The Intersection of Licensing and Monetization

Licensing is your pathway to monetization.  You realize returns on a patent investment by granting licenses to third parties in exchange for value.

What is a license?

A license is a right to use a patented invention–specifically, a right to make, use, sell, offer to sell, and import into the U.S. a patented invention.

A patent holder, and only the patent holder, has the right to grant a license to third parties (provided the patent holder does not grant an exclusive license or the right to sublicence to other parties–I’ll be discussing this in successive posts).

This right stems from the government issuing the patent, and agreeing to enforce the patent holder’s right to prevent others from practicing the invention.  A third party can practice a claimed invention only after a patent holder grants a license to the patent.

From a monetization perspective, the more licenses you grant with respect to your patent asset, the more you are realizing the patent asset’s monetization potential.  Hence, your goal as a patent owner is to grant as many licenses as possible, at a price point that maximizes value.


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