Intellectual Property Strategy

Epson's Intellectual Property Strategy

Epson operates under a proactive intellectual property policy. Our intellectual property strategy is closely aligned with Epson's management, business, and development strategies. We engage in forward-thinking acquisitions of intellectual property rights and actively utilize our intellectual property rights and other IP assets in support of the growth strategy scenario.

Epson's intellectual property strategy is characterized by the features below.

Epson's Intellectual Property Strategy Execution Organization

The Intellectual Property Division is headed by a general administrative manager. The general administrative manager meets one-on-one with the chief operating officers of each operations division and with the general administrative manager of the Technology Development Division in planning an IP strategy in alignment with business and development strategies for protecting our unique core technology and brand name. When necessary, the president will join these meetings.

During these meetings, the parties cover a range of topics. They discuss leveraging tools like IP landscapes for multidimensional investigation and analysis of technical, business, and intellectual property information to facilitate innovation support. They examine acquiring and utilizing intellectual property rights (such as patents, designs, and trademarks) to provide robust support for business and development strategies. They also address topics like digital transformation and co-creation support, as well as brand support. The aim is to report on and discuss these topics in order to align the intellectual property strategy with the overall management, business, and development strategies. The IP strategy is periodically reported on and discussed at the board of directors meeting, and the results of these discussions are reflected in the strategy. At its most recent meeting, the board of directors reaffirmed the direction of IP activities aimed at realizing Epson 25 Renewed based on the efforts to date to support the creation of new businesses. Through such close-knit communication with upper management, Epson's IP strategy is configured to quickly adapt to highly uncertain and rapidly changing business environments.

The integration of business & development strategy and IP strategy

This close collaboration among management, businesses, development, and the intellectual property organization is a hallmark of Epson's IP operations and an advantage when it comes to formulating intellectual property strategy that is in lockstep with development strategy and business strategy.

We aspire to achieve sustainability and enrich communities. Toward this end, we carry out intellectual property activities based on multiple interconnected strategies. Our intellectual property acquisition strategy is aligned with our business and development strategies for protecting our brands and the core technology from which we draw our strength. Meanwhile, our strategy of utilizing intellectual property rights is founded on the growth strategy scenario and is aligned with our business and development strategies, which are geared toward solving societal issues.

Rights Acquisition Strategy

Epson takes a proactive approach to intellectual property. We are building an intellectual property portfolio by anticipating what lies ahead and, before others, strategically, efficiently, and effectively acquiring the rights to various types of intellectual property, such as patents, design rights, and trademarks. Epson defines outstanding patents that elevate our competitive advantage and that help to support the growth strategy scenario as "BP" (which stands for "Brilliant iP" or "Brilliant Patents"). We are pursuing the strategic acquisition of BP in accordance with key goal indicators (KGI) set in the IP strategy. There are two categories of BP: "BP-F (fighting)" and "BP-G (guard)." A BP-F is a right that is known to be practiced by other companies and that can be utilized in the future to secure the flexibility in business operations. A BP-G is a right that significantly contributes to safeguarding the business.

Epson strategically acquires "BP" based on its intellectual property strategy and integrates them into various utilizations.

At the heart of Epson's rights acquisition strategy is the filing of patent applications for inventions that accompany technology development and the acquisition of those as patent rights. Epson ranks among the world's leaders in the strategic filing of patent applications in technology fields such as inkjet printers, piezoelectric printheads as components that eject ink, projectors, robots, watches, and crystal devices. Through these world-wide top class, strategic filings of applications, Epson has built an industry-leading intellectual property portfolio, safeguarding its proprietary technologies.

Ranking of patents by technical field

Epson's 2022 patent registration ranking (per Epson research & excluding Chinese utility models)

Rights Utilization Strategy

Epson anticipates the future and proactively utilizes intellectual property rights, including BPs, in support of the growth strategy scenario. The strategy for utilizing our intellectual property portfolio is depicted in a four-quadrant chart that shows how Epson implements its patents on one axis and how our competitors implement their patents on the other axis. We formulate our intellectual property utilization strategy based on this chart, which we call a "C-Curve."

Exercising Rights Along a "C-Curve."
  1. 1. Non-licensed quadrant:In-house implementation, no implementation by other companies

    Epson acquires and protects rights to core technologies that are a source of competitiveness and does not grant licenses to others.

  2. 2. Cross-licensing quadrant:In-house implementation, implementation by other companies

    Epson tries to ensure business flexibility by entering into cross-licensing agreements with competitors who want to use our rights.

  3. 3. Selling and licensing quadrant:No in-house implementation, implementation by other companies

    Epson monetizes rights that have contributed to the growth of business through cross-licensing agreements but are no longer essential by either selling or licensing the rights to others.

  4. 4. Abandonment and expiration quadrant:No in-house implementation, no implementation by other companies

    Maintaining rights is costly, so Epson actively abandons rights that are unlikely to be productive.

Apart from this, Epson also utilizes its intellectual property portfolio in brand support.

An Intellectual Property Strategy That Supports Sustained Growth of Corporate Value

Epson aims to sustain the growth of corporate value by leveraging its intellectual property to create a positive cycle for new businesses and convert intellectual property into corporate value. That is why we engage in activities that support innovation, co-creation, digital transformation (DX), and our brands based on intellectual property.

(1) Innovation support

IP Landscapes that guide business and development strategies

In addition to utilizing our own intellectual property to maintain a competitive advantage, we have begun to combine our IP with that of other companies in an effort to create new businesses. An IP landscape is a comprehensive analysis of technology development trends within a certain field. It shows what each company is doing in that field and what Epson's strengths and weaknesses are in that field in terms of technology development. Epson uses IP landscapes to identify areas where it should be active and to guide its technology development.

As part of these activities, when a decision is to be made about investing in a startup, the Intellectual Property Division evaluates the intellectual property owned by the startup. The diagram on the right depicts an example appraising the patent portfolio held by Neurable, Inc., a startup engaged in Brain Computer Interface (BCI) technology development utilizing brainwave analysis. The portfolio was seen as having high value compared to the portfolios of its competitors. In April 2023, Epson X Investment Corporation, a corporate venture capital (CVC) subsidiary established by Epson, made the decision to invest in Neurable based in part on this assessment of the value of the startup's intellectual property.

Patent Asset Index graph

Created by Epson using LexisNexis PatentSight.
The patent asset index is a metric used to assess the total value of a company's patents.

(2) Co-creation and DX support

Contractual support for building a co-creation scheme with partners

Rather than doing everything independently, Epson 25 Renewed, our corporate vision, emphasizes co-creation, a process in which new value is quickly created with partners who share our vision and want to work with us to accomplish it.

To smoothly advance co-creation, Epson and its partners need to put in place a business framework that benefits both parties. However, the treatment of intellectual property generated through co-creation can become a contentious issue, particularly when partnering with startup companies, and this can hinder innovation and co-creation.

We are thus putting in place the organizational support needed to expedite co-creation. Specifically, we have formed a dedicated team to support the process of drafting technology license agreements. From the moment we start exploring potential co-creation partnerships, the team will be on hand to provide one-stop support.

In recent years, we have been more deeply exploring data utilization businesses that leverage data, which is a valuable intellectual property, and businesses that utilize rapidly evolving AI. Given this, we have been categorizing data utilization businesses and AI utilization businesses, along with the type of contractual agreements for each, to enable us to more quickly execute agreements with relevant stakeholders based on these categories.

Categories of Data Exploitation Businesses

(3) Brand support

Brand promotions that use an IP mix (sales & marketing support)

Epson uses a mix of intellectual properties to support its brands. This is a distinguishing feature of how Epson utilizes its IP rights. Epson believes that building a brand requires (1) uniqueness that differentiates the brand from the competition, and (2) constancy and continuity in conveying a consistent brand concept to customers.

(1)Epson emphasizes the uniqueness of its product technology and designs in promotions and highlights the fact that they are protected by IP rights.

(2)Epson acquires trademark rights for its innovative technologies and unique designs and creates technology brands and design brands around them. It uses these to continuously communicate a consistent message about the brand concept to customers.

ip mix