The income or net present value (NPV) approach is based on the cash flow that results from introducing the covered technology to the marketplace. The intellectual property value as calculated by this method is the present value of the expected future income stream. The theory behind this approach is that the licensee will [...]
The cost method is based on the licensor’s investment in the technology. The cost approach is based on the economic principle of substitution. An investor will pay no more for an asset than the cost to develop or obtain another asset of similar utility. The value of the intellectual property is equal to [...]
When considering valuation methods for patents and portfolios there are some fundamental concepts that need to be understood. Fair market value is one of them. Fair market value is defined as a price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to [...]
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