Carving out a greater role for intellectual property in Japan
Intellectual property (IP) can be complicated. Deciding what IP to protect, how to protect it and how to manage an IP portfolio can be difficult for any business. Startups and small and medium-sized enterprises (SMEs), for instance, may not be aware of the value of their IP or the importance of safeguarding it with patents and other forms of protection. Larger companies, on the other hand, may have plenty of patents but lack a clear IP strategy, meaning that they are failing to leverage their IP portfolio for commercial success.
One company that understands these challenges better than most is IP Bridge, Inc. The Japanese company was established in 2013 on the belief that increasing the value of IP not only increases corporate value but revitalizes industry and innovation. Working across licensing, consulting and innovation, its team of IP experts hail from a wide range of specialized fields, from manufacturing to finance. Together, they combine their diverse skills and extensive networks to help a broad portfolio of clients increase the value of their IP – including startups and large corporations.
IP Licensing: connecting patent holders and users
IP Bridge's licensing business focuses on working with patent holders (operating companies, research institutions, etc.) to unlock and enhance the value of underutilized patent assets. IP Bridge seeks to generate value from these assets while aligning the interests of relevant stakeholders, including patent holders and investors. IP Bridge plays a central role in evaluating opportunities, structuring arrangements, and pursuing value realization in a commercially practical manner. Depending on the applicable arrangement, proceeds may be shared with patent holders and investors.
Conclusion of an IP Licensing Agreement for semiconductors
A milestone in IP Bridge’s licensing business came in 2017 with the conclusion of a license agreement regarding semiconductor patents with Broadcom, one of the world’s leading manufacturers and suppliers of semiconductors. IP Bridge had built a portfolio of more than 700 semiconductor patents worldwide, and the patents it licenses primarily relate to manufacturing technologies used in a wide range of semiconductor products. Consistent with its approach of building a mutually beneficial relationship between patent holders and implementers. IP Bridge adopted a negotiation approach focused on constructive engagement. With the assistance of external counsel, it conducted meticulous investigations and formulated strategies, proceeding with negotiations while respecting industry negotiation styles. Although the negotiations did not initially result in a resolution, IP Bridge commenced patent infringement actions against Broadcom in the United States and China. Ultimately, the disputes were resolved through settlement, and the parties entered into a licensing agreement.
Standard Essential Patent Licenses
IP Bridge’s licensing business also includes licensing relating to standard essential patents (SEP), which protect inventions essential to the implementation of particular technology standards. In accordance with its policy, SEP licensing is being conducted with careful attention to FRAND (Fair, Reasonable, and Non-Discriminatory) principles. In 2021, the company prevailed in litigation against TCL Technology, a Chinese electronics company, involving SEPs relating wireless communication standards, and then, in 2023, the parties entered into a broader agreement that included patents essential to additional standards. As a core member of several patent pool platforms, IP Bridge contributes to efforts to enhance the value of IP and support innovation across industry.
IP Consulting services to develop effective strategies
In recent years, due to revisions to Japan’s Corporate Governance Code, IP strategies as a business asset have been attracting increased attention. Companies are now aiming to improve their corporate value by leveraging their IP rights, and there is a growing need for a greater understanding of the IP landscape when considering IP strategies.
In response, IP Bridge formed a business alliance with Daiwa Securities Group Headquarters to strengthen its consulting business. As a team of experts from a wide range of fields, IP Bridge is able to provide consulting services from the perspectives of both investors and business owners, supporting business to develop effective IP strategies. This helps their clients discover new markets, increase product sales and access untapped licensing revenues.
Supporting SMEs in IP Rights Acquisition and Commercialization
Since its establishment, IP Bridge has consistently championed SMEs as essential to the future of Japanese industry. SMEs often face a wide variety of IP challenges, such as acquiring IP expertise, establishing internal rules for IP management, and passing strict IP due diligence and clearance investigations from potential investors in venture companies. Accordingly, in its innovation business, IP Bridge has a track record of supporting the development of the IP of dozens of SMEs by leveraging its knowledge gained by monetizing IP rights in its licensing business. The company also combines IP and business consulting to provide rights acquisition and commercialization support for SMEs.
Innovation: acting as an IP department for SMEs
In effect, IP Bridge’s innovation business acts as an IP department for SMEs that do not have an in-house IP department. IP Bridge provides its clients with daily IP support, such as extracting application ideas, deciding whether to apply or not, helping to develop patent portfolios, considering responses to patent application refusals, connecting SMEs with external experts such as patent attorneys, and answering IP-related questions from potential investors and potential business partners. IP Bridge also takes the time to explain the importance of IP rights and the value of patents to its clients, something which SMEs may not be aware of.
From IP Strategy Support to IP Policy development
IP Bridge’s innovation team has acted as an IP department for a wide range of SMEs, including BONX Co., Ltd., a manufacturer of earphones for long-distance communication, and Lifelog Technology Co., Ltd., a healthcare technology company that has developed a health management app. One client, a small business making assisted motorless bicycles, was on the verge of closing after spending a significant amount of money on sample production. To help, IP Bridge supported from upstream to downstream product development – not only with IP strategy, but also with the collection of proof of concept data and consideration of development policy. IP Bridge also purchased patent rights, eliminating the burden of paying patent maintenance fees to business owners. As a result, the value of the patent increased and the business achieved significant growth.
Example of a company where the IP Bridge Innovation Business provides a pseudo-in-house intellectual property department function.（Alphabetical order)
A greater role for IP finance in Japan
IP Bridge’s ultimate aim, in addition to helping companies maximize the potential of their IP, is to change the IP finance landscape in Japan. Compared to the United States, IP licensing has not taken root in Japan because the risks and returns are not yet clearly visualized. Currently, the Financial Services Agency, a Japanese government agency, provides loans that use both tangible and intangible assets as collateral, and lending patterns are becoming more flexible. In the future, IP Bridge believes that IP finance will become increasingly active as financial institutions show more interest in IP-related businesses. IP Bridge is at the forefront of this shift and is playing its part to promote licensing and IP finance in Japan.
(Interview date: September 6, 2023)
