IPBlog often discusses the many micro-economic needs for credible IP valuations. In a fascinating discussion, South Africa’s Alan Lewis, president of Licensing Executives Society International, promoted attention to IP management at the macro-economic level. In a mid-month presentation to members of the Licensing Executives Society Philippines, as reported in the Philippine Daily Inquirer, Lewis noted that almost all countries in the world keep a balance of payments on royalty accounts for IP, measuring inflows and outflows.
The U.S. sports the largest IP trade surplus in the world, receiving $92B in royalties and paying out just $26B. Lewis contends the U.S. experience demonstrates how IP can support a country’s economy.
While admitting there are no hard-and-fast, one-size-fits-all rules to IP valuation, Lewis advocated a uniform approach be taken to IP valuation to enable a country to better take advantage of this resource.
“If you have something, but don’t know what it’s worth, do you really have anything? You may have a big chunk of diamond, but if you don’t know its value, it’s not worth anything at all to you,” Lewis said. “From a strategic point of view, you have to know the value of what you develop for you to be able to better channel your resources. You have to have a realistic assessment (of your IP).”