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Special Report
University Entrepreneurship

 March 2000

 

 

Maximizing Opportunities

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When the academic pace meets Internet time schedules, commercial opportunity and recognition can get lost. Many Virginia Tech ECpE researchers are saying that, in the future, delays imposed by the academic culture on top of an already lengthy U.S. patent process could cost the university millions of dollars in lost patent revenues. Without basic patent protection of its technology, the university does not receive the credit for the advances that boost the profits of many firms.

"In my field, and the market we exist in, things are happening by the hour," said Jeff Reed, a DSP expert in wireless technology. Universities who make the most of their intellectual capital take steps to uphold an "IP culture" in which every faculty member, student, administrator, and department involved in the technology transfer process is empowered to be responsive to the pace of industry, he said.

Fred Lee, director of the Center for Power Electronics Systems, is in another fast-moving field. "In my industry, companies can get some level of patent protection in two weeks," he said. "The time that we must wait at Virginia Tech can make much of our technology worthless."

Tech's patent process is managed by Virginia Tech Intellectual Properties (VTIP), which follows the university guidelines established in 1991. Once an invention disclosure is filed with VTIP, the University Intellectual Property Committee (IPC), composed of faculty and staff from across the university, meets to confirm the ownership and recommend action to VTIP. VTIP invests in marketing and patenting based on a number of factors: IPC Committee recommendation, preliminary market valuation reports, interest by faculty in commercialization, and VTIP's impression of the risk and reward, according to Michael Martin, executive vice president, VTIP.

"Over the past six years, VTIP has invested more than 72 percent of its total patent budget in physical science and engineering," he said. "During the same period, those inventions only generated 5 percent of the excess revenues of VTIP."

To react to the needs of rapidly changing markets, VTIP has started filing provisional patent applications where there is a need to publish or if the IPC recommendation is positive. "On several occasions, VTIP has protected disclosures on the same day that they receive them due to a pending publication."

When a patent is licensed, the inventors split 50 percent of the royalties; 10 percent is awarded to the department or center and 40 percent is kept by VTIP to transfer to the university. Over the past nine years, VTIP has generated almost $4 million for the university, the departments and the inventors.

Lee, who has about 20 patents and has filed more than 100 disclosures, cites a recent example of academic culture costing the university a lucrative opportunity.

A student in the power electronics research group developed technology that allows Intel's Pentium II chip to process power quickly enough that the chip can achieve its design speed. The group filed an invention disclosure. "As professors, our first responsibility is to the student," explained Lee. "The student wanted to publish the results in order to jumpstart a career. We had a year's protection after the disclosure was filed, which was time to get patent protection."

VTIP pursued patenting, but no company was secured to fund the patent and the time expired, he said. "In the end, the student presented the paper because it was important technology," Lee said.

"We came up with something that the industry has now adopted as standard practice," he said. "The industry is using the technology and making a fortune, but we are not participating because it is impossible to go back and say, 'you are infringing on my patent.'"

The university needs to develop a more workable procedure for the fast-moving applications of today, Lee said. Also, if Virginia Tech is serious about capitalizing on its technology base, it needs to invest in the IP process. "VTIP does not have money to fund a patent for every disclosure, and is forced to make decisions in areas where it lacks expertise," he said.

"This is an example of the clear difference between academic and marketplace cultures," said department Head Leonard Ferrari. "Since university researchers are developing more technology that has value in the marketplace, Tech should consider updating its patent policies and investing in VTIP. At present, VTIP is forced to make very difficult decisions in selecting which properties to protect. This is a case where a little investment could reap great rewards."

Faculty members also need to stay abreast of the markets where their research is applied, he said. "University researchers who develop technology with commercial potential must be able to make a strong case for its marketability to VTIP and the entrepreneurial community," he said.

"We have to realize that our research in engineering today is no longer solely within the ivory tower."

 

The Bradley Department
of Electrical and Computer Engineering
Virginia Tech


Last Updated, March 30, 2000
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