MARKET-BASED strategies that KEEP PIRATES IN PORT. The LAW is often not the best defense against theft of intellectual property. Far more effective in such cases are MARKET-BASED strategies that KEEP PIRATES IN PORT.

Companies facing threats to their intellectual property have a range of alternatives, from defending their core assets to embracing the businesses that threaten those assets. The choice of strategies – and tactics to support them – depends on the nature and intensity of the threat and the strength of a companys resources. Market Strategies ?????? Defend Core AssetsEmbrace the Threats

PREEMPTION : Being first to market so that you can capture profit of monopoly scale. - Intel preempts rivals by tightly managing its relationships with external constituencies( Customers, Users, and Suppliers) OVERWHELMING: - Capital One, the credit card issuer, overwhelms its rivals with a blizzard of new product KEEP THEIR INTELLECTUAL PROPERTY OUT OF SIGHT FROM THE START : For companies that lack Intels or Capital Ones resources and core strengths - Coke s recipe has never been deconstructed or revealed Market Strategies 1. Nip It in the bud 1 Act Before Competitors, So Catch Their Breath ! PREEMPING / OVERWHELMING / EXCLUDING Defend Core AssetsEmbrace the Threats

- SEDATING EFFECT on an underground market in weakly protected intellectual property. CROSS-LICENSING AGREEMENTS: - SEDATING EFFECT on an underground market in weakly protected intellectual property. Companies do not sue one another for infringement because they know they are likely to infringe the infringers patents sometime in the future. Market Strategies 2. Prescribe a Sedative 2 Lower The Competitive Intensity THREATEN TO RETALIATE Defend Core AssetsEmbrace the Threats

Companys economic viability is usually tied to one or a few key properties. CREATE SYNERGIES AMONG RELATED BUSINESSES: Companys economic viability is usually tied to one or a few key properties. By forging synergies between such properties and adjacent ones company can protect its profits from rivals and poachers. - Hit television shows leads audiences to the next program and CROSS PROMOTE other shows on the same network. Market Strategies 3. Dig a Honey Pit 3 Entangle Key Assets FORGING SYNERGIES Defend Core AssetsEmbrace the Threats

It can be wise to marry that asset to a complementary product. MARRY ASSETS: (Enhanced value of the package ) In situations where its difficult to establish property rights to an asset, It can be wise to marry that asset to a complementary product. - Excel, Word ( stand alone software applications ) can be easily copied and disseminated, but the Microsoft itself enhances the value of the package so it makes more likely that a would-be copyist will pay for it. ADD-ONS : Provides additional functions or customization for a core application. - In the book industry, publishers sometimes insert a CD or sort of things in t he back cover of their books. Market Strategies 4. Make a Bundle 4 Defend Core AssetsEmbrace the Threats Combine Secure with Insecure Products MARRY ASSETS / ADD-ONS

REDEFINE BOUNDARIES: Challenge for companies how to get a piece of COMPLEMENTS. - Unlike the increasing piracy rates in music industry, not all music-related businesses are vulnerable. For example, blank CDs, computers with a CD burner, and portable MP3 players. Market Strategies 5. Move the Goalposts 5 Defend Core AssetsEmbrace the Threats Redefine the Firms Boundaries EXPANDING / NARROWING

REALLOCATE RESOURCES TO ADJACENT BUSINESSES: For companies that have moved the goalposts and now encompass more viable businesses. It may pay to disregard the decline in their core. - Several of music companies viewed the online customer as a threat, they tried to charge as much for downloads as they did for CDS, even though the costs of online delivery are minimal. By contrast, Apple wasnt afraid to set prices low enough to change music –buying ha bits. Market Strategies 6. Let the Dogs Out 6 Defend Core AssetsEmbrace the Threats Relinquish Your Core Assets MOVE THE GOALPOSTS, then REALLOCATION

Market Strategies NIP IT In the Bud Prescribe Sedative DIG HONEY PIT Make BUNDLE Move Goalposts Let the DOGS OUT Preempt Deny access Out- innovation Threaten To retaliate Create Synergies ( Among related businesses ) Marry assets To complementary products Preserve The core with Add-ons Expand into rivals businesses Narrow your Own business Reallocate Resources to Adjacent businesses