This is the innovation age. The core assets of modern firms are not their bricks and mortar or their machinery and equipment, but their employees and, more particularly, the ability of those employees to identify and resolve product and process problems, in a commercially valuable way. Human capital, intangible though it may be, is the pre-eminent factor determining a firm’s ability to compete; the translation of human capital into intellectual assets is the pre-eminent objective of that competition.

Put simply, the business of North America today is, in large measure, the business of innovation.

The premise of this book is that firms derive value from innovation by making innovation proprietary. They do so by securing exclusive rights in innovation in the form of patents, trademarks, copyrights, industrial designs, and trade secrets, among others.

While exclusivity may not be the sole method of deriving value from innovation the fact is (as Chapter 1 demonstrates) that firms are registering or otherwise protecting their intellectual property rights in record numbers, and are prepared to incur substantial costs to do so.

It is indisputable that firms now understand the value of intellectual property. Many recognize that the value locked up in IP assets may be extracted through licensing. Indeed, licensing has become the central focus of intellectual property management in the last five years. Licensing can generate substantial revenues that go "right to the bottom line".

What very few firms have recognized, however, is that licensing is but one of a range of transactions by which the underlying value of intellectual property assets can be realized.

This book is meant to outline the variety of intellectual property asset transactions available. It is intended to contribute to a more comprehensive view of the business forms and models that can be employed to encourage and extract value from innovation. It is, in that sense, very much a book about the business of innovation. At the same time, the authors address the problems that hamper intellectual property transactions - the absence of an efficient market, difficulties in valuation, the reticence of lenders, and the absence of certainty in secured transactions involving intellectual property assets.

The perspectives brought to bear on these and related issues are the perspectives of those most intimately involved - intellectual property agents, commercialization specialists, commercial lawyers, valuators, intellectual property lawyers, tax specialists, accountants, insurers, and litigators.

The age of innovation is here, but the business of leveraging knowledge-based assets is still in its infancy. This is a developing field, and for that reason the book is not authoritative study. It is meant, rather, as a primer. It is directed to those new to the field as well as to those who, as specialists in one or another of the many fields of practice relevant to intellectual property asset transactions, seek some basic understanding of the principles and issues in other relevant specialties.

The text itself is organized to acquaint the reader, in general terms, with the strategic and revenue-generating aspects of intellectual property assets (Chapter 1) and the commercialization of those assets (Chapter 2). The nature and variety of intellectual property asset transactions are then described (Chapter 3). The book moves on to deal with specific issues such as due diligence (Chapter 4), licensing (Chapter 5), valuation (Chapter 6), taking and enforcing security interest in intellectual property assets (Chapter 7), the taxation of intellectual property transactions (Chapter 8), accounting for intellectual property transactions (Chapter 9), and insuring against intellectual property transaction risk (Chapter 10). It is the authors’ hope that their perspectives, taken together, will provide a broader view of the world of intellectual property asset transactions and generate more detailed and specific analyses by others.

type The Business of Innovation: Intellectual Property Transactions in Canada