In today’s world, Intellectual Property (IP) has become the lynchpin of a modern university. It is said that IP is the foundation of a new university. This can be majorly attributed to a legislation in the United States, The Bayh-Dole Act or Patent and Trademark Law Amendments Act (enacted in 1980). This act enabled commercialization of inventions developed under federally-funded (publicly funded) research programs, thus becoming a revenue stream not only for the universities but also for the faculty and researchers.
The Act was predominantly targeted at universities, non-profits and other small businesses. Prior to this Act, any invention emanating out of a publicly-funded university was not allowed to be commercialized, as it was seen as a means to privatize technology created using public funds. The Indian analogue of the Bayh-Dole Act was the PUPFIP (Protection and Utilization of Publicly Funded Intellectual Property) Bill of 2008. However, the bill failed to become an act owing to certain controversy surrounding it. The “New” universities were not just expected to teach but were also expected to create technological solutions to help the society. IP was a tool to harness new technology, which can be attributed to the fact that it is difficult for an investor to invest in a new technology unless it is protected. This focused research by the universities also helped in the development and dissemination of the knowledge associated with that research.
In today’s innovation-era where innovation forms the crux of our lives, measuring innovation becomes equally important. In an industry or a firm, innovation is characterized by the number of new products, processes or services. In a university, which predominantly engages in teaching or research, the research activities lead to innovation. Apart from the capital invested into university research, the research in universities can also be quantified by measuring the outcomes of research, majorly -publications, patents and disclosures. The protection of intellectual assets arising out of such university research becomes equally important. Thus, IP (the number of patents or publications) provides us with a metric to measure innovation. In this case, patents cover proprietary rights while publications cover general knowledge emanating out of university research.
Licensing IP is a potential revenue stream for the university (and faculty/researchers). This revenue generated out of licensing IP can be re-invested into further research, thereby propagating the innovation cycle.
The top ranked institutions in India are also the top performers in IP. For instance, IIT Madras, IIT Bombay, IIT Delhi, IIT Kharagpur and IIT Kanpur were the top 5 rankers as per NIRF (National Institutional Ranking Framework) in 2016, 2017 and 2018. It was also observed that they were the top institutions in terms of patent activity. The following image illustrates the same.
Based on a survey, it is estimated that Stanford alumni and faculty have created 39,900 companies since the 1930s, which if gathered collectively into an independent nation would constitute the world’s 10th largest economy. Interestingly, Nearly 15 schools produced 70% of all patent license royalties for US universities in 2014.
Thus, Intellectual Property is a metric of innovation in a university. Licensing IP is a potential revenue stream not only for the university but also for the faculty and researchers, thus acting as an incentive for research. As depicted above, the revenue can be pumped back into research, thereby promoting further research.