Licensing: What It Is and How It Works

The licensing business model involves granting third parties the right to use intellectual property in exchange for payment. Rather than creating and exploiting the intellectual property itself, the focus is on monetizing these rights. Here are the key points:

• Intellectual Property (IP): Licensing typically applies to various forms of IP, including patents, trademarks, copyrights, and trade secrets.
• License Agreement: The licensor (owner of the IP) and licensee (third party) enter into a license agreement. This agreement outlines the terms, conditions, and scope of usage.
• Types of Licensing:
  • GST Licensing: Companies license software to other businesses or end-users.
  • Labour/Factor Licensing: Companies allow their brand name or logo to be used on products by other manufacturers.
  • Factory Planning: Patent holders grant others the right to use their patented inventions.
  • ESI Code: Publishers license content (such as articles, images, or videos) to other platforms.
  • PF Code : Publishers license content (such as articles, images, or videos) to other platforms.
  • Poluction control Board Code : Publishers license content (such as articles, images, or videos) to other platforms.
  • Shops and established Lincin : Publishers license content (such as articles, images, or videos) to other platforms.
  • Shops and established Lincin : Publishers license content (such as articles, images, or videos) to other platforms.
• Benefits:
  • Revenue Generation: Licensing generates income for IP owners without directly producing goods or services.
  • Market Expansion: Licensees can expand their product offerings using established brands or technology.
  • Risk Mitigation: Licensees reduce the risk of infringement by obtaining legal rights.
• Examples:
  • Disney: Disney licenses its characters (e.g., Mickey Mouse) for merchandise, theme parks, and media.
  • Microsoft: Microsoft licenses its Windows operating system to computer manufacturers.
  • Music Licensing: Musicians license their music for use in films, commercials, or streaming platforms.