Licensing Tutorial - Licensing and alternatives

L07 Licensing and alternatives

Licensing is one of the many possible forms of co-operative agreement between companies.

These vary in the degree of integration and control that can be achieved and whether they are internally controlled or driven by market forces.

Strategic alliances involve closer forms of co-operation than arm's length transactions but fall short of acquisitions or mergers. Both licensing of Intellectual Property and learning can play a key part in them.

Alternatives should be considered when thinking about licenses. Would acquiring or merging with a company be better strategically than licensing? Conversely, would licensing be more advantageous than acquiring or forming a joint venture with another company? Would it be better to sell a patent than license it?

This tutorial deals specifically with licensing. Whether or why one should license is covered shortly as part of Licensing Strategy .