Recently, Matthias Ulrich – Managing Director at Connor Consulting, attended the May 2019 LESI or Licensing Executives Society International International conference held in Yokohama, Japan. As an expert in licensing compliance, Matthias participated on a panel of experts to discuss the implications of AI on patentability and licensing. This is a recap of that panel discussion workshop.
Together with my fellow panelists, Anne-Charlotte le Bihan – Partner at Bird & Bird LLP, Prof. Dr. Heinz Goddar from Boehmert & Boehmert, Dr. Felix Einsel – Managing Partner, Sonderhoff & Einsel Law and Patent Office, and Masato San, we discussed some aspects from the broad spectrum of AI-related opportunities. Recent reports from McKinsey and PwC indicate that AI, and the accompanying applications, such as automation and Deep Learning, will have a massively positive impact on our economies, with projections of additional value creation of up to $6B per annum through Deep Learning techniques, up to 1.2% additional GDP growth, and a premise that AI could add up to $15.7T in global economic output by 2030.
AI holds big promises: tasks can be optimized, human errors can be eliminated, AI can be applied across multiple industries and disciplines, and enhanced overall economic growth can be achieved.
AI also does bear some risks: costs to implement the right AI infrastructure, data and trust concerns, and potential displacement of up to 800m jobs by the year 2030. These risks need to be evaluated and managed accordingly, and it is not only the responsibility of governments to do so but for businesses and innovators alike. Important questions as to how to ensure privacy is protected, trust is established, and displaced workers are re-trained must be answered soon.
As the world continues to devote massive investment in AI-based innovations, patent applications are soaring, new fields of use are being discovered, and clear frontrunners are being identified. The US and China are leading the field, followed by Japan, South Korea, and Germany. Not surprisingly, corporations are filing most patents (e.g., IBM 8000+ and Microsoft 5000+), but there are also some Universities that are devoting great resources to do the scientific groundwork and apply for patents. Interestingly, the top 4 universities are all based in China. We need to be mindful of a potential inequality gap widening though, and help promote a healthy distribution of wealth and knowledge. Patenting AI is not that complicated – the hurdles are relatively low if the invention has a technological component, is non-obvious, and is novel.
Licensing AI-related patents and technologies is an important part of commercializing your IP investments. Finding the right customers, establishing the right royalty rates, setting up the proper licensing agreements are all important aspects. Licensing, as a form of making your proprietary invention accessible to others, will be an enormously important vehicle to enable further development and evolution of AI. With the advent of quantum computers, AI-based technologies and applications will transform our lives in dramatic ways.
Protecting your IP is paramount. But so is the protection of your ROI on those assets. Having a systematic and comprehensive IP Protection and Compliance program in place will allow you to reap the benefits from your licensing activities over the lifetime of the agreements. Ensuring early checkpoints to understand your licensees’ environment and determining risk factors will play a pivotal role in managing your financial risks, in that regard. Ensuring a level playing field will help your licensees to compete fairly, and help retain respective competitive advantages. The more systematic compliance is treated, the better the regulatory framework will become. This is going to be especially important in countries such as China, where non-compliance rates tend to be proportionally much higher than in other regions. But it is not only important for foreign companies to be treated fairly in China and have Chinese companies respect your License Agreements – China is already seeing the rise of big, IP-heavy companies (e.g., Huawei) who also needs their IP protected in China, and internationally. Such IP leaders will need to establish sound compliance programs as well and help change the rules domestically.
We at Connor can help you understand the market, licensing options and how to set up an effective license compliance program. With offices across the globe and a strong presence in APAC, our experienced staff can guide you and ensure you maximize your ROI on AI-driven inventions.
Contact us today to discuss how we can help you with your AI related licensing needs.