The business of IP: it ain't a bake sale

By Peggy Aycinena
edadesignline.com (July 22, 2009)

IP vendors have long maintained that theirs is a product business model. In the face of rising complexity and shrinking geometries, however, selling IP may no longer be about baking up a plate of brownies, sealing it in shrink wrap, and putting it out there for sale.

IP is about creating a core of some sort, finding someone who needs the approximate features of that core, and then working closely with the customer to tune, tamper, and tweak it, until it fits exactly into a design. That requires services, and services are never shrink-wrapped.

The IP business model is not just about products today; it's a hybrid of product and services. But for every IP vendor who admits to the hybrid model, there's a baker's dozen out there who still swear they only do products, with just a dollop of service thrown in for good measure. Do these guys need to wake up and smell the baking powder?

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