Evolution of IP valuation

Reasoning that, within telecom, the fact that Google paid $12.5 billion is not a huge surprise given that the order of magnitude of sales of a cellular phone is a lot more than the high-end processors for personal computing, Anu points out that near four dozen lawsuits were filed against Android, simply because of its market share in the last two years. “The Android platform has more than 50 per cent market share of both Microsoft and Apple at a little over $300 billion in the mobile telephony/applications space. Google having to pay $12.5 billion to protect its Android IP problems for that portion of market share seems reasonable. What bears examination is the impact of the anti-trust cloud that Google is presently in accordance with on all acquisitions they make.” Our conversation continues over the email.

Typically, we use three elements for valuation – cost-based, market-based and revenue-based – as well thought of as value past, present and future. Timing and context are critical elements of the assessment. For instance, the complexity and customisation needed to create an asset may cause a high level of cost variability and outcome uncertainty.

As our products and services get smarter and more intelligent, with an increasing integration of IP, won't it be a healthy trend to inform the clients about the IP component of the price tag?

Any field of innovation – software having a lower time to create competitive advantages through creative engineering than say manufacturing or pharmaceuticals – is greatly accented by IP. All research cannot be converted to IP nevertheless the ones that define a company's core competence must be converted for sustainability and strategic advantages.