Licensing tends to be chosen in a distant market, when the market share of the licensor is small and when the downstream market is significantly competitive. Market for technology provokes effective internal management and organization of companies’ intellectual property.
On the other hand, for small firms, markets for technology increase the usefulness of strategies based on specialization of such firms in technology development. They do not need to incur expensive and shaky investments in downstream assets and can profit from their research even if they lack the complementary assets.
Because markets for technology also contain firms as technology buyers, the growth of such markets increases the importance of external of monitoring of technological developments and it increases the penalty of insularity and not invented here syndrome. The advantage of possessing some critical knowledge or technology may be limited by the ability of competitors to acquire the technology from other source, so markets for technology can also decrease the relative importance of technology as a source of distinct advantage.
For large technology based-firms, markets for technology boost the strategy space and firms can choose to license their technology rather than only depend on internal exploitation. The licensing decision is propelled by the interaction of the profit dissipation effect from licensing. This result from increased competition and the revenue effect from licensing which is caused by economic compensation paid by the license for accessing to the technology.
Companies should focus on other internal assets that provide them with distinguished advantages.
Glader, M. (2006). Innovation markets and competition analysis: EU competition law and US antitrust law. Camberley, UK: Edward Elgar Publishing.
Compare to the pure competitor, the monopolist has a longer lifetime and therefore it allows the firm to have more opportunities for research and development from which the firm will reap the benefits. This might bring production cost down, lowering prices, increase production rates and raise the quality of goods (Ulbrich, 1990). The development of technological innovation will overcome technology barriers and allowing the growth of a new era of prosperity, hence fortifying why economy would benefit from monopolies that conducting research and
...onsumption, the market becomes free to enter. As long as the change is based on technological advancement that doubles its capacity every six month meaning grows up to infinite, and as long as not depending on finite natural resource, the technological market in the future will be a competitive market.
Existing firms have cost and performance advantage in this industry. This is because existing firms have already purchased large capital expenditures and have economies of scale. They also have direct supply and distribution channels setup
As our text explains, "The action of competitors exerts pressure to put more money now into marketing, research, and product development" (Drafke, 2009. p. 143) it is truly a never ending competition. Therefore, there are many aspects that affect the resources a business has to work with from prices of product, operating costs, payroll, and many more. The business world uses all its resources to stay on top of the competition. . That is why any business must stay on the forefront of technology, as this is a huge asset in the world today for any business. It must use technology help in managing time, cost containment, and product in order to compete in this world of overabundance
...price, it also allows for them to increase their sales and enter into new markets, which in turn would help to increase their profits.
Competition for insurance money causes facilities to increase their technology to attract the insured. Once one facility has increased its technology other facilities need to increase their technology to remain competitive.
Absolute Monopoly - this is what it means! The people who have come up with the idea of protecting the innovation and so called rewards to the innovators never thought that what it may mean to the corporations and how it will kill the innovation in the software industry. As Stallman said “Software patents are a danger that affects all programmers and all computer users. I found out about them of course in working on Free Software because they are a danger to my project as well as to every other software project in the world.[ii]” I truly agree with Stallman’s view of the Patent. Now a day the number of patents is growing exponentially and due to open trade (software specially) internationally the patent law of one country is influencing the law in the other. Country like India where the software industry is growing at a tremendous pace and the US companies generate most of the business, people in India may advocate a law similar to US. Right now the state of the law is much stricter th...
Intellectual property protection has become increasingly popular in the last century. Many factors have probed interest in this area of the law. A few of those factors include musicians seeking protection of their musical talents through use of copyrights, companies seek to protect inventions of advanced production capabilities, companies create trademarks that differentiate their unique goods from competitors, and companies like Coca-Cola protect their undisclosed ingredients for their products through use of trade secrets. These examples are to gain an understanding of how and why intellectual property rights help companies seek advantages in the marketplace. Furthermore, as the world shrinks because of advancements in transportation and computer technology, intellectual property rights become a large part of entrepreneurship and product development. This paper will discuss the interesting and challenging topic of intellectual property protection. The four basic types of intellectual property include copyrights, patents, trademarks and trade secrets; we will discuss the intellectual properties in the order in which they are listed.
Slater, S. (2005). Successful development and commercialization of technological innovation: Insights based on strategy type. The Journal of Product Innovation Management, 23(1), 26-33. Retrieved from http://onlinelibrary.wiley.com/doi/10.1111/j.1540-5885.2005.00178.x/citedby
Reed, R., Storrud-Barnes, S., & Jessup, L. (2012). How open innovation affects the drivers of competitive advantage: Trading the benefits of IP creation and ownership for free invention. Management Decision, 50(1), 58-73.
Today, the technology sector has been dominated by various companies all competing to gain the huge market share that has created great rivalry amongst many organizations even leading to the acquisition and rebranding of some like Nokia and Motorola. Under the defensive strategy, most companies employ this technique to discourage new
In his analysis, Charles Fine goes on to note that as the speed of an industry accelerates, the advantage one company may gain shortens – advantages are temporary. This conclusion is somewhat intuitive since the research and development to production cycle gets s...
...s and partly, to gain a competitive advantages in the global market. Thus, the company spends billions of dollars in innovative research activities to add new knowledge into the existing knowledge.
A typical example of the resource based school is an organization that has patented its products so that competitors are under obligations not to copyright these products. Additionally, having an installed customer base is a resource of an organization coupled with its brand equity. Apple Inc. is an organization whose resources and capabilities cannot be easily and effectively copyrighted in the technology industry. This is the source of Apple’s competitive dominance in the market in general.