Volvo Cars’ new IP head looks to turn iconic brand into a powerful patent player 06 Apr 18
Of all the industries to have re-shaped the way they approach IP in recent years, arguably none has gone through as fundamental a change as the auto sector.
Many of the leading manufacturers, such as Ford and Toyota, have become far more sophisticated IP players, building portfolios to rival all but the largest tech giants in size terms. Others may be coming later to the party, but there are few car manufacturers that aren’t actively considering how the forces of convergence and profound technological change in areas like autonomous driving will impact them from an IP standpoint.
Volvo Cars, created in Sweden and acquired by China’s Geely from Ford in 2010, falls firmly into that second category. It signalled its intent to undergo an IP evolution with the hire earlier this year of former GE IP executive Ray Millien as global chief IP counsel.
Millien’s move was in part prompted by the merger between his previous employer, GE Oil & Gas, and Baker Hughes. With the general counsel role at the combined company due to be taken by the Baker Hughes legal head, and with Millien assuming that the position of IP head would also go a legacy Baker in-houser, he took a severance package; then, after a brief spell consulting, landed the Volvo job (you can see a short piece on Millien and his move by recruiter Adamson & Partners here).
Although he has very limited experience of the auto sector Millien says he has a strong affinity with the Volvo brand, in part because a relative always claimed that it was because he was driving a typically robust Volvo that he survived an accident he was involved in on a New Jersey road back in the day (Millien’s relative is not the only one: Volvo famously gave a free licence to all auto manufacturers to use the patent underpinning the three-point seat belt invented at the company back in the late 1950s on the basis that it was just too important to keep to itself).
Recently ensconced in the company’s Gothenburg HQ, Millien took some time to speak to IAM to discuss his move and talk about his priorities in the role. His mandate is focused on three main areas: build an international IP function (currently the whole group is based in Gothenburg), strengthen the company’s portfolio; and turn the IP group from a cost centre into a profit generator.
Millien is currently responsible for an IP team of nine, although he says that he is actively looking to expand with four or five roles to fill in Asia, the US and Europe.
In portfolio terms, Volvo is a relative minnow with fewer than 1,000 patent families. That is in part a reflection of the fact that after its acquisition by Ford in 1999, responsibility for and ownership of Volvo IP transferred to the US car giant’s Michigan HQ. That means that the company has only been back in full control of building its IP asset base since 2010.
Plus there are local habits that Millien says can act as a natural brake against filing. “In Scandinavian cultures modesty is very important and that means that innovation doesn’t always translate into filings,” he says.
Although Millien admits that changes to the legal climate in the US mean that IP is probably “right now a little more valuable” in Europe, he says that the company’s organic portfolio growth is still firmly focused on filings in the US, Europe and Asia. The IP ecosystem is subject to “ebbs and flows” he says before adding: “At the end of the day, good IP is going to be valuable and that’s the standpoint that I start from.”
As he looks to increase the company’s number of grants, Millien stated that he is looking not only at organic growth but also acquiring rights on the secondary market.
Arguably the toughest priority is the brief to turn the IP group from a cost centre to a contributor to the bottom line. In an industry where IP relationships have historically been focused on a complex web of cross-licensing deals between manufacturers and a long line of suppliers below them - something which emphasises a collaborative approach - turning patents into profits is hardly straightforward.
On top of this, while the Volvo brand has been going through something of a renaissance since its acquisition by Geely, it is still very much a newcomer to the IP game.
Millien, though, is undeterred. “It’s all about ensuring that you have the right personnel and infrastructure in place and devoting resources to analysing your portfolio,” he remarks. “In their roles a lot of CIPOs have to look forward, to what’s coming next, but to monetise you have to look back to what you filed in previous years.”
Although he doesn’t have experience of the auto sector in his previous roles, Millien suggests that there are parallels with both the oil and gas and the healthcare sectors that he focused on while at GE. “I’m not finding it all that different,” he comments. “In each of them you have the large players, plus start-ups and a lot of private equity money flooding the market.”
The convergence of different technologies into new cars, the entrance of new players such as Tesla into the market and the rise of autonomous driving all point to a far more litigious climate in the auto sector. This is something which Millien says he’s conscious of. “I’m definitely aware of that and preparing for it,” he comments. “Someone will strike first - whether it’s an OEM, a start-up or an NPE - we’re definitely not deluding ourselves that this is a sleepy industry.”
Might Volvo turn to litigation to enforce its own rights? “That option is always on the table,” Millien admits. “The fact they hired an American IP lawyer should tell you a lot.”
Be it in the courtroom, in the patent acquisitions market or through its recruitment, the company looks set to become a far more active IP player in the rapidly evolving auto industry.
Ray Millien is a speaker at Auto IP Europe, taking place in Munich in 18th May.
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