The Mindvault Experience

The True Cost Of Intellectual Property Piracy

In the past week, you may have noticed that piracy, counterfeiting and Intellectual Property (IP) infringement has been in the news – Minister Datuk Mohd Shafie Apdal has committed to host the Global Congress on Combating Counterfeiting and Piracy next year; Attorney-General Tan Sri Abdul Gani Patail is concerned that IP Infringement is killing our creativity and Recording Industry Association of Malaysia (RIM) estimates the cost of piracy to the local music industry to be RM100mil per year!

Counterfeits and piracy are not new to Malaysians – in fact the existence of Petaling Street, mobile VCD vendors that ply food courts in the evening and Imbi Plaza make it part of our day to day lives. The average Malaysian does not see what the big fuss is about because they don’t see how the $$$ affect their pockets…if anything, it makes their money go further. RM9 for a DVD which you can watch in the comfort of your home with 5 friends versus RM12 per person to go to the cinema…the math speaks for itself.

The government is doing its best but unless the public (ie taxpayers) are educated as to how piracy affects them (personally) and the nation as a whole, we will not be solving the problem at its roots.

I wonder whether the average taxpayer is aware that in supporting the pirate industry and buying counterfeit goods, they are ultimately the losing party?

Do we realize that in view of intense local and international pressure to curb piracy, our government is forced to conduct extensive and on-going raids – funded by us, the taxpayer! Lower tax revenue from legitimate sales ultimately means that funding for education, healthcare and public amenities is reduced. Again, who suffers? The taxpayer!

The public needs to be aware of the fact that the counterfeit products they purchase is sustaining an underground industry – and therefore ultimately directly funding an industry that engages in drugs, weapons, prostitution and other illegal activities. Crime and criminal activities cause untold evils and result in an unsafe environment for us and our families. We complain that the police do not respond quickly and effectively to crime and yet how can they when resources are stretched curbing illegal activities that we are funding?

Now isn’t that something worth thinking about?

Posted by:Renuka Sena on 24/11/2005 3:01:12 PM

The Mindvault Experience

The Star Online Education: Protecting Intellectual Property

THE BIGGEST misconception about Intellectual property (IP) rights and higher education is that it involves research and development only.

As Malaysian higher education becomes more developed, local universities and colleges need to look at protecting their property rights in terms of research, course content and projects.

IP specialist and consultant Renuka Sena says that currently, Malaysians are in a period of transition, moving from being IP users to IP creators, and learning to come to grips with the technicalities involved in acquiring IP.

“We (Malaysians) are slowly becoming IP creators and looking into protecting our products and creations. Thus far, IP is looked at as a legal area but it is also business and technology related as well.”

Click here for the full article.

Posted by: Renuka Sena on 21/11/2005 11:38:19 AM

The Mindvault Experience

Bernama: Malaysia Aims To Host Global Intellectual Property Crime Congress

Malaysia is vying to host the Global Congress on Combating Counterfeiting and Piracy next year to show its commitment to eradicating intellectual property crimes.The congress is supported by the World Customs Organisation and the World Intellectual Property Organisation (WIPO).

Domestic Trade and Consumer Affairs Minister Datuk Mohd Shafie Apdal said the proposal to host the congress would be tabled in the Cabinet soon.

Click here for the full article.

Posted by: David Oh on 20/11/2005 10:27:42 AM

Bernama: USA, Malaysia To Jointly Combat Intellectual Property Rights Infringement

The United States and Malaysia will work closely, including sharing technical assistance, to address the ongoing infringement of Intellectual Property Rights (IPR).

Attorney-General Tan Sri Abdul Gani Patail said the US was concerned about infringement of IPRs in Malaysia and his counterpart, Alberto R. Gonzales, also raised the matter when both met here Thursday.

“We are equally concerned and the US is not the only one complaining, our people are also complaining. Our artistes and actors are also complaining and they have written a lot of letters,” Gani told reporters after meeting the US attorney-general who was on a brief stop-over here.

“We are losing too much for a simple reason. It is killing our creativeness. People are not going to be creative if we allow these infringements,” he added.

Click here for the full article.

Posted by: David Oh on 18/11/2005 9:00:02 AM

The Star Online TechCentral: RIM Goes The ‘Civil’ Route

The Recording Industry Association of Malaysia (RIM) hopes to bring down the current piracy level by as much as 50% within the next three to five years.

It said it intends to do this by taking civil action against licensed CD plants that are involved in music piracy.

‘We are saying three to five years because the court process may take that long,’ said RIM chief executive officer Tan Ngiap Foo.

RIM will take these CD plants to court to claim damages and get injunctions. ‘We are not just waiting for criminal action (to be taken by the Government),’ said Tan.

Click here for the full article.

Posted by: David Oh on 16/11/2005 11:32:11 PM

New Straits Times: Largest Seizure Of Music CDs

The biggest piracy syndicate in the country suffered serious losses when 45,000 pirated music CDs and master stampers that could replicate one million CDs were seized in a raid.

The bad news: Not even one member of syndicate was arrested.

Based on the quantity of goods seized yesterday, the Domestic Trade and Consumer Affairs Ministry says the syndicate was involved in manufacturing, packing and distributing the pirated music discs to retailers all over the country.

Click here for the full article.

Posted by: David Oh on 27/10/2005 4:28:39 PM

New Straits Times: Common Link Across Boundaries

Malaysia is the latest country to join the Creative Commons effort which enables creators to publish and share their works online.

“Creative Commons makes it easier to share creations across boundaries, time and space by the use of creative commons licences,” said Dr Alina Ng, a senior executive with the Multimedia Development Corporation, which is initiating the project here.

A creative common on-line resource enables one to generate an individualised, legally enforceable copyright licence.

As of May this year, there are nearly 16 million digital objects accessible over the Internet linked to a Creative Commons licence, including scientific journal articles, music files, picture files and weblog pages.

Founded in 2001 by a group of cyberlaw and intellectual property experts, Creative Commons is now used in 20 countries and a further 11 are in the process of customising Creative Commons licences.

Malaysia is the latest country to join the creative commons effort. MDC hopes to launch Malaysia specific creative commons licences on the internet by the year’s end.

Click here for the full article.

Posted by: David Oh on 26/10/2005 1:56:01 PM

The Star Online TechCentral: RIM, BSA Applaud Arrests Of Suspected Pirates

Music pirates are less inclined to hawk their wares in the open, now that they can be arrested for the offence, said the Recording Industry Association of Malaysia (RIM).

“We don’t see them in their usual haunts,” said RIM chief executive officer Tan Ngiap Foo.

Suspected music pirates could only be issued with summonses until the copyright law was amended in 2003 to give Domestic Trade and Consumer Affairs Ministry officers the power of arrest.

Tan said 27 arrests were made over the past two months and this is having an impact on music piracy in the country.

Click here for the full article.

Posted by: David Oh on 25/10/2005 9:35:21 AM

Seizure Of RM150,000 Equipment For Digital Karaoke Machine

Domestic Trade and Consumer Affairs Ministry enforcement officers have seized RM150,000 worth of equipment, computers and TV sets used for a paid digital karaoke service in Kuala Lumpur because of the use of pirated software.

The ministry’s Intellectual Property Unit Director, Iskandar Halim Sulaiman, said the seizure was made under the “Ops Tulen Muzik II” raid by the enforcement team at about 1.10 p.m. Thursday at an entertainment business outlet at the Pertama Complex in Jalan Tuanku Abdul Rahman.

He said the outlet was believed to be carrying out its business of offering song request services for paid digital karaoke songs using pirated software, adding that unauthorised copying of digital data and songs was also prohibited.

The jukebox karaoke operator may face a whopping RM29 million in fines if he’s found to have used unauthorised digital copies of karaoke recordings.

People have been paying RM1 per song over the past two months to sing to their heart’s delight using pirated software.

Click here for the full Bernama article.

Click here for the full Malay Mail article.

Click here for the full New Straits Times article.

Posted by: David Oh on 22/10/2005 11:55:59 PM

Computimes: Awareness On Local IP Rights Lacking

LOCAL software developers attempting to commercialise their software products should be more aware of their intellectual property (IP) rights and take the necessary steps to protect them.

Mindvault Sdn Bhd’s director David Oh told CompuTimes that although the country has sufficient IP laws to protect software developers, there is still lack of awareness among software developers on the importance of protecting intellectual assets.

“The problem is not the local IP laws but the lack of awareness in the law. Hence, software developers must be better informed of the IP rights via seminars or by talking to IP specialists.”

Click here for the full article.

Posted by: David Oh on 18/10/2005 10:01:11 PM

What Does Better Intellectual Property Enforcement Mean?

We often hear that Malaysia needs to improve its enforcement of Intellectual Property (IP). Just recently, the US Ambassador to Malaysia made this call. So, what exactly does “better enforcement” entail?

For one, it requires more effective courts and by that I mean

  1. Faster court procedures and

  2. Specialised IP judges.

Legal proceedings in Malaysia are known to take a long time and justice delayed is justice denied. Surely the courts are aware that while the case is pending and the IP owner can do nothing but wait, the infringers are not waiting – they are busy “making hay while the sun shines”. By the time the case is finally heard the infringer would have disappeared or wound up his operations, leaving the IP owner with nothing to claim. When it comes to enforcement, time is of the essence.

Having specialised IP judges is another key component of better enforcement. IP can be a complex subject matter and the lack of IP judges results in slower court proceedings and sometimes questionable decisions. IP judges would also better appreciate the gravity of IP infringement and be more willing to apply the full penalties under the law to deter future infringers.

In this connection the establishment of an IP court in Malaysia will be welcomed and I hope that it will happen soon.

Posted by: John Chong on 10/10/2005 10:21:55 AM

Business Times: Support Products Developed By Universities, Firms Told

THE Ministry of Higher Education hopes more companies would commercialise research and development (R&D) products developed by university researchers, said its director-general Datuk Prof Dr Hassan Said.

“Previously, we used to be buyers of technologies. It is now timely for us to take the products out of the laboratory and into the market,” he said.

Hassan said commercialisation of intellectual property (IP) from higher learning institutions and research institutions has been practised by advanced nations.

The future development of industries in Malaysia focuses on new high-growth sectors that are transforming into competitive and full-fledged skilled-based areas in biotechnology, information communication technology, advanced material and advanced manufacturing, the results of which would be the supply of goods and services to the global market.

Click here for the full article.

Posted by: David Oh on 1/10/2005 3:29:17 PM

Daily Express: Awareness Level On Copyright In Sabah Increases

The Intellectual Property Corporation of Malaysia (MyIPO) said awareness on copyrights in Sabah has increased significantly over the years.

Its Director of Copyright, A. Manisegaran, said this is reflected through the attendance level at a seminar on copyright law on Wednesday.

“This is the fourth year we have been coming to Sabah and we found that the level of participation has reduced although we have sent out more than 200 invitations,” he said.

Click here for the full article.

Posted by: David Oh on 30/9/2005 8:33:44 AM

TODAY Online: Fish Versus Fish – Local Seafood Chain Wants Rival To Stop ‘Copying’ Concepts

The two restaurants serve similar Western-style seafood in shallow metal pans. They also both use seafood-related slogans – while one said it had “Something Fishy”, the other used “Nothing Fishy About It”.

But last Tuesday, OB Singapore Operations, which owns the Fish & Co chain of restaurants, sued rival Manhattan Fish Market (MFM) Restaurants for backing out of an agreement that was signed in April to draw the boundaries.

“The law recognises the rights of an owner over his intellectual property and the owner is entitled under the law to prevent another party from using any of his intellectual property without his consent or authorisation,” said Mr Jonathan Kok, a partner at Harry Elias Partnership.

Click here for the full article.

Posted by: David Oh on 29/9/2005 9:19:32 PM

Business Times: Better Enforcement Of Malaysia’s Intellectual Property Rights Law Needed

A LACK in enforcement of intellectual property rights (IPR) may hinder the steady and strong growth in bilateral trade and investment between Malaysia and the US.

US Ambassador to Malaysia Christopher J. LaFleur said there are some key areas the US would like the Malaysian Government to make some progress in, one of which is to better enforce laws protecting IPR.

He said Malaysia wants to become a knowledge-based economy so that living standards will increase and the country can stay ahead of the global cmpetition.

Much of that needed knowledge is going to come from abroad, in the form of foreign investment. But foreign investors are not going to bring their valuable knowledge here if it cannot be protected,” he said in his lecture on the Malaysian-American relations organised by Universiti Malaya’s law faculty in Kuala Lumpur yesterday.

Click here for the full article.

Posted by: David Oh on 22/9/2005 5:39:59 PM

Bernama: Efforts To Produce Entrepreneurs Among Scientists

Efforts will be made soon to produce entrepreneurs among scientists at universities in Malaysia, especially those involved in biotechnology, said Science, Technology and Innovation Minister Datuk Seri Dr Jamaludin Jarjis.

He said he would submit a proposal to the cabinet for discoveries that are made by local scientists to be given intellectual property rights so as to attract them to become entrepreneurs.

“I will also discuss with the Higher Education Minister to find ways to encourage professors or doctors at local universities to be involved in laboratory testing work and try themselves in the field of entrepreneurship,” he told reporters here Tuesday.

He said among the proposals was for businesses to partner universities in jointly commercialising the discoveries made at the labs.

Click here for the full article.

Posted by: David Oh on 22/9/2005 5:15:15 PM

ASEAN Economic Bulletin: From Grain-Sized Innovations To Triple-Test Patents in ASEAN: Patterns, Issues, And Implications In Development And Competitiveness

Widely famous for its economic dynamism, ASEAN is not well known as a region of intellectual property creation.

Patented assets owned by regional entities have remained very small in volume, notwithstanding the fast-paced, electronics-based transformation in regional production and trade from the 1990s. This is a matter for significant concern because inventions and innovations are the foundation of durable comparative advantage, higher value addition, and high value-added activities.

Inevitably, the technological creativity and capabilities of ASEAN have to be shifted upwards for better synergy with the greatly intensified global competition, the accelerating technological progress, the more sophisticated and exacting market requirements, and the stronger and broader protection of intellectual property rights.

The transition process will be highly demanding on resources, imagination, and perseverance, not least because capacity- and institutional- building requires lumpy investment, changed mindsets, and long periods of gestation.

Nevertheless, the outstanding and speedy transformation in microelectronics capabilities among the East Asian developing economies gives grounds for guarded optimism as regards the prospects for transitional success among the miracle economies in Southeast Asia.

Click here for the full article.

Posted by: David Oh on 22/9/2005 4:41:55 PM

Gordon Petrash: Opportunity For Malaysia To Develop Its IP Capabilities

Malaysia has an opportunity to develop its Intellectual Property capabilities to be on a par with the best countries in the Pacific Rim. It is a relatively small country with an active inventor population in its major industries, small and medium companies, entrepreneurs, and Universities. This inventor community is not presently focused on obtaining IP. It is, however, as innovative as their neighboring countries. This lack of focus can be changed effectively and quickly if the government ministries can provide an environment that IP could flourish. This focus will need to be instigated with both a disciplined set of IP requirements in order to obtain government R&D grants, and incentives that will reward inventors with recognition, successful implementation of their IP and personal financial benefit.

This change of focus could be accomplished through natural market dynamics but that would probably take too long and may not be as effective. Creating an IP culture for Malaysia will need a coordinated effort by government, the IP community and the inventor community. The government needs to create regulations that enable IP creation and that require IP-related activates tied to its grant programs. Government commitment to IP will accelerate the needed changes and institutionalize them. This government initiative can take on a number of different forms. It can range from advisory and peripheral to aggressive and active involvement. Some approaches that were discussed during our interviews with various IP and government leaders during our trip to Malaysia last week were:

  • Creating a government holding company that would manage a portfolio of IP for the projects and companies it has a stake in

  • Using a government subsidized private Malaysian firm to manage IP for small and medium companies

  • Creating a standard for government grants to include a disciplined IP consideration as part of its awarding decision

  • Using the government’s pulpit to promote, support and incentivize the obtaining and managing of IP

  • Support and encourage private IP firms to offer services to companies that could not otherwise afford to

Malaysia has the benefit of learning from companies and countries that have successfully created an IP focus. Countries like Ireland, India, and Sweden along with IBM, Dow Chemical and Hewlett Packard all provide successful examples of raising IP to a level that significantly and positively impacts their financial bottom line. We believe Malaysia can accomplish this same transformation quickly and effectively with the caliber of people in all sectors of the country. All it will take is leadership and commitment.

Posted by: Gordon Petrash on 21/9/2005 10:36:40 AM

Mindvault Secures Rights From US Based PetrashWilliamson To Deploy Best Practice IP Tools In Malaysia

Mindvault Sdn Bhd, a leader in Intellectual Property (IP) and Intellectual Asset Management (IAM) solutions, today signed a memorandum of understanding (MoU) with US based PetrashWilliamson to license and deploy best practice Intellectual Property Asset Management (IPAM) tools in Malaysia. This is the first time that these tools will be made available in the South East Asian region.

The tools, LighthouseTM and CompassTM, which are targeted at growth companies, R&D Institutions and large corporations, are the first of their kind to be deployed in the South East Asian region. When deployed, these tools will enable organizations to better measure, manage, and leverage their Intellectual Assets.

LighthouseTM is a ready-made IPAM Intranet Portal. It is a database of IPAM knowledge, including process and methods; standard forms and agreements; training documents; contacts; Q&A’s; strategy and tactics; terms and definitions; and links to other IPAM resources.

CompassTM is a comprehensive library of IPAM resources. It consists of Microsoft Word, Excel, PowerPoint, and PDF documents. The organization of the documents is indexed and can be key word searched for easy retrieval and finding of pertinent information.

Click here to read the full press release.

Posted by: David Oh on 13/9/2005 11:57:00 PM


September 13, 2005, Kuala Lumpur: Mindvault Sdn Bhd, a leader in Intellectual Property (IP) and Intellectual Asset Management (IAM) solutions, today signed a memorandum of understanding (MoU) with US based PetrashWilliamson to license and deploy best practice Intellectual Property Asset Management (IPAM) tools in Malaysia. This is the first time that these tools will be made available in the South East Asian region.

The tools, LighthouseTM and CompassTM, which are targeted at growth companies, R&D Institutions and large corporations, are the first of their kind to be deployed in the South East Asian region. When deployed, these tools will enable organizations to better measure, manage, and leverage their Intellectual Assets.

LighthouseTM is a ready-made IPAM Intranet Portal. It is a database of IPAM knowledge, including process and methods; standard forms and agreements; training documents; contacts; Q&A’s; strategy and tactics; terms and definitions; and links to other IPAM resources.

CompassTM is a comprehensive library of IPAM resources. It consists of Microsoft Word, Excel, PowerPoint, and PDF documents. The organization of the documents is indexed and can be key word searched for easy retrieval and finding of pertinent information.

Speaking at the signing ceremony, Mindvault Chief Executive Officer Renuka Sena said: “Properly managed intellectual assets can yield ROI from IP for products and technologies developed by local companies. Intellectual Assets need to be managed systematically in order to reap long-term rewards. These tools go beyond knowledge management, document management and data mining which is often seen as a means to capture and manage corporate intellectual property.”

“Knowledge capture alone does not equate valuable intellectual assets. It is the ability to recognize the value each Intellectual Asset brings to the organization and the implementation of effective routes to commercialization that will yield economic value.” Renuka added.

“This partnership with PetrashWilliamson, a world leader in IPAM, signifies our commitment to partner with and assist local organizations to create a competitive edge for their business and pro-actively manage intellectual property to compete in the global market.”

PetrashWilliamson co-founder and partner Gordon Petrash said: “The Pacific Rim will be an even more important world player in technology and resulting Intellectual Property in the near future. PetrashWilliamson is looking forward to participating in this growth via its partnership with Mindvault. The combination of both firms brings a comprehensive set of experiences and competencies that will greatly help companies in Malaysia and other countries successfully reach this exciting future.”

Further commenting on the tools, PetrashWilliamson co-founder and partner Rob Williamson added: “The PW tools aid companies with proven best practices based on leading companies’ methods and techniques. It allows a company to jump start their IP management programme.”

Statistics between 2003 and 2004 from the Intellectual Property Corporation of Malaysia (MyIPO) indicate that the top 10 foreign countries that filed patents in Malaysia are the United States, Japan, Germany, the United Kingdom, Switzerland, France, the Netherlands, Taiwan, Sweden and Australia.

In 2003, there were approximately 1500 applications from US entities, approximately 900 from Japan, 500 from Germany and approximately 400 from the UK. The number of applications from Malaysian entities stood at only 500. However in 2004, filings by Malaysian entities rose to approximately 750 Patent applications which shows not only increased awareness of IP but also the determination of Malaysian companies to protect the economic value of their R&D efforts.

Renuka added: “This trend in Patent filings is encouraging and signals the coming of an era for local organizations. These tools from PetrashWilliamson will be customized by Mindvault to suit the Malaysian environment thereby helping to foster creativity and innovation to assist growing organizations achieve a competitive edge.”

About PetrashWilliamson

PetrashWilliamson is an intellectual property asset management advisory that partners with clients in the development of their Intellectual Property Asset Management (IPAM) tactics, organization, and processes in support of their corporate and business strategies. These efforts are often global and comprehensive and emphasize direct measurable links between the key value drives of Shareholder Value and IAM. Strategy, organization, and process are best understood in the context of the PetrashWilliamson’s IPAM approach. PetrashWilliamson experiences include Fortune 100 companies, mid-size and start ups.

About Mindvault Sdn Bhd

Mindvault Sdn Bhd is a recognized leader in Intellectual Property and Intellectual Asset Management in Malaysia. The Company which was founded in 2000 comprises three main divisions namely Protection, Commercialisation and IAM. Mindvault’s goal is to empower their client’s to protect, grow and realize the value of their Intellectual Assets through innovative, solution-oriented and a systems-driven approach to identifying, managing and commercializing Intellectual Assets.

One Week With Gordon Petrash

One of the most quoted examples in IP circles is the story of The Dow Chemical Company. In 1992, Dow conducted an audit of its 30,000 patents. Based on the results of the audit, subsequent business decisions produced more than US$100 million in revenue and savings of more than US$50 million. The person who led this exercise was Gordon Petrash. Hence, it was a real privelege to have him in Malaysia this past week.It was 2 years ago when I first made contact with Gordon via email and it’s almost like a dream to finally meet him in person. We have been bandying around the term “Intellectual Asset Management” and now we finally meet the person who coined it while he was at Dow.

Nothing substitutes the wealth of experience one posesses and Gordon carries with him years not only at Dow but also at Delphion and PricewaterhouseCoopers. Therefore, it was a real privilege to have been able to spend a week with him.

2 things struck me about Gordon. Firstly, he is very passionate about his field. There was a real chemistry between him and Mindvault as similarly, we are not just running a business but are truly passionate about the IP field. Secondly, Gordon came across as having a “father’s heart”. I sensed that he was more than willing to mentor us and share his knowledge with the goal of leaving a legacy behind. Perhaps this has a lot to do with the fact that he has 7 grandchildren!

It is our dream that Mindvault’s collaboration with PetrashWilliamson will produce significant development of the IP landscape in Malaysia. It is often said that Malaysia is 5 years behind the West and is always playing “catch up”. Well, now, we have access to the best practice tools and methodologies in the field of Intellectual Asset Management in the US.

I hope corporate Malaysia truly appreciates this opportunity and takes full advantage of it.

Posted by: David Oh on 10/9/2005 5:45:10 PM

The Star Online: SMIs Urged To Develop Competitive Global Brands

SMALL- and medium-sized industries (SMIs) and small- and medium-sized businesses should create and develop brands that can compete globally, said Asia-Pacific Brands Foundation chairman Tunku Tan Sri Imran Tuanku Jaafar.

“Local SMIs should no longer just manufacture goods, but also focus on creating positive branding for Malaysia,” he said at the launch of The Brand Laureate in Kuala Lumpur yesterday.

Asia-Pacific Brands Foundation, headquartered in Kuala Lumpur, is a non-profit organisation committed towards promoting and improving branding standards in the region.

Click here for the full article.

Posted by: David Oh on 7/9/2005 4:33:10 PM

Bernama: Innovation, Branding And Leadership The Way Forward, Says PM

Innovation, branding and leadership are the three vital traits which need to come together for the country to face the ever increasing competitive world, says Prime Minister Datuk Seri Abdullah Ahmad Badawi.

“For me, the three themes of innovation, branding and leadership encapsulate the demands on Malaysia and every developing country that aspires to be successful in these challenging times.”

“The three concepts touch upon the fundamental questions of national advantage, namely what we do, how we are perceived and how consistent we are in reaching our goals,” he said in his keynote address at the opening of the two-day Global Leadership Forum here Tuesday.

Click here for the full article.

Posted by: David Oh on 6/9/2005 6:45:10 PM

A Significant Move Forward For IP Development In Malaysia

On Aug 4, following his speech at the IBM Forum 2005 in Kuala Lumpur, Minister of Science, Technology and Innovations Datuk Jamaludin Jarjis urged Malaysian companies to innovate for future growth. He said the private sector could apply for funds to acquire intellectual property (IP) and technologies.

The funds currently come from the RM1.5 billion allocated to the ministry under the Eighth Malaysia Plan but Jamaludin said he is asking for more under the Ninth Malaysia Plan.

“We are not very happy with the percentage of commercialisation in the public sector and we want a balance. Some research can still be public sector-led but we also want research to be private sector-led. They put in a dollar, we put in a dollar and then we go and buy the IP. We want R&D to be private sector-led and we are looking for technology asset tools to create economic value. That has to be the end-game. It must create economic value, it must create jobs and it has to be technologies that can develop the economy,” he said.

This move by Mosti is a significant one in elevating the level and quality of innovation in Malaysia. If local entrepreneurs and scientists are to grow, they have to be recognised as two separate groups, where funding and resources are allocated based on the needs of each group.

As the minister aptly pointed out, if Malaysians are to accelerate their growth and innovation capability, the acquisition of IP would provide significant value by acting as a springboard to commercial endeavours. The Japanese government used this model with much success.

Posted by: Renuka Sena on 29/8/2005 5:53:46 PM

Star Techcentral: Govt Urged To Have Special ‘Surfer’ Unit

The Government should set up a special unit to surf the Internet for local websites distributing illegal copies of movies, music and software, said representatives of the industries.

The unit, said the Recording Industry Association of Malaysia (RIM), could comprise Domestic Trade and Consumer Affairs Ministry officers, and would deal solely with online piracy.

Antipiracy watchdog Business Software Alliance and the Motion Picture Association have joined RIM in urging the Government to set up the unit.

Click here for the full article.

Posted by: David Oh on 26/8/2005 5:23:41 PM

Mindvault Nominated for Technopreneurs Association of Malaysia (TeAM) Merit Award

Last night, I was at the TeAM Industry Dinner 2005 at the Marriott Hotel in Putrajaya. The reason I was there was because Mindvault was nominated for the TeAM Merit Award for Oustanding Group Contribution to Technopreneurship. We were nominated along with Malaysian Debt Ventures (MDV) and the Cradle Investment Programme (CIP).

When I heard about the nomination, I actually wondered why we were nominated. You see, in the course of our business, we never set out to do what we do to win awards. We do what we do because we are passionate about what we do.

So, it was a real surprise to receive this nomination. I actually wondered what made us deserve this award. It was only at the dinner table when our nomination was announced that it dawned on me. The person sitting next to me asked what we had done for technopreneurship and it just came to me how we have really invested a lot of time to educate the ICT sector about the importance of Intellectual Property protection, management and commercialization.

From the days we were involved with MAVCAP’s “Ignite The Technopreneur Fire!” program to conducting sessions with the Technoperneur Development Flagship of MDC as well as speaking to university researchers via the National Unipreneur Development Program (NUDP) as well as numerous other workshops and clinics with organizations like the MCA ICT Resource Center (MIRC), it dawned on me how much time we had actually devoted to supporting technopreneurship in Malaysia.

Looking back, it has been a rewarding journey and it is nice to be recognized for our efforts.

By the way, we didn’t win the award. CIP deservedly received the honor.

Posted by: David Oh on 21/8/2005 11:00:41 PM

Our Dream Of An IP One-stop Shop Coming Closer To Reality

In December 2003, we wrote an article in the Netvalue pull-out of The Edge about “Building a one-stop shop for IP”. The concept and feasibility of the one-stop shop was the subject of a recent study by the World Intellectual Property Organisation (WIPO) where Mindvault was appointed as the country consultant for Malaysia.

In 2004, the ASEAN secretariat requested WIPO’s assistance to conduct a feasibility study on the establishment of IP-related business development service (IPDBS) hubs in ASEAN based on a network model. The study was conducted at the local level for each country and will then be consolidated into a regional report that will eventually be presented to the ASEAN secretariat probably later this year or early 2006.

It may be some time before the ASEAN IPDBS hubs can be realized given the challenge of achieving consensus among the ASEAN countries. It is our hope that Malaysia would take a lead role to set up a structure that can be replicated throughout ASEAN. We are well-positioned in terms of our infrastructure and capability to do so.

Posted by: John Chong on 15/8/2005 11:45:59 PM

Bernama: Abdullah Tells Companies To Adopt Branding, Packaging Strategies

Datuk Seri Abdullah Ahmad Badawi said Thursday large Malaysian companies as well as small- and medium-size enterprises (SMEs) must seriously adopt and integrate branding and packaging strategies into their business practices.

The prime minister described the two as fundamental aspects of successful businesses.

“We must work to develop the capacity of Malaysian enterprises and enable them to roll out packaging and branding of their products and services that can compete at all levels.”

Click here for the full article.

Posted by: David Oh on 11/8/2005 3:58:13 PM

Government Support And Promotion Is Key To Advancing A Nation’s Intellectual Property

In Malaysia and most parts of the world, textile designs are protected as Industrial Designs. Therefore, textile designs are valuable intellectual property.

Our First Lady, Datin Paduka Seri Endon Mahmood adopted the promotion of batik as her pet project ever since her husband took office.

This aggressive marketing of Malaysian batik worldwide is starting to worry Indonesia. A recent article published in The Jakarta Post stated the following:

Indonesian batik… has to compete with its Malaysian counterpart.

Malaysia has been actively promoting batik as a textile trademark at a variety of international fashion events. Fully supported by their government, Malaysian batik producers and designers freely and easily display and market their products.

They also try hard to patent every batik motif, many adapted from Indonesian patterns.

To make matters worse, many Indonesian batik makers are now working in Malaysian batik workshops, while, at the same time, a large number of batik factories in West, Central and East Java are now on the brink of bankruptcy because of a lack of capital, human resources and managerial and marketing skills.

Click here for the full article.

This is further evidence that proper government support can springboard a nation’s Intellectual Property into the global arena. If Malaysia is to be a serious contender in the global IP arena, there needs to be concerted effort between the public and private sector to promote our own unique IP creations.

Posted by: David Oh on 8/6/2005 3:21:41 PM

Government Assistance for Private Sector Acquisition of Technology

Finally! For the past few years, we have been preaching our former Prime Minister’s “Look East Policy” in relation to the area of Intellectual Property development.

Japan built up its technological prowess after World War 2 by importing/licensing technologies from the west. They didn’t start from scratch. They used current technology, improved on it and then sold it back to the rest of the world.

Why should we in Malaysia reinvent the wheel?

The Government is to be commended for now setting aside funds to acquire the necessary technologies for us to catch up with the developed nations.

Click Bernama: Govt Will Assist Private Sector Acquire Overseas Technologies for the full article.

Click MTDC to fund IP Acquisition for The Edge’s report.

Posted by: David Oh on 5/8/2005 4:58:35 PM

Malay Mail Online: Pirated Copies Of Potter Book Seized

Whenever I speak at IP conferences and seminars, one of the examples I use is about JK Rowling releasing her latest Harry Potter book in Malaysia only to find it pirated eventually.

How ironic now to find that it has actually happened! A store in Tesco, Puchong was raided for selling alleged bootleg copies of the latest Harry Potter and the Half-Blood Prince. Truth imitating fiction?

Click here for the full article.

Posted by: David Oh on 28/7/2005 6:14:50 PM

Businesses That Blog

The Star In Tech ran a series today about businesses that blog. There were 3 articles – New Marketing Tool, The Business of Blogging and Developing Ideas and Apps.

So, why did we at Mindvault decide to start our own blog?

Well, we’ve been providing thought leadership on Intellectual Property and Intellectual Asset Management (IAM) for a few years now and we decided that the internet remains one of the best media to convey our message.

What better way than a blog to publish your thoughts?

We also felt that it was the fastest way to inform our clients and partners of the latest happenings at Mindvault as well as the other companies within our eco-system – new developments, new solutions, new partnerships etc.

We are very proud of launching the first Intellectual Property/IAM blog in Malaysia.

Posted by: David Oh on 21/7/2005 4:17:28 PM

Star Techcentral: Pirates Well Informed, Says RIM

Informants are hampering Government efforts to close down optical-disc plants that are engaging in content piracy, said the Recording Industry Association of Malaysia (RIM).

Its chairman, Sandy Monteiro, said the plant operators would be tipped off whenever a raid was imminent and would shift the pirated products elsewhere before the authorities arrived.

“The law requires pirates to be caught in the act,” he said. “You can’t stop the tip-offs obviously, so maybe the courts could look into placing more weight on forensic evidence recovered during the raids, so that pirates can be brought to book without having to nab them red-handed.”

Click here for the full article.

Posted by: David Oh on 13/7/2005 11:39:18 PM

Rebranding A GLC: Money Well Spent?

Telekom Malaysia (now known as TM) has spent RM9 million rebranding itself. The money was spent on engaging an external branding expert, creating a new concept and designing a new brand.

Branding is more than just coming up with a new logo or spending more money on a new tagline and endless advertising. It has more to do with matching the customer experience with the brand promise. Therefore, branding is more what you do internally than externally.

Mindvault has been going through its rebranding process since March 2003. Why haven’t we come up with our new logo, colors etc yet? Because we are still working on ourselves to ensure that our external image matches our internal processes.

How do you think TM has fared with their RM9 million?

Posted by: David Oh on 7/7/2005 4:54:34 PM

The Edge Daily: Malaysia Should Improve IPR Protection, Says US

The protection of intellectual property rights (IPR) has been identified as being one of the main concerns for US investors to come into Malaysia, said the United States ambassador to Malaysia, Christopher J LaFleur.

He said a survey conducted last year of senior executives of global 1,000 firms found that 28% considered IPR protection an important factor in considering where to make new investments.

“That’s 28% of potential investors who probably will think twice before putting money in Malaysia or seeking new business partnerships here,” LaFleur said in his speech at the Federation of Malaysian Manufacturers (FMM) seminar in Kuala Lumpur on July 7 on “enhancing US-Malaysia business”.

Click here to read the full article.

Click here for Bernama’s report.

Posted by: David Oh on 7/7/2005 2:43:21 PM

International Herald Tribune: In Decisive Vote, EU Rejects Law On Software Patents

The European Parliament voted overwhelmingly on Wednesday to reject a law that would have given software common patent protection across all countries in the European Union.

The decision, by 648 votes to 14, was preceded by a fierce four-year battle between those who supported the idea that companies should be able to own software – and the inventions that use it – and those who backed the idea that software breakthroughs should be shared widely and freely. That battle will continue, though it will have to be fought separately in each of the 25 member states of the EU.

Both opponents and supporters of tougher patents in the Parliament united Wednesday to reject the bill – with supporters fearing that amendments would be added that would have undermined existing national patent protection. Opponents, meanwhile, said the law would have bolstered the market power of big companies.

Click here to read the full article.

Posted by: David Oh on 7/7/2005 10:33:53 AM

Bernama: Platform To Rebrand M’sia As New Biotech Hotbed

Malaysia is taking advantage of the Biotechnology Industry Organisation (BIO)’s annual convention here to rebrand itself as the new hotbed for biotechnology activities, said Science, Technology and Innovation Minister Datuk Seri Dr Jamaludin Jarjis on Saturday.

Jamaludin, who is leading Malaysia’s delegation of over 100 members to BIO 2005, said the crux of the rebranding is to present Malaysia’s biotechnology agenda following the unveiling of the National Biotechnology Policy (NBP) by Prime Minister Datuk Seri Abdullah Ahmad Badawi in April.

Click here for the full article.

Posted by: David Oh on 19/6/2005 4:54:30 PM


New Sunday Times Online: Intellectual Property Court Likely In Two Years

An Intellectual Property (IP) court to handle cases of infringement could be set up within the next two years.

The Domestic Trade and Consumer Affairs Ministry is lobbying hard for this, Minister Datuk Shafie Apdal said. “The court will have judges and lawyers who specialise in IP so that the rights of owners can be properly represented,” he said after his ministry’s annual meeting with the private sector here yesterday.

Click here for the full article.

Posted by: David Oh on 19/6/2005 3:46:12 PM

Bernama: Shorter Time To Register Intellectual Property

The period for registration of intellectual property will be reduced by 10 months to 48 months by the end of this year, Domestic Trade and Consumer Affairs Minister Datuk Mohd Shafie Apdal said Friday.

He said this would be achieved by beefing up the number of experienced inspectors from 42 to 100, and using external expertise, such as from Sirim.

Click here for the full article.

Posted by: David Oh on 17/6/2005 5:51:25 PM

Insights From Saudi Arabia

My 2-day conference on technology transfer in Riyadh concluded today. I was there as a speaker to share the experiences from Malaysia and in the process learned that the Saudis were very interested in what we did and how we did it since the situation in Saudi Arabia is quite similar to ours.

Intellectual Property is a relatively new subject in Saudi Arabia and not widely understood. The country is still very much a net importer of IP and is seeking ways to build local capability and capacity in various technological fields and in how to manage and exploit their IP. At the same time, they have to struggle with the lack of awareness about IP and need greater political will to push the country forward.

At this point, it occurred to me that much of Malaysia’s progress in the last decade is due to the vision and drive of our former PM, Dr. Mahathir. He helped to put Malaysia on the world stage and implanted a bold Vision 2020 for the nation. These efforts filtered down into the realm of IP since the innovations, inventions and advancement would have to be managed and exploited in order for their economic benefits to be reaped.

It seems crucial then that for developing nations to advance their national IP level, there must be leadership and a strong political will behind making IP a priority.

Posted by: John Chong on 9/5/2005 1:21:00 PM

The Star Online TechCentral: Multipronged Drive To Boost Local Intellectual Property

The concept of intellectual property (IP) is often misunderstood as being just “an obscure legal concept that is of little value in everyday life,” lamented Domestic Trade and Consumer Affairs Minister Datuk Haji Mohd Shafie Apdal on Monday.

He said the importance of IP cannot be underestimated. “IP has become one of the biggest assets for the development of any nation’s economy.

“You only have to consider for a moment the value of English teaching materials and resources across the world to recognise the wealth-creating potential of knowledge and intellectual property,” he said.

The Government, he said, is already promoting the IP regime in the country and pointed out that there is still “much work to be done” if we are to continue the development and generation of local intellectual property.

Click here for the full article.

Posted by: David Oh on 27/4/2005 2:10:00 PM

Commercializing IP At Government Level

Today, the Malaysian Intellectual Property Corporation (MyIPO) and Microsoft Malaysia jointly organised a one-day seminar on “Strategic Management of Intellectual Property Assets” in Putrajaya. This was the first module of a 10-module strategic IP management programme aimed at senior government officials and policymakers to provide a guide on key aspects of intellectual property (IP) policy and asset management.

More than 150 participants from various government ministries, universities and government-linked companies attended the seminar, which was opened by Minister of Domestic Trade and Consumer Affairs Datuk Shafie Apdal.

The thrust of the seminar was how IP, as a value driver, could enhance a nation’s competitiveness and, therefore, needs to be managed strategically in order to tap its fullest potential. The presentations by IP professionals at the event clearly demonstrated that IP could no longer be seen as just a legal instrument but as a business asset.

Mindvault, has been battling to elevate IP to business level for some years now. So, it is a relief that at least the IP professionals are speaking the lingua franca of business now.

At the seminar, the government was urged to exploit its IP in order to generate returns and to view its IT investments as revenue and not just cost centers. Some participants felt this message was too much of a challenge as the government is not a commercial entity and has traditionally not considered exploiting its assets as a means of generating new revenue streams.

Participants who did buy into this perspective expressed concern over the “how-tos” of IP commercialisation; they lamented that there was a need for working models and practical processes to monetise these assets. Sound words, indeed.

Posted by: David Oh on 25/4/2005 3:44:00 PM

Bernama: Technology Acquisition Key For M’sia’s Biotech Push, Says Jamaludin

Technology acquisition will be a crucial factor in Malaysia’s biotechnology push as the country aims to derive 4-5 percent of its gross domestic product (GDP) from the sector by 2020.

Science, Technology and Innovation Minister Datuk Seri Dr Jamaludin Jarjis today said as a relatively new player, Malaysia cannot afford to depend on organic growth to fuel its biotechnology industry.

Click here for the full article.

Posted by: David Oh on 15/4/2005 11:01:00 AM

The Mindvault Experience

The Star Online TechCentral: Ministry Moves To Get Special Court

The need for a special court to hear cases involving copyright infringement is pressing, said the Domestic Trade and Consumer Affairs Ministry.

While hundreds have been arrested and charged for the offence, most of these cases remain backlogged in the courts, said the Ministry.

Deputy Minister S. Veerasingam said the courts favour hearing high-priority cases, and those to do with intellectual property are considered a lower priority.

Click here for the full article.

Posted by: David Oh on 13/4/2005 9:34:00 AM

The Mindvault Experience

Why Can’t We All Work Together?

Today, at a conference where I was invited to speak, I met up with a speaker from one of the local universities and we got talking about how the different local universities handled their Intellectual Property. For many universities IP is a new area and they have had to (and some are still trying to) develop in house policies and processes in how to manage and commercialise their IP. Different universities are independently developing their own approach and it struck me that there was no co-ordination and co-operation between them.

Why can’t the government take the lead to have one university develop a good working approach in how to manage and commercialise their IP and then roll it out to other universities? This will result in a more consistent approach towards management and commercialisation of IP in the public universities and avoid a lot of duplication of work (if each university is to do it itself). Of course, the common approach may be tweaked by each university to best fit their institutional culture and goals.

Although there might be a sense of healthy rivalry between universities (perhaps this inhibits the co-operation?), this should be confined to the Researh & Development level. At the policy and management level relating to IP, the universities as a whole would benefit from a more unified approach rather than being fragmented as the situation now is.

Posted by: John Chong on 6/4/2005 10:43:01 AM

The Mindvault Experience

The Star Online TechCentral: Slow Patenting Process Threatens Innovation

The crawling pace of new patent registrations could affect Malaysia’s competitiveness in the global marketplace.

More than 33,000 patent applications were filed with the Malaysian Intellectual Property Corporation from 1999 to last year, but only about a quarter have to date been approved for registration.

The current situation is at odds with the huge economic opportunities that are arising from innovation and intellectual property ownership, especially in the information technology (IT) industry.

Click here for the full article.

Posted by: David Oh on 4/4/2005 6:51:45 PM


By Mindvault Sdn Bhd

Kuala Lumpur, 28 October 2004 – The recent announcement by the Ministry of Science, Technology and Innovation (MoSTI) to introduce a new Bill modelled after the United States’ Bayh-Dole Act (the Act) is seen as a positive step towards helping local scientists reap commercial benefit from their research efforts.

“This move by MoSTI signals a paradigm shift that is expected to fuel the commercialisation of government-funded R&D” said David Oh, Director of Mindvault Sdn Bhd, an Intellectual Property consulting firm specialising in the strategic management and commercialisation of intellectual assets.

“In the US, the Act allows universities and businesses to own the Intellectual Property rights in government-funded inventions for the purpose of further development and commercialisation.”

Prior to the Act, the US government was reluctant to relinquish ownership of federally- funded inventions to the inventing organisation. Without exclusive rights that come with ownership, companies were reluctant to invest in and develop new products if competitors could also acquire licenses from the government and then manufacture and sell the same products.

Following the introduction of the Act, the Association of University Technology Managers (AUTM) conducted surveys which demonstrated clear evidence of increased innovation and commercialisation activity. Analysis of the 1991 and 2000 surveys show that invention disclosures increased by 84%, new patent applications by 238%, licence agreements by 161% and royalties by more than 520%.

“Early criticism that the Act sanctioned the government to give away rights to inventions paid for by taxpayers were easily set aside because the effect of the Act was to force universities to strengthen their technology licensing policies, resulting in new jobs, new companies, tax revenues and greater economic development,” said Oh.

“We do not know whether the Malaysian version of the Act will stimulate the same follow-on effect but it is hoped that the Government will expedite its implementation and help propel the R&D environment in Malaysia to greater heights” Oh added.


By Mindvault Sdn Bhd

Kuala Lumpur, Mon – The IP Academy of Singapore and Mindvault Sdn Bhd are conducting a joint seminar on “Commercialisation of Research & Development in Universities and Public Research Organisations” in Kuala Lumpur on October 5. The seminar will be facilitated by Dr Kwa Siew Hwa, whose expertise lies in the realm of ‘technology transfer’.

Dr Kwa was the Interim Director of INTRO, the Technology Transfer Office of the National University of Singapore and was also a key advisor in the setting up of a Technology Transfer Office for the National Research Institutes in Singapore. Her seminar aims to cover the following areas: definition of research and intellectual property in universities; formation of the Technology Transfer Office; IP policies, commercialisation strategies and much more.

According to Mindvault director David Oh, Budget 2005 signals the Government’s focus on promoting commercialization of R&D by setting up a RM300 million seed capital fund to build relevant skill sets in the agriculture industry.

“Budget 2005 further alludes to the fact that researchers may finally expect to directly reap the benefits from the commercialization of their research activities – via ‘royalties’ or equity in ‘commercial vehicles’,” said Oh.

For these initiatives to succeed, “it is imperative that the appropriate structures, policies and skills are built to identify the routes to commercialization for all research and development conducted in Malaysia, regardless of industry sector”.

“We seek to learn from a seasoned practitioner such as Dr Kwa, to share with us her experiences in the area of technology transfer,” he ended.

The IP Academy sees this as “a great opportunity to cooperate with other IP educators and research institutes from around the region and we hope that participants will gain a good overview of a university’s technology transfer function”.

The seminar will be conducted on Tuesday, 5th October 2004, at Crystal Crown Hotel, Petaling Jaya from 8.30 am to 1 pm. To register, please call 6203 5070 or email [email protected].


By Mindvault Sdn Bhd

When an organization knows which intellectual property rights to protect, when to protect them and in which forms, it may well find another viable channel to profitability.

A far cry from the narrow view of protecting an author’s or creator’s claims of ownership towards their work, developments in the field have transformed IP into a valuable commercial monopoly for organizations.

How to assess and exploit value from IP for profit was the focus of a recent seminar conducted by David Oh of Mindvault Sdn Bhd, Malaysia’s current leading intellectual property consultants, jointly organized with the Technopreneur Development Flagship division of the Multimedia Development Corporation Sdn Bhd.

With over 20 software and technology companies present it was clear that the protection of IP rights has consolidated into the proper management of intellectual assets, or intellectual asset management (IAM), fast becoming an area that can no longer be ignored.

“Intellectual asset management involves the integration of business, legal and technological expertise to leverage an organisation’s intellectual assets to increase profitability and maintain competitive advantage,” said Oh.

“The measures taken to protect IP rights must be commensurate with its commercial value,” continued Oh while illustrating the IAM life cycle that enables an organisation to continually identify, assess and exploit their IP assets for profitability.

Sharon Haron, Finance Manager for Devcorp Technologies that develops Java games said that “the seminar was very interesting. I never knew that IP extends to other areas and that there were so many layers that you have to protect.”

“We are often confused by all the terminology in IP and this seminar session clarified a lot of issues. They were well-explained and expressed, the examples given were very pertinent,” said K Kuppusamy, vice-president of Pentasoft Malaysia Sdn Bhd.

Another participant, Agnes Ngiow, assistant accountant for IFCA MSC Berhad, a member of the IFCA consulting group, said the seminar title “Profiting from Intellectual Property” attracted her to participate.
“The seminar was very useful. It is quite a new topic, and I was interested to find out how to profit from IP,” said Ngiow, adding that IFCA MSC keen to know about the developments in software patenting.

Another seminar will be held again in August for TDF/MSC companies and forms part of Mindvault’s ongoing nation-building and community service to educate the ICT industry on how to leverage on their IP rights.
The seminars are also in line with TDF’s objectives, and are extended to their companies and technopreneurs as part of TDF’s enrichment programme.

“We feel that it is important for our companies and some of them have also voiced their need for it,” said Felix Kuek, Head of Lead Generation of the TDF programme/division at MDC.


By Renuka Sena
Mindvault Sdn Bhd

An edited version of this article was published on 28 June 2004 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

In today’s exceedingly competitive markets, the use and protection of Intellectual Assets is often the difference between continued success, and impending failure of a business. This is particularly seen in hi-tech companies as compared to traditional business because hi-tech companies only have minimal tangible assets but a multitude of Intangible (or intellectual) assets.

In a traditional business (e.g. manufacturing), the assets of the company generally lie in its physical assets namely its production lines and plant and machinery. Whilst these traditional businesses may also have intangible assets such as know-how, product brands and distribution/customer lists, on balance when compared to high tech companies, the assets of a traditional business primarily is reflected in its tangible/physical assets. Compare this with a hi-tech company where the assets of the company are largely reflected in knowledge and experience of management, R&D capability and intellectual property (patents, copyrights). These high-tech companies therefore have less “assets” to show in the books even though they may potentially have higher growth rates than a brick and mortar business.

In the search for capital and investment, the challenges faced by a new economy company, therefore, are numerous. Let’s face it, whether old economy or new, cash is still king. The value of either type of business stems from its ability to generate revenues. The second consideration is that the basic fundamentals of investment whether from angels, VCs or even in IPO subscriptions is for the “investor” to analyse the potential of the business to survive and generate sustained revenues.

Factors that influence investment are founded on analyses of past track record, management abilities, business models, assets (both physical and intangible) market acceptance and competitive landscape. These factors are usually analysed from a risk and rewards perspective. In today’s fast paced and competitive landscape, it has now become critical for investors to also evaluate the Intellectual Assets portfolio of a company to ascertain how these assets can increase the revenue or life-cycle of a business so as to CONTINUE TO GENERATE RETURN ON INVESTMENT.

Valuation of Intellectual Property

Most intangible assets generate premium returns for the businesses that own them, either through increase in revenues or through cost reduction. The key to utilising these assets to generate returns therefore lies in the alignment of strategies for Protection, Management and Commercialisation of these intellectual assets.

Despite the fact that Intellectual Property is increasingly bought, sold and licensed in return for revenue, valuation of IP generally attracts a degree of scepticism. This arises principally because there is doubt as to whether IP can be valued RELIABLY. This doubt has certainly held back the recognition of the value of Intellectual Assets in financial statements. In transactions where Intellectual Assets have been bought together with a business, purchasers prefer to refer to this value as “goodwill” instead of placing a value on these assets in their balance sheets.

There are many methods used to value IP but unfortunately there is a lack of global consensus as to which methods are preferred. Due to the difficulty in analysing and making forecasts of the “value” of intellectual assets, MORE THAN ONE valuation approach should be utilised. Typically the approaches used in valuation are:

  1. The Cost Approach

  2. The Market Approach

  3. The Economic Benefit Approach

When valuing IP, is it more important however to understand the factors that influence the risks associated with the IP – be it technological, market or competitive. Here therefore reliable and timely information is key.  Access to the right information will allow investors to evaluate the risks associated with the business and the ability of management to mitigate and manage these risks – thus making valuation more an “art” as opposed to “pure speculation”.

Where to Start?

An IP audit is the most cost effective solution to identifying your hidden assets. An audit allows for a systematic examination of what is owned, what is being created by employees or independent contractors, what is used and what is acquired from third parties. The audit report will assist in the evaluation of current and ongoing commercial significance of the IP assets to the companies’ present and future plans. This assessment will allow the business to focus on the commercial potential of a particular IP asset.

In addition to the above, IP audits may reveal vulnerabilities in ownership and protection of IP and therefore is useful as a risk management tool or mechanism.  Therefore it can be seen that audits are a very necessary step in a chain of related steps that will ensure that your IP asset is contributing to your company’s bottom line.

However as with the financial audit, it is advisable to conduct the IP audit with the assistance of an experienced IP specialist that not only can recognise the IP but also can put in place an Intellectual Asset Management (IAM) Plan that will assist in monitoring and commercialising these assets.

How IP can be used in commercialisation

  1. As leverage to obtain better purchase price or other benefits;

  2. To increase the valuation of a company when seeking venture capital or strategic investment. The value of a company can sometimes be many times the value of its physical assets or stock, because of the strength of its IP.

  3. Strategic partnerships can be formed between 2 companies that have complementary IP to jointly create and commercialise a better product.

  4. To block out competition in this increasingly competitive world where market share is often volatile.

  5. As security for loans from financial institutions or as collateral for debt financing.


The above issues and challenges will be dealt with in a seminar held on 1st of July 2004 by Mindvault Sdn Bhd and supported by Bursa Malaysia.  At this seminar participants will gain:

  • An understanding of differences between various forms of IP rights and how each IP contributes to the overall value of the Assets/Technology

  • Knowledge of how IP can drive earnings through commercialisation strategies

  • “Tools” that can be used to predict market penetration of new products/technologies

  • Insights on how to assess IP portfolios with the best chances of success

  • An appreciation of factors to consider when valuing IP


By Renuka Sena, John Chong, Benjamin Thompson & David Oh
Mindvault Sdn Bhd

This is the first in a two-part series published on 23 December 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

In our first article last week, we examined several areas that need to be considered when building a one-stop intellectual property (IP) infrastructure, namely, IP information resources, IP enforcement, IP marketplaces and IP registration. This week, we look at training, commercialisation and funding.

IP Training

While IP is becoming a more popular topic at seminars and conferences, overall, the approach is too fragmented and very often targets the legal community. To fully equip people with IP knowledge, a more structured and long-term approach is required. While an IP training centre already exists and IP is being taught as a subject to law students in universities, there is a need to set up an institute dedicated to IP. This could serve potentially as a one-stop training agency.

For such an institute, training should not only be aimed at the traditional recipients – IP examiners at the Intellectual Property Corporation of Malaysia, enforcement officials and the judiciary – but also at creating a pool of specialist patent drafters. The latter need not have legal training or be legally qualified because the skill set required is more technical or scientific in nature.

A patent drafter would be required to understand the field of invention and articulate the novel and inventive characteristics of the invention to ensure that successful registration of the patent is achieved. As such, patent drafters traditionally have science, engineering and, in recent times, information and communications technology (ICT) backgrounds.

Currently, tens of thousands (if not more) of ringgit flow through our borders into countries like the UK, the US, Australia and Singapore to obtain the services of specialist patent drafters. Such expertise does not exist in Malaysia but there is no reason why it cannot. Perhaps, the relevant authorities should consider IP training for ICT or science graduates as an alternative to traditional job prospects. IP training may even be offered to our existing pool of unemployed science or engineering undergraduates who can, as a start, understudy foreign experts providing such services to legal firms. This will ensure new skills and job opportunities are created and reduce the amount of ringgit flowing abroad for such services.

IP Commercialisation and Funding

In Malaysia, it is difficult to separate funding from commercialisation and as such, we have decided to consider them together. The government has sought to set up an enabling infrastructure to spur research and development (R&D) via venture capital funds from Malaysia Venture Capital Bhd and Malaysia Technology Development Corporation, and government grants from the Multimedia Super Corridor’s R&D Grant Scheme; Intensification of Research in Priority Areas; Industry R&D Grant Scheme; Commercialisation of R&D Fund; and, more recently, Strategic ICT Thrust Areas.

However, government-funded R&D has no commercial thrust, as recent articles [email protected] show. One article reveals that of the 5,232 R&D projects implemented under the Sixth and Seventh Malaysia plans, only 5.1% were commercialised – an appalling figure since these projects were funded with public monies.

In response, the government has made Sirim Bhd the agent to match industry and market needs, although it is unknown at this juncture what model Sirim will adopt. In addition to this, the government has offered remedies, such as tax exemptions for income received by researchers and waiver of fees for filing patents.

Many other challenges have been highlighted by the [email protected] team, such as:

  • The lack of pre-seed and seed stage money;

  • Expanding existing programmes to encourage more collaboration between government-funded research and industry; and

  • Harmonising national IP management with the setting-up of a one-stop agency within the Ministry of Science, Technology and Environment, namely, the National Innovation Centre.

In addition to reports on the lack of commercial focus at universities, there has been an ongoing tennis match between venture capitalists (VCs) and technopreneurs with regard to “commercialisable” business plans. VCs say the quality of business plans that are submitted for funding are below par while technopreneurs lament that the VCs are risk-averse.

So what does all this mean? Commercialisation of IP (which is usually the end product of R&D), put simply, is about planning how you will take your good idea to the marketplace. It involves working your idea into your business plan, consideration of protection options and determination of how to market and distribute the end product.

As practitioners who champion the importance of commercialising IP, it seems to us that before we forge ahead, we should take a couple of steps back and examine why we are facing the challenges that have been much publicised recently. Malaysia is said to be a nation in a hurry but perhaps in our haste to become a developed nation, we are forgetting some basic requirements that need to be met first.

For example, do we have an enabling infrastructure that supports the growth of technopreneurs and entrepreneurs in Malaysia? Does our education and business culture encourage innovation among students and employees? Is there ready access to market and industry research and statistical data that can assist entrepreneurs and researchers make informed and calculated decisions prior to undertaking R&D projects? Do inventors and researchers understand that protection of IP prior to publication can result in numerous sources of income via a multitude of channels, such as licensing, assignments, joint ventures, strategic alliances and technology pooling?

In a study conducted by the Organisation for Economic Cooperation and Development, it was revealed that across its member countries, laws and policies governing ownership of IP generated with public research funds are being re-examined. However, even with such changes, it can be seen that although legal instruments are important, a change in culture and mindset is imperative.

What steps can we take to bring about such changes in mindset and culture to ensure that the nation benefits economically and socially from R&D and commercialisation? For one, we should consider the setting-up of institutions that can nurture young firms and budding entrepreneurs to help them survive and grow during the seed and start-up stage when they are most vulnerable. Such institutions could take the form of incubators, technology transfer offices or collaborative research centres (CRCs) as in the US, the UK and Australia.

To provide an enabling infrastructure, the following should be considered:

  • Establishment of CRCs or institutions between the government, the business community and educational institutes in targeted industry sectors. At present, R&D appears to be conducted in silos, with no pooling of resources, both financial and human, to undertake focused research in industry sectors. Such focused research requires input from the private sector and the expertise and infrastructure of universities to create research data/findings, which can then be utilised to produce end products ready for commercialisation.

  • Formation of inter-disciplinary teams. The success of such CRCs requires a myriad of skills and disciplines. It is suggested that the CRCs recruit or encourage secondments from universities and the business community to form two related but distinct teams that focus on R&D and commercialisation, respectively. The R&D team would require multi-disciplinary science and technology teams, marketing experts and IP practitioners. The commercialisation team would provide advice and assistance in relation to new business formation, capital development, technology transfer, access to industry and market research as well as provide hands-on management assistance.

  • Clear guidelines and policies. For all parties in such ventures to benefit or to be encouraged to come together, there must be clear guidelines that equally reward researchers, the private sector and the CRC. Such guidelines should rule that ownership and commercialisation of IP resulting from CRC research be owned by the CRC. However, to benefit all parties involved, there can be guidelines regulating floor and ceiling percentage returns via royalty or equity shares (depending on how the R&D is intended to be commercialised) to researchers, the private sector and universities and the CRC, reflecting efforts/resources contributed by all parties.

  • Access to critical research and data. At present, while the Internet does, to some extent, provide limitless research potential, access to industry-focused market research, global trends and statistical data regarding, for example, purchase patterns within customer segments is only available to those who can afford to commission research houses. Therefore, all such industry related/focused data should be commissioned or aggregated (from other available sources like Malaysia External Trade Development Corporation) by CRCs and compiled into databases that can be provided to budding entrepreneurs and the business community at an affordable cost.

  • Developmental funding and the creation of a complete and integrated funding value chain. It is a known fact in Malaysia that we do not have a vibrant angel network to provide pre-seed or seed funding, which is critical to create early-stage idea formation and prototypes, and generally provide access to industry networks. The CRCs may be well placed to provide such “institutional angel funds” and provide a strong business-building environment, especially at the seed stage, considering that the bulk of Malaysian entrepreneurs is in this stage.

  • Grants, financing schemes or incentive schemes for IP. While there are government grants that allow for IP-related expenses like patent and trademark searches and filing in overseas countries, such funds do not adequately meet the funding needs of budding inventors or entrepreneurs in terms of quantum and timing. Inventors or researchers need data on patents filed overseas in the early stages of R&D to determine whether to continue to focus R&D in the selected field or abandon R&D because of lack of commercial potential (because there is an existing third-party patent right).
    Although some foreign databases allow free access and search facilities, this in itself is not the stumbling block. An unskilled person reviewing search results may not be able to accurately establish whether or how to design around patents or whether his R&D would be infringing a third-party right. This requires the expertise of specialist IP practitioners, but the fact is those inventors and entrepreneurs rarely have the funds to pay for such services. As such, the usual modus operandi would be to defer such services until seed or grant funds are obtained to finance such services. By then, it may well be too late and the inventor (and investor) may find that his IP right has been compromised.
    It is ironic that funds are available to finance foreign IP registration but no incentives of financing are available for the inventor to draft and file local patent applications. It is suggested therefore that funds are made available to carry out such activities if the nation is to benefit from a local IP pool.

Perhaps the first task of the CRC (or any other institution identified to conduct the exercise) would be to review the 5,232 R&D projects that have been funded and ascertain why they were not commercialised. It may be necessary to rescue some of these now “orphaned” R&D by bringing in experts from unrelated industries to see if new uses may be identified. One way of doing this would be to set up a closed R&D marketplace and invite subscribers or local/foreign corporations to assess and evaluate R&D findings that may be beneficial to them.

A recent [email protected] article, entitled “Strategic Roadmap for Universities”, highlighted possible solutions to the problems faced by universities in commercialising R&D. A study should perhaps be conducted to ascertain what incentives or policy changes would stimulate the private sector’s collaborative involvement with the universities.


Early this year, there was a debate on whether we should continue to adhere to the “Look East” policy established by Tun Dr Mahathir Mohamad. An area that was not addressed was Malaysia’s failure to “look east” at the development of the IP arena. Japan, whose economy was destroyed by World War II, rebuilt itself into an industrial giant because it learnt to exploit the IP right (known as industrial property rights in Japan) system to its advantage.

Why can’t Malaysia do the same? If there is enough political clout and industry commitment to deal with the issues raised in this article, “Made in Malaysia” will soon become a catch phrase of innovation and quality for the rest of the world.


By Renuka Sena, John Chong, Benjamin Thompson & David Oh
Mindvault Sdn Bhd

This is the first in a two-part series published on 15 December 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

It is encouraging to see the increasing number of articles and issues being raised about intellectual property (IP) in the media. A few weeks ago, there was even a call for a “one-stop shop” to enable entrepreneurs to fully protect their works. To an IP practitioner, the idea of a one-stop shop in Malaysia begs the question: Are Malaysians ready for one? And if so, what is the mandate that will be given to this body or agency for it to fulfil the needs of our local IP inventors and creators?

Current approaches to IP in Malaysia focus primarily on legal aspects, for example the introduction of cyberlaws, amendments to existing IP legislation, increased anti-piracy activities and the formation of the Malaysian Intellectual Property Corporation (MIPC).

In order for Malaysia to fully embrace the knowledge economy and to create a vibrant and sustainable environment for the creation of knowledge assets and workers, an integrated IP system needs to be built. By this, we mean a centre where the many different aspects of and provisions for IP are present, of which law and protection make up only one component of the whole infrastructure.

Let us consider what it would take for Malaysia as a nation to create such an infrastructure that will eventually lead to the formation of an integrated and comprehensive one-stop shop.

IP Information Resource

With the advent of the Internet, there are numerous websites that can be accessed to obtain information on the various types of IP. Type “intellectual property” on Google and literally hundreds of links can be accessed. But let’s face it, the reality is that many of these sites are foreign-based and to the uninitiated, this information overload results in confusion as opposed to enlightenment.

It would certainly be beneficial to all Malaysians and foreigners seeking information on Malaysian IP if there was an official website or portal on Malaysian IP laws, local initiatives and service providers and so on.

IP Enforcement

Recently, in response to a survey conducted by the Malaysia Venture Capital Management Bhd (Mavcap)-inititated Cradle Investment Programme (CIP), one of the major concerns that was raised by potential applicants to the fund was the safety of their ideas. The apprehension was that potential applicants were afraid to submit their ideas for fear that they would be hijacked. Why is this an issue? Are we a society of hijackers and thieves? Perhaps the answer can best be articulated in this sentence which was sent around on Merdeka Day in a blog entry entitled “We are We” where the author said, “We condemn the drug addict who stole our RM2 slippers but it’s okay when we steal other people’s intellectual properties”.

This sums up the general attitude towards IP – we want others to respect our IP but we don’t respect the IP of others. Something has to give and in order to create an environment of mutual respect and protection of IP, we as a society need to foster mutual recognition and respect for IP.

A report published by the New Economic Impact Study on April 3 states that “strong IP protection spurs creativity which opens up new opportunities for businesses. When local entrepreneurs have a legitimate way to sell their innovations, they can grow their businesses and hire more people. This in turn drives up spending in the local economy and increases tax revenues to help fund public services”. As such, it can be seen that an effective enforcement regime does not only ensure protection of our intellectual assets but is a crucial step towards economic benefit to all.

So how do we create such an environment? It is suggested that a one-stop enforcement centre be set up, which would have, among others, the following features:

  • Information pertaining to the enforcement of IP rights in both the civil and criminal jurisdictions;

  • Database of service providers for civil enforcement;

  • Online and offline receipt of complaints and information pertaining to IP infringement;

  • Simplified procedures for criminal enforcement including a unified system that is implemented nationwide; and

  • A specialised dispute-resolution tribunal that is not only well-versed in the law but also the technical aspects of IP.

This centre would be the first port of call for all complaints on IP infringement and would manage the entire enforcement process. The centre would also spearhead a nationwide awareness campaign to foster a greater understanding of IP rights protection, conduct specialised skills training for local enforcement, police and customs officials and finally monitor administrative, civil and criminal sanctions in the courts.

IP Marketplace

More than 80% of the worth of most New Economy companies comprise of intangible intellectual assets, Hence IP is known as the new asset of the New Economy. However, what is the use of an asset if it cannot be exploited? After all, IP assets are created for commercial purposes: to produce multiple revenue streams for the company.

In order for an asset to be fully exploited, it must be a liquid asset. In other words, it must be easily disposed off or at least its full revenue potential must be easily realised. For example, if a company would like to use its IP as collateral for a loan, the financial institution can only accept such a collateral if it can easily liquidate the IP in the event the company defaults on the loan. Otherwise, the financial institution would be left with a paper asset with no realisable value and thereby cannot recoup its losses.

IP marketplaces have sprouted all over the globe to provide a forum where IP can be listed, bought, sold, auctioned and licensed. Some of these marketplaces focus on specific IP rights like patents or on specific fields like biotechnology and semiconductors. Other marketplaces list IP from specific sources like universities and public research organisations. There are also region-specific IP marketplaces like in Japan and South Korea.

Malaysia needs its own IP marketplace if it wants to extract maximum value from its innovations. This marketplace should be a one-stop forum which includes the following features, and more:

  • A listing of all local IP that is available for sale or licence;

  • A place where companies can list IP that they need;

  • Introductions to a panel of accredited expert service providers to assist in the commercialising of IP; and

  • Linkages with other IP marketplaces to ensure exposure of Malaysian IP to the rest of the world.

The use of this marketplace should be priced competitively to ensure that it is accessible to not only the large companies with means but also to the cash-strapped individual inventor and even innovative students in schools and universities. It should be a place where Malaysians can also share ideas to further their research and development in creating more indigenous IP and pool their resources to create world-class IP.

IP Registration

Like most countries, Malaysia has a central agency – the MIPC – responsible for the registration of IP rights. Where registration is concerned, its role is to receive the applications filed by the public, examine whether such applications comply with and are acceptable according to the law, formalise the registration documents (where granted) and maintain the records and renewals. However, registration involves more than just the foregoing and much more preliminary work needs to be done before the application is submitted, such as:

  • Giving advice on what form of IP should be applied for. Many people do not understand the difference between patents, trade marks and industrial designs and need help in knowing what they have and what type of application they should submit;

  • Searching for prior rights. IP is such that if someone else has earlier applied for or registered something similar, this will negatively impact your own application. Many people do not realise this nor do they realise that they are able to search for such prior rights before they spend their time and money in making their application; and

  • Preparing the documents for submission. Like all official applications, there is a level of complexity in completing the forms and knowing what to fill up or insert. Incorrect or insufficient documentation can result in the application being rejected or even if granted could result in lesser protection being granted than expected.

Traditionally, the MIPC does not deal with pre-application matters such as the above and the public is required to seek the help of IP professionals, who are few and mainly concentrated in the Klang Valley. The idea behind a one-stop registration agency is a place that can handle all matters relating to IP registration from the pre-application to post-application matters.

As can be seen, the construction of a single one-stop shop which integrates all of the above requires the concerted efforts and contribution of various government and private sector bodies. Despite the mammoth task, the demand for such an integrated infrastructure is one that we very much need if we are to transition to the k-economy gracefully. In the next instalment, we will consider the challenges faced in the commercialisation of IP, consolidated training in IP and the need for government funding for IP-focused initiatives.


By Renuka Sena
Intellectual Property Consultant and Director
Mindvault Sdn Bhd

This is the final in a four-part series published on 21 July 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

Knowledge is the currency of the future. In today’s exceedingly competitive markets, the use and protection of intellectual property (IP) is often the difference between continued success or impending failure of a business. This is true of high-tech, low-tech and even no-tech industries. Making strategic use of IP as a competitive differentiator is now a financial necessity.

We have finally arrived at the last leg of our journey. Having audited, analysed and protected your strategic IP assets, you can now finally get down to the business of making money. It is at this point that we can explore how to achieve spectacular financial results with IP.

The Strategy

There are several distinct strategies to leverage on IP but we will only focus on three:

  • Utilising IP at the core of business strategy;

  • Value partnering; and

  • Licensing out of non-core IP.

In devising an IP strategy, a company may use any one or any combination of all of the above strategies. In deciding which strategy to execute, it is imperative to integrate or align the above strategies with your business plans.

IP as the Core Business Driver

Traditionally, the role of IP has been to assist in innovation or to enhance product or service offerings. IP therefore forms the core of research and development (R&D) efforts to create new or cutting-edge technologies in order to effectively compete against other players in the market. This could take the form of enhanced formulas which will achieve better results as exemplified in the detergent or oil and gas industries; creation of more efficient processes or software that can deliver on better service levels as seen in the manufacturing and information technology sectors, or even the discovery and patenting of novel drug targets as demonstrated in the pharmaceutical industries.

Use of IP in this way is usually coupled with strategic protection mechanisms for brands or patents and hence forms a strategy that is built around a company’s core competency. However, as industries evolve and consumers become more savvy, this strategy necessarily involves allocating vast sums of money to R&D and branding budgets in order to remain competitive.

It is not always the superior technology or product that captures the highest market share. Sometimes, it is the less than superior product with an ingenious marketing strategy that wins. Many companies are beginning to realise that using IP purely in this manner does not always translate into sustainable business models.

Enter, Value Partnering

As industries merge and products and services become more competitive, the race for the consumer dollar is an increasingly difficult one to run. Whilst it would be ideal if we were able to conquer global markets purely from business expansion, this is not always the best or quickest method of growth.

Strategic partnerships and alliances have long been used as a means to capture and leverage on individual strengths. However, this trend is evolving into more dynamic structures where IP is used as a tool to deliver new products or services or to reach new markets with existing technology whilst simultaneously optimising revenue from IP.

Licensing is a proven model for achieving market penetration and yet this strategy is surprisingly not widely exploited by local IP owners. Perhaps what is not widely understood is that IP rights are territorial in nature and the IP owner can therefore maximise return on investment by structuring licensing or other equally beneficial arrangements with various parties for the same IP. This is exemplified in technology transfer, cross-licensing, franchising and even industry consolidation via mergers and acquisitions. Decisions on methods and the extent of licensing transactions very much depend on business strategy, and vary from company to company.

Obtaining Revenue from Non-core Assets

An alternative but less-utilised model can be seen in the licensing of non-core IP. As market requirements and competitive dynamics in industries change, companies often evolve their business strategy in order to remain competitive. These decisions sometimes lead to abandonment of IP — resulting in a body of non-core IP.

Another source of non-core IP comes from R&D efforts. The process of R&D often leads to innovations with valuable applications in industries that are not directly related to the company’s core business. These innovations are sometimes protected but more likely written-off.

Whether the decision is to abandon IP that is no longer utilised or to write off innovations that do not contribute directly to core business, the fact of the matter is that resources have already been spent on IP. Would it not make better financial sense to leverage on these pools of non-core IP to generate passive income?

Perhaps this concept is best explained with an example. Procter & Gamble owned a molecule called “Olestra” which was hailed as a low-fat ingredient for snack foods. But unpleasant side effects (since corrected) caused sales to fall flat. Instead of being stuck with a multimillion-dollar plant equipped to produce the molecule, Procter & Gamble sought another application for it – environmental remediation: poured on contaminated soil or sludge, the Olestra molecule binds itself to pollutants, which can then be removed easily. Thanks to these alternative applications, Procter & Gamble has salvaged its investment in research and infrastructure.i

The Value of IP

We hope that this 4 part series has given you an insight as to the value of IP and an understanding that effective safeguarding of your IP and innovations through the various means of protection and actively managing the resulting portfolio can lead to significant new revenue streams, strategic market advantages and increased shareholder value. Overlook these assets and you run the risk of being shut out of developing markets, losing previous market share and undermining your R&D efforts – whilst your competitors strategically build barriers around key technologies. Who the winners and losers of the impending global marketplace are will depend on who has the best IP strategies.



i Sourced from “The McKinsey Quarterly, 2002 Number 4 Technology” by Jeffrey J. Elton, Baiju R. Shah, and John N. Voyzey.

Lastest News! On 1 August 2003, it was announced that the Food & Drug Administration (FDA) will no longer require companies that sell snacks and other foods containingOlestra to warn that it can cause gastrointestinal distress (


By John Chong
Intellectual Property Consultant and Director
Mindvault Sdn Bhd

This is the third in a four-part series published on 14 July 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

The road to managing a company’s intellectual property (IP) as a strategic asset begins with identifying, analysing and understanding those assets which can be classified and utilised as intellectual property, which was the subject of last week’s article. The next step is to protect them and this usually begins with the process of registration.


In Malaysia and most other countries there are statutory mechanisms to register intellectual property. The purpose of registration is to formalize the company’s legal rights over the intellectual property. Just as a homebuyer lays claim to his house by registering his name on the land title, a company can lay claim to its IP by registering them. Without a registration, a company’s claim over a piece of intellectual property may be disputed, as Microsoft found out in 1995.

In December 2002, reported that Internet Explorer held 95% of the global browser market share. For a browser that is now found in millions of personal computers and notebooks around the world, it is surprising to know that the name Internet Explorer did not originally belong to Microsoft – it was the property of a small internet company called SyNet, who had applied to register the name Internet Explorer as a trade mark earlier. In 1995 SyNet sued Microsoft over the latter’s use of Internet Explorer for its browser but the case was settled in 1998 when Microsoft paid US$5 million to end the suit and take over the name. SyNet’s trade mark registration for Internet Explorer was a key factor in its favour.

Trade marks are just one main form of IP that may be registered, the other main ones being patents and industrial designs. The rules and procedures for the registration of trade marks, patents and industrial designs are different and too involved to be contained in this article, but several general issues should be borne in mind:

  • Registration is typically country specific. For example, if you perform a registration in Malaysia then your rights only cover Malaysia. To protect your rights in another country you must register there also. While there are some treaties (such as the PCT and Madrid Protocol) which enable multinational registrations, Malaysia is not part of them yet

  • Registration costs money and overseas ones more so. The company ought to have a budget set aside for registration and more importantly, an action plan to ensure that the right intellectual property are selected for registration, that the registrations are managed properly and within the budget.

Registration Action Plan

Many Malaysian companies approach intellectual property registration in a haphazard manner, which may result in: IP not being registered in the right places, the wrong IP being registered, the right IP not being registered, etc. In order to maximize the results of a registration exercise, the company should work on a registration action plan that should include among other things:

  1. A listing of all IP owned by the company (an IP audit will reveal this). This list should classify the IP into categories of importance; those which are most important (the so-called Strategic IP) should be registered first and registered in all the countries where the company will exploit the IP.

  2. Rationale for registration – why do you want to register that particular IP? Registration is typically used to protect a company’s IP assets and revenue stream by making that IP exclusive to the company. However, some companies may use IP in a more aggressive manner, e.g. to block a competitor’s technology development, or to gain business leverage to negotiate with bigger companies.

  3. A cost benefit analysis – is the cost of registration and maintenance of that registration justified by the commercial returns from that IP? Revenue forecasts for the IP should be compared against the registration costs.

  4. An obsolescence analysis – seeing that the registration process can take years, the lifecyle of the IP ought to at least outlast the time it takes to obtain the certificate of registration. For example: in the textile industry, it is not feasible to register every textile design when the customer trends change in the short term, and by the time the registration is completed the design may be out of fashion. That is, unless you have a classic design which survives for many years.

  5. Roll out strategy – the decision on where to register should be linked to the company’s export and expansion plans. Registration should be effected first in those countries where the company is going to export to shortly and in the major economies.

Protection Without Registration

While registration plays an important role in protecting your intellectual property, there are some situations where protection can exist or should exist without registration. A classic example is in the food & beverage industry, where recipes are jealously guarded and may be handed down a family for generations. The Coca

Cola formula, which has remained a trade secret for over a century, is one of the best known cases.
The decision on whether to keep something a trade secret usually depends on how well the secret can be kept. If the product can be easily ‘black-boxed’ and difficult to reverse-engineer, you may be better off keeping it a secret rather than apply for a patent over it (assuming it is patentable) and disclosing the product to the world.

The second major example of IP protection without registration is copyright. Copyright is one form of IP that exists without registration, yet it is an important and valuable right especially in the software and entertainment industries. Because there is no registry for copyright works, the method of claiming copyright ownership in Malaysia is usually by way of a statutory declaration.

Protecting your IP can be a complex issue, yet it is a vital early step in the entire chain of managing your IP. The next instalment will progress onto the issue of commercializing and making money from intellectual property.


By David Oh
Intellectual Property Consultant and Director
Mindvault Sdn Bhd

This is the second in a four-part series published on 7 July 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

Hidden treasure worth US$100 million discovered!

You might be wondering which lucky guy armed with a metal detector and shovel this headline is referring to. Actually, it is referring to The Dow Chemical Company, a Fortune 500 company.

In 1992, Dow Chemical conducted a “treasure hunt” which uncovered intellectual assets that eventually produced more than US$100 million in licensing revenues for the company. Furthermore, strategic decisions undertaken by the company’s management led to additional savings of more than US$50 million in taxes and fees.i

Buried Treasure

Many companies have treasure buried within the crevices of their business that are yet to be discovered. This buried treasure is the company’s intellectual property (IP) or intellectual assets, as it is often referred to today.

In Malaysia, there are five major categories of IP rights:

  • Trademarks/brands;
  • Copyright;
  • Patents/inventions;
  • Industrial designs; and
  • Trade secrets/confidential information

There are also other IP rights such as geographical indications and layout designs of integrated circuits.

Last week, the concept of managing IP as a strategic asset was introduced. In order for top management to do this, it needs to know what IP resides throughout the organisation. Without a knowledge of their IP and the various businesses and market segments it relates to, management cannot decide on the appropriate strategies to unleash their value.

Intellectual Property Audit

The IP “treasure hunt” is more correctly referred to as an IP audit. This is an internal review of the organisation to determine the IP environment in order to define its IP portfolio.

Do not be fooled by the word “audit”. The IP audit is more than a legal exercise, such as those undertaken for due diligence purposes. It is also more than just a stocktake of a company’s IP assets.

The IP audit is undertaken for strategic commercial purposes and is therefore a task that involves expertise from the business, technical and legal fields. The end result of the audit is to provide management with a snapshot of the organisation’s IP — showing its commercial value and competitive use in relation to the company’s business. This information is essential if the company’s IP is to be managed strategically.

In the example mentioned earlier, Dow Chemical actually conducted an audit of its 30,000 patents. From the information collated, Dow’s management was able to classify the patents into three categories — core patents it would maintain, non-core patents it would license out and non-core patents that it would abandon.ii

It was the licensing of non-core patents that led to Dow’s patent licensing revenues to skyrocket from US$25 million to more than US$125 million and the abandonment of non-core patents that resulted in savings of more than US$50 million in taxes and maintenance fees.

Treasure Map

The IP audit plan is like a treasure map where “X” marks the spot of the buried treasure. Hopefully, management will not only discover one “X” but many “X’s” marking out numerous intangible assets peppered throughout the organisation.

Without delving into the precise methodology of an IP audit, an effective audit should have the following elements:

  • Catalogue all known and uncover all unknown IP to answer the following two questions — is my IP adequately protected? And is there IP that I have failed to recognise and protect?;

  • Determine the scope, strength and vulnerabilities in those rights;
    Value the IP;

  • Classify the IP according to its business use, product categories and market segments indicating its competitive significance;

  • List IP which may be of value to other business units in the organisation or to strategic partners in the value chain such as distributors and suppliers;

  • Map out the IP that have been commercialised, detailing the form of commercialisation such as licensing as well as its business life cycle; and

  • Collate and review all IP-related company policies.

As can be seen, there are actually two major stages in this audit. Firstly, the IP assets have to be identified. Thereafter, those assets have to be analysed, bearing in mind that the purpose of such an exercise is to eventually formulate strategies to extract maximum value from them.

Strategic Action Plan

Knowing the scope of ownership of IP and the role these assets play in the marketplace is critical to success. IP audits provide that knowledge. Management will then be able to develop and implement internal or market-based strategies to realise the commercial value.

The resulting IP portfolio should provide a clear picture of the following:

  • Strategic IP that gives the business a competitive edge and which can be used for competitive purposes;

  • Valuable IP which is not part of the company’s plans but can be commercialised through licensing; and

  • IP that is not part of the company’s present or future plans that can be abandoned.

With the current emphasis on good corporate governance, an effective audit also has the added advantage of contributing to risk management. It is recommended that the audit be conducted periodically, preferably annually. With the completion of this stage in the management process, the next two stages of protection and commercialisation can be undertaken more effectively. These next two stages will be covered in greater detail in the next two articles.



i See Rivette & Kline, Rembrandts in the Attic: Unlocking the Hidden Value of Patents; Harvard Business School Press 1999

ii See Fitzsimmons & Jones, Managing Intellectual Property, Capstone Publishing 2002


By David Oh
Intellectual Property Consultant and Director
Mindvault Sdn Bhd

This is the first in a four-part series published on 30 June 2003 in the [email protected] pullout of The Edge, Malaysia’s leading Business & Investment Weekly.

Would you like to earn US$35 million in a single day? Could your company do with a multi-million dollar cash injection?

This is what happened to MercExchange LLC on May 27 when a US Federal Jury ordered online auction giant eBay to pay US$35 million in damages for the infringement of two patents held by MercExchangei.

Who is MercExchange? Is it a manufacturing company? Does it own plant and machinery? Does it have a large workforce

MercExchangeii is a company owned by Thomas Woolston, an inventor and patent attorney, whose main source of income is derived from the licensing of patents owned by Woolston.

MercExchange does not sell any tangible products, it does not own any distribution channels nor does it have many employees and yet, it is now US$35 million richer. Welcome to the knowledge economy.

The New Economy

The advent of globalisation and the k-economy has changed the playing field, bringing with it a new set of rules and perspectives.

In the old economy, assets were traditionally defined as something tangible like inventory, plant and machinery or property. Eventually, companies included human resources in its classification of assets.

However, the New Economy has changed the definition of assets. Assets no longer have to be tangible; in fact, intangible intellectual assets are what made some of the world’s richest and most powerful companies what they are.

For example, last year, General Electric had a market cap of nearly US$400 billion and tangible assets of less than US$40 billion, Microsoft had a market cap approaching US$300 billion and tangible assets of less than US$5 billion, and Pfizer had a market cap of approximately US$260 billion and tangible assets of less than US$10 billion.iii

The Malaysian Landscape

Ideas, innovation and knowledge have become the new currency of the k-economy. As such, Malaysian companies can no longer protect their market share and maintain their competitive edge with old economy strategies.

Unfortunately, in Malaysia, intellectual property (IP) is often viewed as nothing more than a legal instrument. When we think of intellectual property, we think of falling afoul of the law. Images of enforcement officers raiding illegal VCD outlets spring to mind. We start to worry about the pirated software that sits in our office computer. Hence, we miss out on the strategic and commercial value of IP.

Strategic Paradigm

Michael Porter, a leading strategy thought leader who was recently in KL, says companies must compete in order to achieve sustainability and that in order to compete, they must have a strategy.

What many fail to realise is that intellectual property is a strategic asset that will distinguish companies in today’s globalised k-economy if it is managed with the right paradigm.

We need to move from asking, “Must I register my trademark?” to “Now that I’ve registered my trademark, how do I build it into a world-class brand?”

The question “Should I patent my technology?” is not as important as “How can I fully exploit and commercialise my innovation in order to generate maximum returns for the company?”

These are strategic concerns that must be addressed by top-level management and not delegated to the legal department, the research and development (R&D) team or the sales and marketing division.

As last week’s cover story in [email protected] on Spektra Planet highlighted, legal advice alone may be insufficient in guiding a company in its quest to become a successful business. Dr Naim Yunus, an entrepreneur and venture capitalist was quoted as saying, “Spektra should engage a strategist to plot the commercialisation and product road-mapping of SP4D [Spektra’s virtual reality software] and also get someone to advise them on IP management and protection”.

This strategic approach is known as Intellectual Asset Management (IAM), and involves the integration of business, legal and technological expertise to leverage an organisation’s IP to increase profitability and maintain a competitive advantage. When utilised strategically, IP can contribute to the competitive edge of a company such as erecting high barriers to entry and providing a unique value proposition as well as market differentiation.

Changing Mind-sets

There is a great need for Malaysian manufacturers to break the original equipment manufacturer-mindset. With emerging economies like China providing cheap labour and low-cost manufacturing, how can Malaysian companies remain competitive and hold on to their market share without developing their own proprietary innovations and brand names?

If price becomes the sole distinguishing factor in differentiating these companies, eventually their margins will be squeezed by price-shoppers, which will lead to their eventual demise.

Take IBM as an example of how to strategically manage IP. IBM recognises that its most important asset is its IP portfolio. It registered more than 3,000 patents last year, many of which it does not even utilise but rather, licenses out. In the last 10 years, IBM has generated approximately US$10 billion through licensing alone!iv

This income is free of manufacturing or significant operating costs, meaning that it is virtually free cash flow that goes straight to IBM’s bottom line as profit.

IP Management Road Map

So where do we go from here? There are three stages that companies should consider in managing their IP.

The first stage is the identification/analysis stage. At this stage, the company conducts an IP audit in order to identify and classify its IP portfolio.

The second stage is the protection stage. Once the IP has been identified and classified, the company ought to develop a protection strategy (be it offensive or defensive).

The third stage is the commercialisation stage. As discussed above, the purpose of having IP is for it to make money for the company. The important thing is for the company to treat IP as an asset where a return of investment is expected.

The road to changing mind-sets in Corporate Malaysia seems like a long and winding one but it is a journey that we must take if Malaysia is to succeed in today’s globalised k-economy.


By John Chong
Intellectual Property Consultant and Director
Mindvault Sdn Bhd

This article was published in April 2001 in The Star, Malaysia’s leading daily newspaper.

The K-Economy has received much attention in the Third Outline Perspective Plan (OPP3) and in recent press and events. There is substantial political will behind a move towards the K-Economy. To make it a reality though will require more than political motivation; it will demand considerable development and investment in all aspects of the national infrastructure.

While the shortcomings of the current physical infrastructure are often highlighted, what is often not mentioned is the dearth of significant intellectual property (IP) in this country. The wealth of the K-Economy lies in IP and its creation, protection, management and exploitation must be a priority for countries and businesses that wish to advance into and reap the benefits of a K-Economy.

The largest economies in the world have a lot of their wealth and influence tied up in IP. Think of the most valuable brands in the world (like Coca-Cola, ranked no.1 by Interbrand and worth US$72.5 billion), whose pull affects consumer spending decisions around the world. Think of where the latest technologies come from, technologies that impact the way we live and work. Think of who conducts cutting edge research and development, the people and companies who will continue to chart the course of commerce in future. And you will think of the first world nations. They are first for a variety of reasons, one of the most important being leadership in the field of IP.

What is IP? In basic terms IP represents creations of the intellect, be they products or services, inventions or discoveries, tangible or intangible. IP can take an incredible array of forms – brands, software, consumer goods, content, art, music, film, etc. – and can be found in virtually any industry – food, entertainment, fashion, biotechnology, information technology, manufacturing, pharmaceuticals, media, etc.

IP has been and is under-developed in Malaysia. There are too many ‘me too’ products and not enough distinctiveness and innovation. In some cases, good ideas have not been commercialized successfully. Rather than command a premium for quality and uniqueness, many companies compete on price with fairly generic products. With places like China looming large on the economic front and other Indochina countries in the shadows, competing on price alone can be disadvantageous. Hence companies must harness the power of IP, a process which involves 4 steps: Create, Protect, Manage and Exploit.

Creation of IP is the most fundamental step. It should be part of the corporate vision and be supported by the commitment of corporate time, manpower and resources towards the creative function. The strength of the human resource is critical, each division should be staffed with the right talent – researchers for product development, designers for product aesthetics, marketers for product branding and the like. Each of these divisions generates their own IP and contributes towards the overall IP portfolio of the company.

A reasonable budget should be provided for the development of IP. Many times research, development, and marketing efforts are hampered when not enough funds are allocated. More importantly, management must give the creative team the latitude and flexibility to work and also be prepared to review their efforts with an open mind – too many times a good idea is defeated by a conservative management. The term ‘think outside the box’ should be as important to the management as it is to the creative team.

Lastly, it must be remembered that innovating and creating is an ongoing concern. The best companies sustain their research and development year after year; constantly pushing the envelope and staying ahead of the competition.

Valuable IP must be protected against infringement otherwise its worth will be diluted. Protection for IP rights is governed by legislation in Malaysia and the four main rights – trade marks, copyright, patents and industrial designs – are recognized in this country.

In order to qualify for protection, the IP has to be capable of being ‘pigeon-holed’ under one of the four main rights mentioned above. It should be noted that there are peculiar exceptions under each piece of legislation and not everything can be protected. For example: colours per se cannot be registered as a trade mark, copyright will not cover ideas, and a patent cannot be granted for rules or methods for doing business. There are many more exceptions and professional advice should be obtained when in doubt.

To obtain the protection itself the IP rights must be registered except for copyright, which accrues automatically. Registration is a process that takes time (usually measured in years) so it is prudent to make the application as soon as possible.

It is worth mentioning that IP protection is a matter of sovereign national legislation. Hence, registration in one country only protects you in that country. There is no such thing yet as an international registration that gives you worldwide coverage. However, there are certain protocols and treaties that aim to provide a common filing system that helps cut down the paperwork for registration in multiple member countries.

Management & Exploitation
Like any other corporate asset, IP needs to be managed. Management involves keeping a diary system for rights like patents, trade marks and industrials designs because they need to be periodically renewed. It also involves keeping track of how the rights are used and presented and monitoring the marketplace for competition or infringers. Scrupulous records should be kept for the IP, including any licenses, agreements, or legal documents that are relevant. Even press clippings, advertisements, articles or write ups about the your products and services should be filed as they can serve as supporting documents when there are disputes or litigation; this is especially true of cases involving trade marks and branding.

Beyond management is aspect of exploiting your IP, putting it to work to generate income for the company. Think of the business and revenue model – will the product be manufactured in house or licensed out to others, perhaps domestic production can be supplemented by contract manufacturing abroad. Different considerations apply to different goods and services and each of the various IP can be leveraged and applied differently. Managing and exploiting IP in the right manner ensures maximum returns.

The above is a very brief overview of the role of IP as an important component in the K-Economy. Pursuing an IP strategy that addresses the four areas above is a prerequisite for companies intending to make their way into the K-Economy.