Report following May and June 2012 (wave one)

Intellectual Property Roundtable Discussions with Innovative Canadian SMEs

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Conducted by the Canadian Intellectual Property Office (CIPO)

Final Report

Prepared by the CIPO Outreach Program

October 30, 2012


Executive summary

The Canadian Intellectual Property Office's (CIPO) 2012-2017 Business Strategy focuses on better understanding customers' innovation and intellectual property (IP) needs. Consequently, CIPO's Outreach Program conducted a series of 18 roundtable discussions with innovative Canadian small and medium-sized enterprises (SMEs) across Canada in the spring of 2012.

The participants were segmented into three groups: users of the patent system; IP users other than patents (trademarks, industrial designs, etc.); and non-users of the IP system.

This report summarizes the SMEs' feedback on their decision-making process in filing for IP protection, how they use the IP system, some of the key barriers and challenges they face when protecting their IP and the type of assistance they would like. The report also lists some suggestions made by the participants on ways to improve their use of IP.

Decision-making process in filing for IP protection

The SME decision-making process for protecting their intellectual property is complex and encompasses a variety of elements. The decision whether or not to seek formal IP protection is most strongly influenced by cost, the technology at stake and the potential markets.

Market size is an important criterion in the decision about where to file. Many roundtable participants who are users of the patent system tend to select the United States as their primary filing country, often because of the size of the US market and the availability of the provisional patent application option.

Some participants that develop products with a smaller life-cycle or that can easily be copied will often choose to use trade secrets to protect their innovations.

Use of the IP system for SMEs

The IP system is primarily used to defend against infringement (it prevents competitors from using or selling an SME's product) or to leverage funding (since more and more investors take into account if an IP is protected).

While keeping abreast of market and business trends was seen as critical for innovative Canadian SMEs to become or remain leaders in their field, very few participants said they made use of the information contained in IP databases as a way to gather strategic business and technical intelligence on their competitors and their technology.

Key barriers and challenges

Participants said the main barriers in seeking IP protection are costs and the complexity of the IP system. They indicated having to make the difficult decision between investing time and effort on research and development (R&D) or in other corporate activities, such as seeking IP protection.

Developing an effective IP strategy is considered challenging by the SMEs, mainly due to the complexity of IP and the lack of information and advisory resources available to coach or counsel.

Type of IP assistance sought

The majority of participants agreed on the need to consult with an IP professional to guide them through the IP granting system. They expressed the need for quick and easily-accessible assistance and information to be available throughout their IP seeking process. Very few participants had ever dealt with CIPO directly.

Suggested changes to the existing IP system

Participants provided suggestions to optimize their use of the IP system, such as improving the communication between CIPO and IP applicants, regardless of whether or not an IP agent is acting as a representative. Other suggestions included the harmonization of decisions on patent applications filed in multiple jurisdictions, particularly in Canada and the USA.

Suggested services, products or tools for innovative SMEs

Participants generally agreed that CIPO should be more active in disseminating relevant IP information to innovative Canadian SMEs; for example, providing updates on changes to IP regulations, guidelines on how to select an IP agent, advice on how to develop a strong IP strategy and how to search IP databases. This would increase their level of IP awareness, help them make better informed decisions and allow them to establish a sense of trust with both CIPO and the IP system. Participants also suggested clarifying the guidelines on IP-related funding or tax credits available to innovative SMEs.

Next steps

CIPO plans to use the information collected during this first series of roundtables to improve its services and better meet the needs of customers. Some of the suggestions put forward will require further discussions during the next series of roundtables.

Introduction

This report presents the key findings from the IP roundtable discussions conducted by CIPO with innovative Canadian SMEs in the spring of 2012.

The first part of the report presents the key findings of the roundtables, including information on how innovative Canadian SMEs use the IP system, their decision-making process in filing for IP protection, key barriers and challenges faced by SMEs and the type of IP assistance SMEs seek.

The second part of the report presents suggestions for how to improve the existing IP system, as well as a description of the kinds of services, products and tools SMEs would like to increase or facilitate their use of IP.

Roundtable questions, other observations, and participant demographics can be found in the annexes.

Roundtable purpose and objectives

The overall purpose of the roundtable discussions was to gather information on the behavior and decision-making process of innovative SMEs in order to better understand their IP needs and any barriers to their successful use of the IP system.

Roundtable participants and partner organizations

The National Research Council's Industrial Research Assistance Program (NRC-IRAP)Footnote 1, Canada's flagship program supporting innovative and R&D focused SMEs, collaborated with CIPO on this initiative.

SMEs invited to take part in this series of roundtable sessions were for the most part IRAP recipients who had received program funding ($25,000 or more) between 2008 and 2011, or were in the initial stage of seeking IRAP assistance.

Additional SME participation was also secured through IRAP's various regional networks that provided names of innovative SMEs demonstrating a high potential in developing IP.

A total of 90 SMEs took part in the roundtable sessions. Participants were small business owners (mostly below 50 employees) and some were owners of multiple start-ups. The vast majority were chief executive officers (CEO), chief technology officers (CTO) or vice presidents.

Participants were separated into three groups:

  1. Group 1 — users of the patent system: filed for patent protection at least once in Canada or abroad
  2. Group 2 — users of the IP protection system other than patents: have not filed for patent protection in Canada or abroad, but have filed for another type of protection such as trademarks or industrial design
  3. Group 3 — no experience with the IP protection system: have not filed for any type of IP protection in Canada or abroad and very often have a low level of IP awareness

Roundtable locations

The roundtable discussions were conducted from May to June, 2012. The sessions were held at NRC-IRAP premises and were facilitated by CIPO. A total of 18 sessions were held in the following cities:

  • Ottawa
  • Montréal
  • St. John's (NFLD)
  • Winnipeg
  • Vancouver

The selection of these cities was determined by the following criteria: distribution of IRAP recipients, level of patent activities and availability of IP professional services (i.e., IP agents). Separate pilot sessions were held with IRAP industrial technology advisors (ITAs) in the Ottawa area and with a small group of SMEs in order to validate the questions prior to the official launch of the roundtables.

Part I - Key Findings

1. What is an innovative SME's decision-making process in filing for IP protection?

The SME decision-making process for seeking IP protection encompasses a variety of elements and is influenced mainly by costs associated with seeking formal IP protection, the SMEs' field of technology, and their specific market. For some SMEs, seeking IP protection is an overall strategic decision integral to their business model; for others, it is a targeted decision used mostly to defend against infringement.

Finding 1.1 Costs and competing priorities

Many participants mentioned that, in spite of the importance they attribute to it, IP is only one priority competing amongst others of equal importance, such as investing in R&D, hiring additional staff and marketing. Many find balancing competing priorities to be difficult; often IP is neglected, usually for lack of financial means.

Finding 1.2 "Not to file" strategy and trade secrets

Some participants indicated that they sometimes make a strategic decision not to seek patent protection in order to "stay under the radar" of their competitors. These participants said they use trade secrets to protect their innovations, especially when developing products with a shorter life-cycle or that can easily be copied (e.g., software).

Many participants that favoured trade secrets indicated they were uncomfortable with the obligation to disclose all the elements of their invention when filing a patent application. Trade secrets were perceived by many as the best method to protect their innovations, despite the constant vigilance and other efforts required to maintain secrecy.

Finding 1.3 Filing in the US

Users of the patent system (Group 1) indicated that their preferred strategy was to file a provisional patent applicationFootnote 2 in the United States, often prior to filing under the Patent Cooperation Treaty (PCT)Footnote 3. Canadians typically file more patent applications at the USPTO than at CIPO.

The US is often a primary filing country because of its market size and the availability of appealing patent filing options (such as the provisional patent application).

Participants that had filed a provisional patent application in the United States perceived the following benefits:

  • fewer upfront costs than a full patent application;
  • provision of an early filing date, which is critical for an innovative SME in order to secure a space within the patent landscape and manage market entry timing; and
  • ability to initiate the filing for patent protection and remain "under the radar" while exploring the viability of their invention.

Other markets of interest outside of Canada and the US mentioned were Europe, Japan, and emerging economies. Participants said their decision about where to file or apply for IP protection is based primarily on the market. However, there appeared to be a negative perception towards the IP system in China and many indicated their reluctance to file in that country.

Summary

In summary, for most SMEs, IP is only one priority competing amongst others of equal importance. Many participants make a strategic decision not to file for patent protection, choosing to rely on trade secrets to protect their IP. Other participants prefer to file for patent protection in the US because of its market size and appealing patent filing options.

2. How does an innovative Canadian SME use the IP system?

Taking into consideration a broader definition of the IP system that includes not only obtaining IP rights but also the use of business and technical information found in IP documents as well as the licensing of rights and the leveraging of IP for securing financing, participants were asked about the different ways they use and take advantage of the IP system.

Finding 2.1 Protection as one of the main benefits of owning IP

Protecting IP prevents competitors from using and selling an SME's product or service. In addition, it provides the SME with the freedom to operateFootnote 4 in specific markets and the ability to sell or licence their product or service. A large proportion of participants using patent protection (in Group 1- patent users) described an IP right as being similar to an insurance policy: it becomes useful only when faced with a litigation situation.

Finding 2.2 IP to leverage financing

Many participants recognized that owning IP is beneficial when seeking financial assistance or when securing venture capital from investors. According to a large majority of the participants, investors give value to an IP portfolio and will take it into account as part of their investment decision.

Finding 2.3 IP as a marketing asset

Many participants indicated that owning intellectual property provides extra leverage in the area of marketing their business to potential clients; they use their IP as a way to brand their company as being innovative and leading-edge.

Finding 2.4 Low usage of IP system for gathering business intelligence

Gathering business and market intelligence was described by all roundtable participants, regardless of their region or their sector of activity, as being a critical ongoing process in developing their business strategy. The majority of participants said this information is crucial for their market strategy; however few indicated they use the information contained in IP databases to gather such intelligence.

The main search tools used by SMEs to gather business intelligence are: Google, Wikipedia, corporate websites, products on the market, trade shows and strategic information from their clients and competitors. SMEs also rely on innovation- and industry sector-specific documentation (e.g., trade journals, scientific articles and financial reports). Many participants mentioned that seasoned or successful entrepreneurs tend to use their networks as another venue to gather business intelligence.

Few participants said they had a clear understanding of the value of information contained in IP databases. Thus, they do not have a tendency to use IP databases (specifically patent databases) to gather business and technical intelligence.

The few who were familiar with patent databases said they used the data to verify the patentability of their innovation; however they rarely use IP databases to gather competitive intelligence. Due to lack of time and knowledge, most will hire an IP agent to perform this search.

The users of patent databases said they first look through the United States Patent and Trademark Office (USPTO) database, followed by the European Patent Office database (Espacenet), and then Google Patents. Few mentioned using CIPO's databases and web-based tools.

Finding 2.5 Non-disclosure agreements

All participants recognized the importance of having non-disclosure agreements (NDAs) or confidentiality agreements in place. They all acknowledged the importance of making employees aware of their obligations when signing NDAs as part of the hiring process. However, many said it is difficult to ensure that all employees understand how critical it is to maintain secrecy and not to inadvertently disclose crucial information.

Finding 2.6 Sector-specific approaches

  • In the software sector, there was a general consensus amongst participants that technology developed in this sector evolves rapidly, making formal IP protection too complex, costly and time-consuming to be of interest for the majority. Copyright protection, encryption and trade secrets were often mentioned as preferred methods of protection for this sector.
  • Many in the firmware sectorFootnote 5 use trade secrets to protect their IP. It was also noted by several participants that encryption of the firmware is usually handled by a third party, which adds an additional layer of protection against infringement.
  • Participants from the health sector prefer to seek patent protection as they also have to deal with national regulatory agencies (e.g., Health Canada and the Food and Drug Agency), which often require lengthy approval processes for products.
  • In the food industry, there is a perceived fear that new processes for recipes will be copied; participants involved in this sector said they usually used trade secrets.

Summary

Essentially, how an innovative Canadian SME uses the IP system will depend on its level of knowledge of IP. Most of the time, IP is used to defend against infringement or to leverage financing.

3. What are the key barriers and challenges faced by an innovative SME in protecting their IP?

Finding 3.1 Costs seen as the main barrier to IP protection

The costs associated with filing for IP, including agent fees, translation and maintenance, were viewed by most participating SMEs as an impediment in seeking IP protection, especially in light of competing priorities, as mentioned previously. SMEs perceive IP protection as a long-term investment, which is in direct competition with initial short-term investments, such as taking a product to market.

Finding 3.2 Complex and lengthy process

Many participants viewed the patent filing process as complex, lengthy, and often ill-adapted to a fast-paced small business environment. Also, in many instances, participants noted that the legal language used in preparing IP documents adds an extra layer of complexity.

Many participants believed that the patent examination process appears lengthier in Canada than in the US and other major IP offices. For some, this is an indication that the Canadian examination and prior art search is more thorough; for others, that the Canadian process is more drawn-out and bureaucratic. This overall negative perception of the patent system was the reason given for why trademarks and trade secrets were the preferred methods of IP protection for those within Group 2 (users of the IP protection system other than patents).

Finding 3.3 Challenges in developing an IP strategy

For many IP users, developing a well thought out and effective IP strategy while keeping abreast of the many changes in the IP landscape is extremely challenging, particularly as time, money and resources are usually limited.

Many participants indicated the lack of timely information and assistance during key decision points adds to the challenge of developing an effective IP strategy and making an informed decision on IP.

Finding 3.4 Difficulties associated with calculating the value of IP

Some participants said they view IP as one of many interrelated elements necessary to achieve certain goals included in their business strategy, while many large companies now recognize intellectual capital as their most important intangible asset. For many participants, attributing a value to IP represents a grey area: it is influenced by many varying factors such as technology and market value, and is therefore very difficult to evaluate.

Only a limited number of participants said they calculated the value of their IP portfolio, and then for the sole purpose of obtaining funding or when preparing their business exit strategy.

Summary

In summary, regardless of their location, industry sector or level of IP awareness, innovative Canadian SMEs seem to be facing similar barriers and challenges when dealing with IP. The major barriers are costs and the complexity of the system. Developing a good IP strategy and making informed and appropriate decisions represent a major challenge.

4. What type of IP assistance does an innovative SME seek?

IP-using participants were asked about their experience with services from CIPO and IP professionals. All of the participants were invited to share their views on the existing service gaps.

Finding 4.1 Most SMEs seek professional IP services

When asked who they would most likely consult for IP advice, the IP agent usually ranked in the first three or four responses provided by all three participant groups . Most users of IP (Groups 1 and 2 — users of the patent system and users of the IP protection system other than patents) indicated that they had sought the services of a patent or trademark agent at least once. The vast majority of IP users said their experience in dealing with an IP agent was positive and they were satisfied with the services received.

Non-users of IP (Group 3), for the most part, had not had any dealings with an IP agent because they were either at the initial stage of setting-up their business or they had not yet made a decision about their IP.

The majority of IP users recognized the importance of selecting the right IP professional to suit their needs. Their agent must have the right knowledge and expertise linked to their technology. To save time and effort, participants generally tend to keep the same IP agent over time.

There was, however, a perception of a wide gap in fees per services from one IP professional to another, especially when comparing their hourly rate with other types of professional services. Some participants indicated that they try to do all they can to reduce agent costs (by doing prior-art research, drafting the patent claims themselves or opting to file their own patent application).

Finding 4.2 Despite their use of the IP system, a majority of participants had limited or no knowledge of CIPO

Generally, participants in all three groups had little awareness of CIPO, its mandate and services. Only a small number of participants indicated they had dealt with CIPO or knew about the organization. For many, the roundtable was their first interaction with CIPO and its employees.

The few participants who had dealt with CIPO staff indicated that the service provided was courteous and professional.

Participants that had filed for IP protection in Canada expressed the need for automatic update notices from CIPO on their application status. They would also like CIPO to make important application information and options better known. For example, prior to attending the roundtable, none of the participants were aware of the advanced patent examination process, which allows applicants to request (for a fee) the acceleration of a patent application for examination. Many felt CIPO should be more proactive in sharing this type of information with current and potential users.

Summary

In summary, the majority of the participants felt the need to consult with an IP professional to guide them through the complex and lengthy IP system. Participants also indicated the need for quick and easily-accessible assistance and information throughout the IP protection process.

Part II — Suggestions for Action

Priority 1: Improvements to the existing IP system

IP users were invited to draw from their past experiences and lessons learned to suggest improvements to the existing IP system in order to address some of the issues they identified.

Suggested actions:

Review the administrative process

The administrative process in Canada appears much lengthier than in other jurisdictions, including the United States. The Singapore IP office was mentioned by a few participants as a good example of a place of choice to file in terms of its efficiency in the filing and patent granting process.

Many felt there was a lack of communication between innovators and CIPO. Participants would like to receive updates on their application at each step in the administrative process. Many participants suggested making the application process for SMEs simpler, seamless, efficient, and in plain and simple language.

Provide clear policies and guidelines on eligible IP-related costs

In order to alleviate some of the barriers relating to costs, participants recommended providing clearer policies and guidelines on eligible IP-related costs through funding or tax incentive programs such as IRAP or the Scientific Research and Experimental Development program (SR&ED)Footnote 6.

They also suggested making information about how to prepare an IP application easily available for SMEs, before they seek the services of an IP professional.

A few other suggestions were also made to help reduce costs, such as developing a way to limit and/or control the number of exchanges between the patent agent and the examiner.

Harmonization between jurisdictions

Also consistent among regions, groups and sectors was the desire for harmonization of patent application decisions filed in multiple jurisdictions, namely Canada and the USA . Many participants mentioned instances where claims were accepted by a foreign IP office and rejected in Canada (and vice versa) . For SMEs who filed under the Patent Cooperation Treaty (PCT), this lack of harmonization translates into additional costs.

Having timely information about changes in regulations and about available IP options in different jurisdictions, (e.g., provisional patent applications and PCT) was mentioned by many as a way to assist SMEs in making informed decisions regarding their IP.

Provide a provisional patent application option in Canada

Participants generally recognized that the United States provisional patent application provides additional flexibility. Many participants strongly suggested making a similar provisional patent application option available in Canada.

Provide customized IP protection for the software sector

Participants in the software sector were unanimous in their view that protecting software is very difficult. According to many participants in this sector, the current patent regulations are ill-suited and inadequate to address their needs. Software-sector participants asked if a new form of IP protection could be developed specifically with software in mind. Most participants felt that the granting process should take into account the rapid pace of this sector and a shorter period of protection.

Stop patent trolling

Participants were critical of the presence of patent trollsFootnote 7 in the system, and many participants indicated that there should be a mechanism to prevent trolling, as well as a legal process in place to help SMEs protect (and defend) themselves against patent trolls.

Priority 2: Provide new services, products or tools for innovative SMEs

Participants who used IP were asked the following question: "Based on what you know now and have experienced as inventors and SME owners, what kind of tools or services would you have wanted to have access to when you first began dealing with IP?"

Participants at the early stage of starting their business were asked: "What is currently missing to help you make an informed decision on IP?"

There was a general sense that information on IP should be made more accessible to SMEs, regardless of their level of knowledge and use of IP.

Suggested actions:

Increase access to information through website

Many participants who used IP said they would have appreciated knowing more about CIPO at the early stage of filing for protection. Participants also expressed the need to access tools and information products on IP such as:

  • general information about IP regulations, best practices, risks and useful tools in layman's terms;
  • a checklist, template and Q&As on how to prepare an IP application;
  • details about important patent concepts such as freedom to operate, provisional patent application, PCT, and the patent filing, examination and granting process;
  • information about the various types of IP and their related administrative costs by jurisdiction;
  • guidelines on trade secrets and NDAs;
  • guidance on how to prepare claims and how to file under the PCT;
  • a claim translator, similar to Google translate, to help with nomenclature and application translation;
  • a guide for developing a strong IP strategy;
  • an inventory of IP-related business cases based on factual SME experiences in dealing with IP issues (negative and positive outcomes);
  • tools to help SMEs assess the value of their IP to assist them in making the right business decision; and
  • a licensing matchmaking system to help innovators identify business opportunities.

Provide assistance and guidance/mentorship

Many start-ups suggested making available an IP mentorship service as well as a one-on-one information service geared towards SMEs. Regardless of their level of usage and knowledge of IP, many participants suggested training sessions on how to better prepare their IP application in order to reduce costs. They also suggested training on how to develop a strong IP strategy and ways to maximize their IP.

Provide help on selection of IP professionals

Participants felt that having access to information and advice about IP would help them make sound decisions before hiring an IP professional.

Participants suggested the following to help them with their decision to select and hire an IP professional:

  • Making information about IP agents available on CIPO's website (e.g., résumé, expertise/specialisation, level of experience, number of patents filed, granted, and disputed and service and fee guidelines);
  • Developing questions to help select an IP agent.

Improve linkages

Many participants said it was important to improve collaboration between SMEs and universities on joint IP initiatives, and between CIPO and business organisations (e.g., business development agencies, incubators, national associations, etc.) in order to reach out to innovative SMEs and provide them with important IP information.

Diversify communication strategies

Participants suggested that CIPO should use various communications approaches (e.g., push marketing and by client-segmentation) and media (e.g., traditional, on-line, social media, face-to-face, print). CIPO's website should also be adapted with SMEs in mind, making it less bureaucratic and less government-focused as possible.

Conclusion

This first series of roundtable discussions gave CIPO valuable insight into innovative Canadian SMEs' use of IP, their decision-making process for filing for IP protection and some of the barriers and challenges they face when protecting their IP. The discussions also allowed participants an opportunity to provide suggestions to CIPO on ways to improve SME use of the IP system.

Many roundtable participants indicated they appreciated both the opportunity to speak with CIPO representatives and the efforts being undertaken by the organization to better address their needs.

Key highlights from these discussions are summarized below.

Decision-making process

The majority of participants said they wanted to learn more about IP and how to find reliable and current sources of information in order to make informed IP business decisions.

The decision-making process for considering IP protection is influenced mainly by cost, the technology used by the SME, and their specific market.

How they use the IP system

Innovative Canadian SME use of the IP system depends on the SME's level of IP knowledge and the industry sector they are in. Most SMEs using the IP system are using it first and foremost for protection; many also use IP for market leveraging. Some SMEs see IP as a means to secure financial investors.

There were no major regional or sectoral differences noted between users; however those SMEs involved in software development indicated that current patent regulation is not adapted to their sector.

Many innovative Canadian SMEs using the patent system prefer to file for patents in other countries, mainly the US, since Canada is a relatively small market. Filing a USPTO provisional patent application is viewed by many participants as a good strategy to follow prior to filing a formal patent application.

Very few innovative SMEs exploit the knowledge contained in IP databases for gathering competitive intelligence.

Key barriers and challenges

All participants indicated that the major barriers in seeking IP protection are cost and the complexity of the IP system.

Developing a good IP strategy and making informed and appropriate decisions represent major challenges to SMEs.

Many suggestions were made about ways to address some of the identified barriers and challenges, including posting and promoting factual information online (e.g., CIPO fees, details on the advanced examination process for patent applications, and a list of IP agents with their expertise and a review of their work). Participants said this would increase their level of IP awareness, help them make better informed decisions and establish a sense of trust with CIPO and the IP system.

Type of assistance sought

While the majority of participants agreed on the importance of consulting with an IP professional to assist them through IP filing and administrative processes, they also indicated the need for quick, easily-accessible and impartial assistance and information before, during and after the IP protection process.

Many suggested CIPO offer training sessions and tools to show them how to better prepare their application in order to reduce costs. They also suggested training on how to develop a strong IP strategy and ways to maximize their IP.

Next steps

As stated above, the roundtable discussions provided valuable insight into SME use of IP, their decision-making process, barriers and challenges they face, and suggestions for helping them increase and improve their use of the IP system.

Some of the suggestions given will require further discussions during the next series of roundtables in order to determine the best actions to take to put them into practice.

Acknowledgements

Firstly, CIPO wishes to thank the SME participants who agreed to take part in the roundtable discussions. We are very grateful for their valuable insight and information and for generously taking the time from their busy schedules.

We would also like to thank the National Research Council's (NRC) Industrial Research Assistance Program (IRAP) for its support in conducting this series of roundtable discussions. We wish to extend a special thank you to Llynne Plante, IRAP Regional Director of Ontario, for overseeing the successful national rollout of this initiative to IRAP's regional offices.

These roundtables would not have been possible without assistance on the ground. We greatly appreciated working with IRAP's Regional Management and Industrial Technology Advisors (ITAs). We thank them for generously contributing their time, experience and networks to this initiative.

Within CIPO, a special word of thanks goes to Linda Pichette and Sophie Nadeau who graciously helped with the successful organization of these sessions, as well as to Suhas Deshpande and his team for providing client analytical support .

Report contributors:

Pierre-Olivier Carrier, Richard Leclerc, Caroline Lefebvre, Michel Loiselle and Rachel Roy.

Annex 1 — Roundtable questions

Ice-breaker

  • When you think about IP, what two or three words come to your mind?

Competitive intelligence

  • How and where do you gather your intelligence/strategic information?
  • How important is it for you / and how do you establish its value?
  • What tools do you use?
  • Who performs this activity (internal or external?)
  • How do you validate this information?
  • How is it helpful in developing new products, partners, markets, distributors, etc?

Preparing and securing IP protection

  • When do you start thinking about IP protection?
  • How do you determine if your innovation contains any IP?
  • Who is your first point of contact to provide any information or assistance on IP?
  • How do you determine if you will seek formal IP protection?
  • Are you aware of the concepts of freedom to operate, non-disclosure, confidentiality agreements and trade secrets and if so, how important are they in your strategy?
  • Have you ever dealt with an IP agent: level of satisfaction, any comments, anything missing or to improve?
  • How do you attribute a value to your IP portfolio and who do you consult about this?

Challenges and benefits relating to IP

  • What challenges did (or do) you face when looking for a trusted source of information?
  • What kinds of challenges do you face when exporting and seeking IP protection abroad?
  • What are the most important benefits in securing IP protection?
  • What is the best added-value of IP for an innovative SME?

Experience with CIPO services

  • Have you ever dealt with CIPO?
  • What type of services did you seek?
  • What are your impressions on the services received?
  • Anything to add or to improve?

Lessons learned

  • Looking at where you are now, with your experience and lessons learned:, what kind of tools and services would you have loved to have access to, at the very beginning?
  • What could help you maximize your IP portfolio?
  • What are your suggestions to help address the challenges faced by an innovative SME?

Final comments

  • Anything else to add or suggest?

Annex 2 — Other observations

Participants were asked at the beginning of each session to describe the first two or three words that came to mind to describe IP.

"Protection" was the most frequently used word; a majority of participants considered intellectual property as a protection measure more than anything else.

For some participants coming mostly from Group 1 (patent users), IP was perceived as being an "investment" and a "valuable resource," and as creating a "barrier of entry" for competitors. Words such as "challenging" and "competitive advantage" were also amongst the words most often cited.

For some other participants, most frequently within Group 2 (users of IP other than patents), there was an overall negative perception of the IP system, mainly caused by past negative experiences. These participants viewed the IP protection process as costly, lengthy and poorly adapted to their needs (e.g., software protection). They described IP with words such as "money," "expensive" and "not protective enough," as well as "confusing,'' "lengthy," "paper work," and "boring."

For others, mostly non-users from Group 3, IP did not evoke any particular description beyond general IP concepts such as "patents," "trademarks," "trade secrets," "innovation" and "unique."

In general, the impression depended on the participant's level of IP knowledge and their past experiences with the system.

Disconnect between universities and small businesses

The importance of having better linkages between universities and SMEs was raised by several participants across various groups, regions and sectors.

According to participants, collaboration between universities and SMEs, although beneficial for both, is at times problematic due to diverging views in terms of the management and ownership of IP.

Fear of litigation

The cost of filing was often compounded by SMEs' fear of the prohibitive costs of potential litigation by large corporations.

Many participants said that, as small businesses, they are not in a financial position to fend off larger competitors wanting to pursue legal action. As a result, the fear and costs relating to possible litigation becomes a significant deterrent for many SMEs contemplating seeking IP protection in the first place.

IP assistance

Patent and trademark users tended to provide more hands-on suggestions about how to improve the IP system or CIPO's tools; early-stage companies (mostly non-users) tended to look for broader services, such as mentorship and guidance programs. There was a general sense that IP information should be made more accessible to SMEs, regardless of their level of knowledge and use of IP.

Most participants admitted to using the IP system as protection, a defence against infringement or to leverage funding. However, some distinctions were noted across the type of user groups according to their level of knowledge and usage of IP.

Knowing where to seek trusted and prompt IP information is crucial for SMEs in order to be able to make informed decisions regarding their IP.

Annex 3 — Participant demographics

A preliminary list of potential participants was created by CIPO in consultation with the Industrial Research Assistance Program (IRAP), taking into account the following criteria: the use or non-use of the IP protection system, a cross-section of technology industry sectors, and distribution across the five targeted cities.

Using this preliminary list, IRAP's Industrial Technology Advisors (ITAs) from each region approached their respective clients to confirm their interest in participating in the sessions. The ITAs also engaged their regional networks to complete the list. Those who consented to taking part in the discussions received a formal invitation from CIPO.

Prior to the sessions, participants were asked to self-assess their level of IP knowledge and experience in filing for IP protection by responding to the following two questions:

  1. How familiar is your organization generally with IP?
    • Very
    • Somewhat
    • Very little
    • Not at all
  2. Has your organization filed for IP protection in Canada or abroad?
    • Patent
    • Trademark
    • Industrial Design
    • None

This information was used to separate the participants into three groups:

  1. Group 1 — users of the patent system: filed for patent protection at least once in Canada or abroad
  2. Group 2 — users of the IP protection system other than patents: have not filed for patent protection in Canada or abroad, but have filed for another type of protection such as trademarks or industrial design
  3. Group 3 — no experience with the IP protection system: have not filed for any type of IP protection in Canada or abroad and very often have a low level of IP awareness

A total of 90 SMEs took part in the roundtable sessions . Participants were small business owners (mostly below 50 employees) and some were owners of multiple start-ups. The vast majority were chief executive officers (CEO), chief technology officers (CTO) or vice presidents.

All were either recipients of IRAP funding, were in the initial stage in seeking program assistance from IRAP, or were SMEs recommended by IRAP's networks as having a high potential in developing IP in the near future.

Representation by IP use

The distribution by type of user groups was as follows: the first group (patent users) represented approximately 42% (37 participants) of the total number of participants; the second group (IP users other than patents) represented 24% (22 participants); and the third group (non-users of IP) represented 34% (31 participants) of the total number of participants.

Representation by IP use
 Group 1 — Patents users  Group 2 — Other IP users  Group 3 — Non-users
Representation by IP use 42% 24% 34%

Participant representation by city

While participant representation in Ottawa, Montréal and Winnipeg was similarly distributed (26%, 26% and 22% respectively), there was a lower participant representation in St . John's and Vancouver with 12 participants in each city (representing 13% of the total number of participants respectively).

Participant representation by city
Ottawa Winnipeg Montreal St. John's Vancouver
Participant representation by city 26% 22% 26% 13% 13%

Representation by industry sector

Participants were primarily from the following industry sectors: the Software Sector (38%) followed by IT Hardware (19%) and Manufacturing & Materials (13%). The other sectors represented were: Agriculture & Food (8%); Energy & Environment (8%); Construction & Related Products (7%); Human Resources Consulting Services in the area of technology (4%); and Health & Life Sciences (3%).

Representation by industry sector
Software IT Hardware Manufac. & Materials Energy & Environment Agriculture & Food Construction & Related Products HR Consulting Services Health & Life Sciences
Representation by industry sector 38% 19% 13% 8% 8% 7% 4% 3%
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