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Business support schemes:
Intellectual Property Survey (TBG-funded firms)

Summary

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Published: 1 Mar 2003 Tony Hadfield, Enterprise Edge Ltd., 2003.

Scope:

An evaluation of formal (codified) and informal (uncodified) IP that aimed to elicit information about the role of IP protection in maximising the commercial value from R&D. The evaluation looked at the success of completed projects funded through TBG?, 1990-2001, above $180k.

87 firms (with 95 TBG contracts) were invited to take part in a web-based survey (72% response rate of contracts). A further 27 firms (with 35 TBG contracts) were invited to take part in telephone interviews (9% of contracts).

Summary:

IP

  1. 89% of projects resulted in new IP.
    • Trade secret/confidential information (often combined with “first to market” and “innovation leadership” strategies) dominated as the most favoured approach to protect IP.
  2. 46% of firms considered some form of IP protection as the primary means of capturing value from their TBG R&D projects.
    • This IP protection was split into 58% (codified) and 42% (uncodified).
  3. In terms of the types of IP protection used,
    • 47% of projects used trade secret/confidential information, compared with 22% who used NZ patents, 26% overseas patents, 24% copyright and 23% trademarks.
  4. Many NZ firms did not see patents as an important tool in protecting their innovation and capturing commercial benefits from it. A number of firms used NZ patents as a means of accessing the overseas patent process, thereby delaying expenditure on overseas patents. Other firms used the filling out of patent applications as a strategic tool to deter competition while not finally going through with the full patent. The focus on uncodified IP reflected the size of firms and the cost of patent protection.

Collaboration

 

  1. 75% of projects involved collaboration with a CRI, university, research association or polytechnic.
    • Commercial outcomes were poorer in projects where research providers were involved in owning IP.
    • Collaboration between firms and research providers was very important for raising technological capability of firms and for maximising the return on Government investment into RS&T.
    • Views of firms as to whether research providers’ inputs represented “value for money” were mixed, but their technical input was mostly seen as helpful. People involved on both sides (firm and research provider), and the relationships between them, were important to the success of the project.

TBG impact

 

  1. Projects were described as technical successes in over 80% of cases.
    • Main success factors cited were quality of internal team (68%) external R&D input (39%) and project planning (32%).
    • 65% of firms indicated that the TBG projects resulted in an increase in their capability to undertake future R&D projects.
  2. 90% of projects resulted in new products, processes or services.
    • 83% resulted in revenues from those new products, processes or services.

Export focus

 

  1. TBG had supported many projects where revenues were primarily domestic.
    • 45% of revenue-generating projects obtained 0-25% of their revenue from exports compared with 40% of projects that obtained 75-100% of their revenue from exports.

    Initial success in the domestic market was important as a stepping stone to export markets.

    Support for non-exporters was appropriate where they were either indirect contributors to exports or demonstrated the capability and willingness to enter in to export markets.

Related work

Protecting and managing Intellectual Property: patenting decisions of publicly funded research providers, David Webber, Economics and Strategy Group, 2003.