, partnerships, and market entry plans. The IP department (or Outside Counsel) can assess the IP of companies being considered for acquisition, identify IP of interest in specific markets, and propose IP to divest for monetization.
This collaboration ensures IP decisions are business-driven, and not reactive.
Key capabilities
- IP portfolio management: Prioritize assets based on market relevance and monetization potential. Identify the best candidates for monetization by a systematic process of review that includes technical classifications, evaluation (detectability, claim coverage, internal impact and offensive impact), and identification of the applicable market and time to expiration, to name a few. Companies can work with outside counsel to develop robust patent portfolios, including sections in the detailed description that are forward-looking, and which can be used to file continuing patents to target competitor activity over the life of the patent portfolio, and, therefore drive protection and value as described above.
- Valuation expertise: Use financial models to assess licensing potential, litigation value, and collateral strength. Such models may include using the above criteria to determine the Total Addressable Market (TAM), number of targets and contribution percentage of the IP to the target products or services.
- Deal structuring: Build internal capabilities to negotiate licenses, joint ventures, and settlements. Otherwise, partner with firms to assist with these tasks, while maintaining the business strategy and objectives.
- Market intelligence: Track competitor IP moves, emerging technologies, and regulatory changes. Understanding the market and your competitors is the first step to knowing the value of your IP and how it can be deployed. Keep informed by leveraging Corporate Development intel or using tools to collect this data.
Companies like Qualcomm and IBM have built IP functions that operate like business units — driving revenue, shaping strategy, and enabling agility.
Conclusion
Intellectual property is no longer just a legal asset — it’s a business imperative. By leveraging licensing for growth, enforcing rights with purpose, exploring creative monetization models, and building a cross-functional IP function, companies can transform their intangible assets into tangible results.
The future belongs to those who treat IP not as a cost center, but as a catalyst.
Disclaimer: The information in any resource in this website should not be construed as legal advice or as a legal opinion on specific facts, and should not be considered representing the views of its authors, its sponsors, and/or ACC. These resources are not intended as a definitive statement on the subject addressed. Rather, they are intended to serve as a tool providing practical guidance and references for the busy in-house practitioner and other readers.
