ISOPTT: Increasing the SMEs Own Potential for Transnational Technology Transfer

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Success Cases: Intellectual Property Rights issues

The Situation

C(2) Software Ltd. was established in 1997 by Finlay Carmichael and Steven Carnegie as a software services company. Initially it developed bespoke software solutions for client companies with the developed IPR retained by the client. The company has since transformed its business model using a product oriented strategy and believes that its philosophy of building its intellectual asset base is key to the success of the business.

The Strategy

About 18 months after establishing the business, the directors were dissatisfied with the pure service model they were operating. Developing bespoke software for clients was a hand-to-mouth existence with no value - beyond the development fee - retained by C(2) Software; all the IPR (Intellectual Property Rights) developed in each contract was handed over to the client. It became apparent to C(2) Software that not every client was interested in retaining the IP and often were more concerned by price, so long as they had adequate rights to use the solution developed. The company saw the opportunity to develop its own product with all the IP held internally and to reap the benefits that may be derived from this. Initially developed as an e-Business platform, the new product grew into an Enterprise Content Management system, Activedition. Other products were developed but Activedition is the mainstay and has helped transform the company. It now develops solutions for clients based on their Activedition product, with all IP retained. In this way, each development contract expands and extends the product. In some instances, where Activedition is integrating with a clients legacy systems or back-office systems and it is not possible to integrate the code developed into Activedition, C(2) Software still retains the IP of the glue binding the systems together.

The Company aggressively pursues exploitation routes for its intellectual assets, through licensing to resellers as well as end-user customers. One major and one minor release of Activedition have been performed in each of the last four years, providing a clear upgrade opportunity with regular improvements. C(2) Software has successfully used their products to leverage other business, -training, support and services such as maintenance contracts- providing revenue streams that extend the business opportunity afforded by each customer and reseller.

In order to ensure the highest possible reputation in the marketplace, C(2) Software has developed detailed and comprehensive, as well as copyrighted, training manuals which they, in addition to using themselves, sell and license to partners and resellers. Through this they emphasise the high quality of their brand and have established themselves higher in the value chain. Logos and marketing materials are carefully controlled and protected by the company. Resellers and channel partners are supplied with marketing materials with all the rights held by the Company, further enhancing and protecting the brand image. The company actively builds its intellectual asset portfolio with the strategic aim of using this for its growth in the future. To extend the reach of the business, other products have been developed with others in the pipeline. Some of these have not proven successful but the Directors view innovation as being central to the future growth and success of the company and their expertise and innovative capabilities can be considered as other intangibles in the business.

The Success

Through productising their primary service offering and building an emphasis on training and high quality partner delivery, C(2) Software has although still a small company elevated itself from being a Scottish software business to being recognised as a UK-wide player. This is best demonstrated by the Companys client list which includes major UK and US organisations such as the Royal Mint, Herbalife and dozens of others. Many prestigious companies only want to deal with the IP holder and not a reseller of others IP. These companies are open and receptive to C(2) Software because of its IA-centric strategy. The Company is now seeking new distribution partners in the European and North American markets and is confident of future success because of the strengths and the IA in its products and their knowledge of doing such deals.


ISOPTT: Increasing the
SMEs Own Potential for
Transnational Technology