Intellectual property rights and patents are great assets for many companies and procurement are at least partial stewards of them. They are often attractive assets of course (even from just a sales/marketing perspective), but they are sometimes open to legal disputes – more about this later.
In the case of procurement solutions, competing vendors have material legal exposure – in part because there are so many competitors in the sector that have filed for protections with the US Patent Office. Moreover, end customers (i.e., procurement organizations) should care as well given potential vendor/supplier risk and need to implement (forcefully, especially in the case of SaaS) workarounds based on court judgments if licensing agreements do not occur (and the losing party has to cease and desist).
Perhaps most important is the fact that there are competitors out there with patents who aren’t afraid to use them. In court. One of the more avid patent collectors is Ariba (now with deep SAP pockets) who has been adding around six patents per year to their IP portfolio.
As of late, Ariba and SAP have been relatively quiet on the legal front – although Ariba and Coupa are still slugging it out at the moment over a lawsuit that Ariba filed years ago. That aside, what exactly do those patents cover – and what might the impact be?
We’re digging into these issues in a series on Spend Matters Plus – we think you will be surprised! In the first research brief we looked at some of Ariba’s patents that touch on transformational price factors in auctions, P2P shopping experience, and business network supplier profile management. So far, we think those patents alone should keep quite a few competing providers up at night.
Assuming they are enforceable of course.