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Why is freedom to operate study a must for technology companies?

Before launching any product, companies conduct market research to ensure that they have a successful product.

Companies may have different reasons to conduct market research, which may include:
a)      Analyze if there is a need for their product
b)      Identify a market for the product
c)      Study competition
d)     Device a marketing plan
e)      Come up with pricing strategy
While, market research is an essential step, an equally important task is finding out if the product has Freedom to Operate (FTO).
Now you may ask, if this has got anything to do with obtaining a licence from the government authorities. Well, this has nothing to do with that. FTO is related to finding out if your product infringes upon the patent rights of others. If it does, you may want to strategize the launch of your product based on that.
So what is Freedom to Operate or FTO and why should you bother about it?
FTO in simple words is the freedom to commercialize a product/process without infringing (our article on infringement: Is my product infringing on others patents) on others patent rights. Commercialization of infringing products may lead to expensive law suits. Hence, a FTO study is an essential task to be carried out before commercializing a product.
How is a FTO analysis conducted                     
It shall be noted that patent rights are territorial. For example, if someone has a patent over a specific type of “pen” in the US and not in UK, then one can commercialize that “pen” in the UK without infringing on the US patent. Hence, a FTO study for a product/process is specific to a territory and considers patents in that territory. So, if you want to find out, whether you have the freedom to operate in US, the relevant patents in US will be taken into consideration.
To find out if your product is infringing on the patent rights of others in a specific country, a search has to be carried out to uncover all the relevant patents in that country. This search will consider granted patents and patent applications (not granted yet) into consideration.
Now you may ask, why consider patents applications which have not yet been granted, and how can you be infringing upon such patent applications. Well to answer your question, a published patent application may be granted in future, and once a patent is granted, they will have the right to sue somebody who has infringed upon their patent rights.
Why carry out Freedom to operate search and what other advantages can you gain from it.
Freedom to operate search should be preferably carried out at an early stages of product development, so that you do not incur huge development costs in developing potentially infringing products and are not entangled in a legal battle later, on infringement charges.
A Freedom to operate search helps in many ways; some of them are listed below:
  1. Will minimize the risk of getting sued by others, for having infringed upon their patent rights.
  2. Such a search will also dig out patents, which have expired (in most countries its 20 years). There may be many useful technologies which can be used from these expired patents.
  3. You will find a list the patents which are relevant to your product/technology and helps you craft strategies, such as:
·         Purchasing patents which are relevant to your product, so that you gain freedom to operate rights in that territory
·         Obtaining a licence from the patent holder for a specific duration of time by working out a payment option. This will give you the right to operate without infringing on others patent rights.
·         If you do have a patent of your own, you can also try the approach of cross licensing of patents to gain mutual benefits.
·         Redesigning your product in such a way that it does not infringe upon others patent rights.
·         Try and invalidate the patents in question so that you gain freedom to operate in the concerned territory.
In conclusion, FTO analysis is a step every technology company should take before commercializing their product to avoid expensive law suits and gain knowledge about the strategies that can be adopted to obtain FTO in their desired territory.
Please feel free check our patent services page to find out if we can cater to your patent requirements. You can also contact us to explore the option of working together.
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Best regards – Team InvnTree