Prince: A Valuable Musical Legend

Many talented musicians have made their mark in the music industry—some more famous than others. However, few have reached the caliber of the world-renown musician known as Prince. Born on June 7, 1958 as Prince Rogers Nelson, Prince began his music career at the young age of 17. Since his early start, Prince’s talents and mark on the industry became widespread over the years, making him a musical icon. Fans loved his mysterious personality and eccentric style. Fellow musicians applauded his musical talents and his efforts in gaining rights to his own recordings.

Prince offered many talents to the entertainment world. Although most widely known as a singer, he was so much more. He was a performer, delivering mind-blowing concert tours. He was an instrumental genius, playing most of the instruments in his first five albums. He was a composer, producer, dancer, and even an actor, earning an Academy Award for his role in the movie “Purple Rain.” While he exhibited many talents, perhaps his biggest and most gifted was his songwriting. Not only did he write his own songs, but he wrote songs for many other musicians such as Alicia Keys, Stevie Nicks, The Bangles, Madonna, and Cyndi Lauper. He loved writing songs so much that he had a vault filled with unreleased music—enough to release an album every year for the next century.

If there were any question about Prince’s success, proof existed in his net worth of $300 million and the many accolades he received through the years. In 2004, he was inducted into the Rock and Roll Hall of Fame. He won a Golden Globe, seven Grammy awards, and an Academy Award. Not only did he receive many awards, but he also boasted an impressive discography of 39 studio albums, 3 live albums, 6 compilation albums, 17 video albums, 136 music videos, 13 EPs, 97 singles, and 1 remix album. At the time of his death on April 21, 2016, Prince had sold more than 100 million records, placing him among the top-selling artists in history.

Even in the event of his death, fans will still purchase his work. In fact, when a beloved musician dies, it is not unusual for his or her record sales to climb shortly after death. People rush to the store to purchase albums in remembrance and to nurse the ache a loss often brings. This is especially true for untimely and unexpected deaths such as Prince’s. While his record sales were not at the height of his career at the time of his death, his death spiked sales by a tremendous amount. In fact, the weekend after he died, album sales reached 399,000 albums, which was a 16,000% increase from the previous weekend.

Many famous musicians, such as Elvis Presley, Michael Jackson, Whitney Houston, and others, continue to bring value to their estates posthumously. Prince will be no exception. His published works and the royalties from songs he wrote for other artists will continue to provide value.  However, Prince’s massive unpublished catalog sets him apart from other deceased artists. Potentially, fans around the world could hear new Prince songs for decades to come, which could make his copyright portfolio one of the most valuable in history after the death of an artist.

Factors That Define Patent Quality

Determining the quality of patents can be a cumbersome task as many factors influence their quality. While patent quality is subjective, it is an important measure in the valuation process. In order to deliver proper patent valuations, an IP analyst must understand the true qualitative aspects of patents.

Factors that influence patent quality are numerous, with various influences including patent strength, breadth, and interest. The following are just a few examples of factors that IP analysts must consider when determining patent quality for a proper patent valuation.

  • Patent prosecution by attorney or agent. An attorney or agent may better understand how to construct claims that will withstand litigation in comparison to an inventor who constructs claims.
  • Number of dependent and independent claims. Patents with a high number of both claims describe more potential inventions and variations.
  • Patent prosecution process. Patents that undergo numerous office actions and claim rejections forces the applicant to refine the patents. The more refined the patents, the less likely they are to face post-grant validity challenges. Therefore, the more exhaustive the patent prosecution process, the higher the quality of the patents.
  • Patent assignments. Arm’s length patent transfers indicate that patents may have quality. Many times patent owners transfer patents among various entities of interest or among entities that they may own. However, when patent transfers occur between patent owners and entities in which the patent owners do no have a vested interested, then the entities’ interest in the patents implies that the patents have some value, which may indicate patent quality.
  • Maintenance fee payments. Companies that pay recurring maintenance fees on existing patents suggest that they find value in them.
  • Prior art disclosure. Substantial prior art disclosure implies the applicant has a deep understanding of the patent space. It also implies that the applicant considered prior art while drafting the patent application. Also, an examiner considers relevant prior art when reviewing a patent. Therefore, it may be harder to challenge the validity of granted patents with an abundance of prior art disclosure.
  • Post-Grant challenges. Patent assets that survive post-grant challenges such as inter partes reviews and ex parte reviews indicate higher patent quality. Patents that survive such challenges become less susceptible to subsequent challenges. Such successes also further assure patent validity over prior art.
  • Infringement wins. Patent owners who assert their patents and win infringement cases prove their patents have good quality. Proof exists in such cases because the patents do not become invalidated despite the efforts of accused infringers to do so.

As you can see, numerous factors exist that IP analysts must consider when determining the quality of patents. However, even with the highest quality patents, if the market does not believe the invention provides utility superior to others in the market, then the patents may have little value. Therefore, while patent quality is an important metric and one that must be considered by an IP analyst, it is only a small part of the larger patent valuation process.

Companies With the Most Patent Activity

Patents provide companies exclusive rights for a fixed period in exchange for the disclosure of an invention. They represent the legal right to exclude others from the market. This enables patent owners the ability to charge higher prices for a particular invention. Patents also provide protection in the event of willful infringement.

In patent lawsuit history, some cases have amounted to more than $1 billion in awarded damages. Such technologies that warranted the highest amount of awarded damages since 1995 involved the following: arthritis drugs, MP3 technology, noise reduction on circuits for disk drives, smartphone software, genetically modified soybean seeds, an operating system, vascular stents, an Internet browser, drug-eluting stents, and a device measuring blood oxygen levels. As indicated, patents protect a wide range of technologies. Without patent protection, the companies that prevailed in these cases would not have had the necessary tools to receive the awarded damages that they did.

This is one of the reasons that patent activity continues to increase each year. Some powerful companies are extremely aggressive with their patent filings. The following ten companies experienced the most patent activity in the last year. The patent activity total includes the number of grants and the number of patent applications from April 1, 2015 to April 1, 2016.

1.   IBM with more than 14,000.
2.   Samsung Electronics with more than 13,000.
3.   Canon with more than 7,600.
4.   Qualcomm with nearly 6,000.
5.   Toshiba with more than 5,700.
6.   Google with more than 5,500.
7.   LG Electronics with more than 5,200.
8.   Intel with more than 4,500.
9.   Sony with more than 4,400.
10. Samsung Display with nearly 4,000.

Not surprisingly, the top companies are technology companies. In the technology world, it often takes many parts of various inventions to make up one functional invention. For instance, smartphones offer a variety of options (e.g., screen unlock swiping mechanism, the design of the phone, etc.) that stem from inventions developed by various companies. Therefore, a smartphone may embody thousands of patents in order to make it a functional phone. In fact, hundreds of thousands of patents impact smartphones today. This is why there are constant patent wars between smartphone manufacturers. In order to stay competitive, these companies must arm themselves with the protection needed to win the constant battles that arise in this industry. Thus, technology companies are likely to remain the top companies in patent activity for a long time.