Presentación de Henry Chesbrough

7/27/2019 Presentacin de Henry Chesbrough

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2006 Henry Chesbrough 1

Open Innovation and Open BusinessModels:

A new approach to industrial innovation

Presentation to Joint OECD/

Dutch Ministry of Economic Affairs

Conference on Globalization and Open Innovation

Dec. 6, 2006

Henry Chesbrough

Haas School of BusinessUC Berkeley


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Agenda

Open Innovation Open Business Models

Implications for Managing IP Policy Implications


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The Current Paradigm: A Closed

Innovation System

ResearchResearch

InvestigationsInvestigationsDevelopmentDevelopment New ProductsNew Products

/Services/Services

The

Market

Science

&

Technology

Base

R D


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Current

Market

Internal

Technology

Base

R D

The Open Innovation Paradigm

Technology Insourcing

NewMarket

Technology Spin-offs

External

TechnologyBase

Other Firms

MarketLicensing


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5 C 2002 Henry Chesbrough EIRMA SIG III, 2005-10-20

Robert Kirscbaum, DSM: Research & Technology management, July August 2005

License in

Spin in

Acquire

DivestSpin out

License out

The creation of new businesses is a highly dynamic process,best represented as a horizontal funnel(passed in iterativesteps)

Open innovation in practise


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6 C 2002 Henry Chesbrough EIRMA SIG III, 2005-10-20

Closed innovation

Our current

market

Our new

market

Other firms

market

Open innovation

External technology

insourcing

Internal

technology base

External technology base

Stolen with pride from Prof Henry Chesbrough UC Berkeley, Open Innovation: Renewing Growth fromIndustrial R&D, 10th Annual Innovation Convergence, Minneapolis Sept 27, 2004

Internal/external

venture handling

Licence, spinout, divest


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Current

Market

Internal

Technology

Base

R D

IBM & Open Innovation

Technology Insourcing

NewMarket

External

TechnologyBase

Other Firms

Market

Java,

Linux

Sun, and others eqmt

$1.9 B licensing,

OEM for semi cosODM for others

Global Svcs


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Current

Market

R D

Is this just for High Tech?

Procter &Gamble

NewMarket

Use it or Lose it

External

TechnologyBase

Other Firms

Market

Technology

Scouts

InternalTechnology

Base

VentureAcquisitions

Spinbrush

LargeAcquisitions

Gillette


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The Logic of Open Innovation Good ideas are widely distributed today. No

one has a monopoly on useful knowledgeanymore.

Innovation is now done within networks offirms, rather than within a single firm

Not all of the smart people in the world work for

us.


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Agenda

Open Innovation9Open Business Models

Implications for Managing IP Policy Implications


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Which Would You Rather Have?

A Better Technology

Or,

A Better Business Model


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Go with the Business Model

Business Model > Technology Ability to profit from technology

Ability to scale technology

Ability to continue innovating technology

Ability to acquire technology


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IBM: Its Closed Value Chain

V

alue-Added

Activities

Materials

Chips, devices

Computers

Operating Systems

Applications

Productivity SW

Atoms

Solutions

Value Chain

All IBM pre 1993


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IBMs Open Business Model

Value-AddedA

ctivities

Materials

Chips, devices

Computers

Operating Systems

Applications

Productivity SW

IBM Chain OEM Market

Materials

Chips, devices

Computers

Operating Systems

Applications

Productivity SW

Integration

Atoms

Solutions Other Integrators


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IBMs Open Source Business Model

Spends about $100M each year on Linux 50% for general improvement

50% for specific improvements for IBM gear

Others spend another $800M a year IBM creates value through Linux

Also donates development tools, patents

IBM captures value through value-addedservices and software up the stack


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Agenda


9Implications for Managing IP

Policy Implications


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The Role of IP in the BusinessModel

A business model has two functions:1. Value creation2. Value capture

IP is critical forvalue capture

in many businessmodels

IP can also be valuable in creating value Setting standards

Intellectual commons

Defining the space for the innovations of others


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Fig. 4.1

Evaluating Technology Alignment with Patent Coverage

Patent Coverage

Technology Coverage

UnusedProtection

Region

ProtectedRegion

Unprotected UseRegion

Party 1


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Fig. 4.2

Complex Technology Alignment with Patent Coverage,when Two Parties Have Conflicting Claims

Patent Coverage

Technology Coverage

Party 1

Patent Coverage

Technology Coverage

Party 2AssertionRegion

ImpairedRegion

InfringementRegion


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Fig. 4.3

Complex Technology Alignment with Patent Coverage,when Second Party does not Practice Technology

Patent Coverage

Technology Coverage

Party 1

Patent Coverage

Party 2Now IrrelevantAssertionRegion New Infringement

Region

InfringementRegion


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Fig. 4.5IP Mapping Value Chain Analysis: Printers

Controllers

Print Heads

Lasers

Sensors

Repair and

ServiceEquipment Installation Consumables Operation

Enabling

Technology

Manufacturing

Integration

Site Prep

Assembly

Ink

Paper

Testing

Connectivity

Programming

Monitoring

QualityControl

Scheduling

Diagnostics

Testing

Procedures

Parts

= Moderate IP risk

= Strong IP position (possible assertion opportunity)

= High IP risk

= Low IP risk


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The IP Management Life Cycle

Stages in the

Technology Life Cycle

Emerging

Growth

Maturity

Decline

Time

Performance

Figure 4.6

Become the

standard

Compete within

the standard

Grow the

standard

Harvest

the standard


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Managing IP for MS WindowsMature market in US

Windows has won the war to be the standard

So strongly enforce copyright to prevent piracy

Every illegal copy of Windows is money lost

Growing market in China Windows and Linux still battling

So do NOT enforce copyright (not yet)

Every illegal copy of Windows is one less for Linux

IP Management Must be Driven by the Business Model


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The IP Management Life Cycle

Stages in the

Technology Life Cycle

Emerging

Growth

Maturity

Decline

Time

Performance

Figure 4.6

China

US

Become the

standard

Compete within

the standard

Grow the

standard

Harvest

the standard


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C 2002 Henry Chesbrough 25

Example of recorded reassignment:

Intellectual Ventures LLC, atechnology development and licensingstart-up formed by Microsoft veteransNathan Myhrvold and Edward J ung,has won the bidding for GeneralMagic Inc's portfolio of patents and

other intellectual property, paying$300,000.(Wall Street J ournal, May 29, 2003)

REASSIGNMENT INFORMATION

Date Recorded: J uly, 25 2003Assignor: General Magic Inc. (Date signed 04/23/2003)Assignee: Intellectual Ventures Patent HoldingReassignment Kind: Assignment of Assignor Interest

Number of Patents reassigned: 20


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USPTO Patent Reassignment DataPatent Reassignments - 1980-2003

0

10000

20000

3000040000

50000

60000

70000

8000090000

100000

RY=2003

RY=2002

RY=2001

RY=2000

RY=1999

RY=1998

RY=1997

RY=1996

RY=1995

RY=1994

RY=1993

RY=1992

RY=1991

RY=1990

RY=1989

RY=1988

RY=1987

RY=1986

RY=1985

RY=1984

RY=1983

RY=1982

RY=1981

RY=1980

Rising faster than base of patents itself, from 0.1% to 4.0%


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Main Reassignment Kinds Assignment (of assignors interest)

Security agreement/termination

Government interest assignment Executive order 9424, confirmatory license

Merger

Change of Name

Other

From the examination of semiconductor class:

Change of Address

License

Confirmatory license

Conveyance of patent & trademarks

Correction to an error in the patent number

Release by secured party

Release of security interest in patents and tradem

Release of security interests

Security interest

Termination and release of assignment of security

Transfer by operation of law

Amended and restated patent and security agreement and mortgage

Offered as an option in thePTO 1595 form


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Reassignments in Semiconductors (H01L): 2003

Affiliated Co61%

License

1%Merging

2%

Other

6%

Securitization

23%

Ind. Inventors1%

Impure &

Autonomous

3%

Pure &

Autonomous

3%


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29

Security: US 5149397 Two reassignments for this patent:

Reassignment KindAssigneeAssignorDate

Security InterestJ PMorgan Chase BankXerox06/25/2003

Security InterestBank OneXerox06/21/2002

Patent: Fabrication methods for micromechanical elements, originally assigned to

Xerox corporation. Application date: 1991.07.03. Date issued: 1992.09.22


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Whats Going On?

Your findings are consistent with what Ihave seen. That is, I have seen more

security interests being taken in a

company's patent rights (typically tocollateralize debt).

The beginnings of a secondary market for

IP.


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IP Secondary Markets in the Future

Orphan recovery programs Failed Startup IP auctions

Use It or Lose It corporate policies

Bounties and Finders Fees

Sale-Leaseback programs

Patent roll-up strategies

Patent commons areas


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Agenda


Implications for Managing IP

9Policy Implications


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Policy Implications

Case Study: US economic malaise in the1980s

Autos

Steel

Consumer electronics

Shipbuilding

semiconductors


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US Resurgence in the 1990s

New companies, new industries PCs, networking, software

Internet

Biotechnology

New kinds of semiconductors

Note that the troubled firms in the troubledindustries did not improve much


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Closed v. Open Policies

Focus on expandingdomestic market

Protect localchampions from

foreign competition

Subsidize largestdomestic firms

Limit foreign studentsand foreign directinvestment

Focus on SMEs

Focus on universities

Focus on IP policies

Stimulate greatercompetition amonglargest firms

Stimulate greaterinformation exchangeand coordination


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Getting the Institutions Right

Public research funding The foundation of the innovation system

Focus on excellence, meritocratic award criteria

IP Clear, effective, but limited protection

Universities Meritocracy in research funding

Allow professors to engage with industry

Compete for best and brightest students

Enable research to move into industry


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The Challenge of Indirect Policies

No clear constituency

Time delay from policy change to results

Interaction among institutional factors, not asingle factor solution

We underestimated strength of US innovationsystem in 1980s We may be underestimating its weaknesses today

Note that Japan has regained ground, with a verydifferent institutional structure than US

Note that OECD estimates Chinas R&D > Japan


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Presentación de Henry Chesbrough