Manufacturers Losing Profits From Compromised Intellectual Property Rights

Dec. 19, 2006
Almost half of survey respondents report lost market share.

Over the past two years, two-thirds of manufacturers surveyed reported an increase in the threat to their product intellectual property rights. An Aberdeen Group study, "The Protecting Product Intellectual (IP) Property Benchmark Report: Safeguarding Design IP in a Global Market," examined common practices used in global design and manufacturing including unsecured emails and engineering documentation.

"Among companies benchmarked, 48% report lost market share, 44% lost sales, 30% product commoditization and 27% lower margins because of compromised product IP. In response, over two thirds are actively pursuing improved product IP protection, with almost one third viewing this as a top-five business priority," explained study author Jim Brown, vice president of product innovation and engineering.

The Aberdeen report noted that leading manufacturers are developing multi-faceted IP protection systems including IP friendly collaboration, documenting IP discovery, legal protection and enhanced data security.

"Manufacturing companies are increasingly recognizing data protection of CAD files, engineering data and related information is a key component to surviving and thriving in this highly competitive world marketplace. Research and product development is very costly, and that investment can be whisked away by data piracy. Continuous protection of valuable product IP and ideas allows companies to conduct their normal course of business with confidence," states Darryl Worsham, president of Pinion Software, an Austin, Texas-based provider of security standards solutions.

The Aberdeen report is available at

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