Former senior IP executives at some of China’s biggest tech companies have come together to form a business designed to feed into the country’s growing appetite for high-level strategic IP services.
Hugo Wang, the former head of IP at Tencent, is the CEO of Shenzhen-based TECHVISUM and leads a team which includes Fushan Li – former IP director of Skyworth; Jianfeng Shen – former IP director of ZTE; Zhanghui Huang – former general manager of IP and legal at BYD; and Shizhan Guo – former director of global law, IP and information security affairs at Huawei.
Although we have seen the emergence of several top level IP consultancies in other parts of the world over recent years – Sherpa Technology Group and Quatela Lynch McCurdy in the US spring to mind – this looks to be a first for China. With such a team of senior operators, TECHVISUM looks well placed to offer services at the highest corporate level – having the contacts, experience and the knowledge to talk to corporate heads of IP and the C-Suite. As IP grows ever-more important in China, this level of expertise is only going to become more in demand.
However, the firm also has a lot more in mind – with brokering and defensive aggregation also figuring in its plans. Above all else, TECHVISUM's emergence shows how sophisticated the Chinese market is becoming. Until very recently, top class IP talent in China had two career options: working in-house or in private practice. Now, there is a group of very senior players who can see enough opportunities out there to take a third way. That is significant.
IAM caught up with Hugo Wang to find out more.
How do you describe your firm?
TECHVISUM has about 70 employees. We are currently providing consulting services, but I am not positioning us to do this business alone in the long run. Over a period of time, we will create revenue through consulting services to ensure good management of the company. However, we want to do more patent brokering work and explore business models in China like those of IV and RPX. In the future, we may also look to form and run patent pools.
What do you see in the Chinese patent transaction market?
We see significant potential. The Chinese transactions market is continuously growing and evolving. Demand for patent acquisition is growing strongly in such sectors as new energy, automotive and autonomous driving.
We have six founders who all worked in Chinese major tech companies for over a decade. We have built good relationships with domestic peers and IP executives, and some counterparts from overseas operating companies and service providers. I was head of IP at Tencent for years, and my partners were senior IP executives at the likes of BYD, Huawei and ZTE.
Who are the major patent sellers in the Chinese market?
1) Major tech companies in the US. IBM, is a good example that has been active in divesting some portfolios and making deals. It produces a large number of patents that are sold like ‘products’.
2) Japanese companies that used to be tech giants. They have big stockpiles of patents.
3) Taiwanese companies.
You seem to be very certain that the global IP transaction market will move to China; what are the reasons making you believe so?
First of all, US policy makers are making the overall judicial, legislative and commercial environment less friendly to patent owners and patent monetisation there, so American NPEs have started and will continue to move activities to China.
I think it’s not accurate to say that government initiatives and polices play the most significant role in attracting patent activities and transactions to China. Instead, it’s the demand in the marketplace that plays a bigger role.
Also, more infringement rulings and increasing damage awards will be handed down by Chinese courts. Courts have been ruling fairly, with equal winning rates for domestic and foreign parties.Together these trends indicate a substantial improvement in the Chinese judicial system. All these factors and changes make China appeal to foreign operating companies, NPEs and brokers. Apple and Qualcomm adding China to their global litigation battle is a good example of this.
I believe there will be more cases and rulings handled in Chinese courts this year and in coming years. I also believe more and more legal battles will be fought between corporates, and I would not be surprised to see more litigations in Chinese courts - including Chinese vs Chinese, Chinese vs foreign and even foreign vs foreign disputes. My point is that operating companies will be the key parties involved in patent litigation in China, not NPEs. The latter have been slowly entering China, but it’s still too risky for them to leverage the courts to litigate.
Do you see increased demand for Chinese patents in the market?
I haven’t seen any big deals with a large number of Chinese patents. In general, Chinese companies do not sell patents, except some pharmaceutical companies. In the heated telecommunications field, Chinese companies have a bigger need for acquiring than selling patents. Of course, we know Huawei and ZTE have been selling patents, but those patents are not necessarily top quality assets.