Patent-pools managing capabilities: An exploratory case study

In this paper, we explore the capabilities of patents-pools' management as a form of open innovation. According to Chesbrough (2003 p.xxiv), "open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology". Patents-pools are agreements among several patents-holders (firms, university, etc.) to share their patents and to offer a package license to others firms in return, more often, of a royalties payment. Thus, patents-pools are an original form of open innovation since they permit, on a large scale, the use and valuation of external and internal patented knowledge through external and internal business models (Rayna and Striukova 2010). Patents-pools occupy an increasingly important position in industrial and commercial landscapes, both in terms of sectors and incomes of related products and attract attention of scholars in management science. Existing contributions address mainly the issues of antecedents and consequences of patents-pools formation without studying how firms manage this form of open innovation or strategic alliance. Using a qualitative research, we analyze the practices established by Technicolor - a worldwide technology leader in the media and entertainment industry - to manage its participation in several patents-pools. Our case study shows that firms need to master three kinds of capabilities to benefit from their participations in patents-pools in terms of value creation and appropriation. These capabilities are: absorptive capability, desorptive capability and capability of patents generation related to the fields of the patents pools. We argue that the combination of these capabilities enables firms: to strengthen their innovative capability by leveraging external knowledge, to establish their technologies as standard in the industry and to capture a bigger share from created value (turnover of products and royalties). We also stress out the nature of the symbiotic relationship between these three capabilities and innovation capability.