4.Acquiring IP in a Competitor’s Home Country

We will see in the next Chapter (Chapter Ⅵ: Defensive and Offensive Strategies) that IP portfolios can be used in a number of ways. At times, it may be necessary to create a threat to a competitor’s revenue streams. This is important as a counter-threat, where the competitor is threatening your country, either by aggressive market entry or pricing, or when a competitor brings IP litigation or threatens to do so. Preparing for this possibility is part of a good IP strategy. Put simply, to defend your own revenue you sometimes need to build a convincing threat that could put pressure on your competitor’s revenues.

There are two steps to creating an IP portfolio that covers (and thus threatens) a competitor’s products. The first is to understand those products, and obtain patents on the technologies and features that are important to them. This is the same process we discussed in Chapters 2 and 3. But in this case, you are acquiring patents that cover a competitor’s products, and not your own. We will discuss some details on this in the next Chapter (Chapter V).

The second step is to gain an understanding of where your competitor locates its R&D, manufacturing, assembly, and sales. It is the same process we have been reviewing in this section, but this time applied to your competitor’s operations. The basic idea is to consider acquiring some IP rights in countries that are important to your competitor, even if those countries are not important to you. Threatening a competitor in its various home bases can be an effective way to generate a counter-threat, if one is needed.