2009-06-23

INTANGITOPIA SPECIAL REPORT

R.I.P. OCEAN TOMO: COMPLETE AUCTION ANALYSIS

BY: MARCUS MALEK

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STATUS QUO

• Ocean Tomo sold it’s auction business mid June 2009 for 10 MUSD

• Many believe this to be a sale of ”distressed assets” after disastrous auction in spring 2009.

• Here follows a complete analysis of their 8 completed auctions until fall 2008.

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WHAT IS INTANGITOPIA:

”INTANGITOPIA IS A KNOWLEDGE PLATFORM INITIATED BY AN INTERDISCIPLINARY

GROUP OF 5 GRADUATE SCHOLARS. OUR PRIMARY FOCUS IS ON THE USE OF THE

LEGAL, FINANCIAL AND TECHNICAL ARENAS TO LEVERAGE INTELLECTUAL ASSETS,

PROPERTY AND CAPITAL; IN THE LIGHT OF THE EMERGING KNOWLEDGE ECONOMY”

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OCEAN TOMO OVERVIEW

•  First auction held spring 2006. •  In total 9 auctions until spring 2009. •  Vast majority of auctioned lots were

patents, from individuals and BigCo. • OT’s auction business is a pioneer. •  Sold in June 09 for 10 MUSD to ICAP. • OT’s divestiture is a major stir in

emerging IP market place.

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PURPOSE OF THIS REPORT

• Give an objective view of OT performance.

•  Analyze all sold lots in order to find patterns and trends.

•  Statistical overview like this sheds light on whether public auction model is suitable for the IP marketplace.

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METHODOLOGY

•  Sales figures for all sold lots until fall 2008 auction have been gathered.

•  In addition, metadata and aggregated statistics have been calculated.

•  All data is public and from official Ocean Tomo source.

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TAXONOMY AND DISCLAIMER

•  All sales prices are in USD • Only US patents are part of analysis •  Technology clustering is subjective

and not always according to OT •  Expected value is given by seller to

OT (if there is spann, lowest is used) • Only patent lots are analyzed •  Post-auction sales are not analyzed

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HI-LEVEL STATISTICAL OVERVIEW

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HI-LEVEL STATISTICAL OVERVIEW

•  84,7 MUSD generated at auctions. •  41% of offered lots got sold •  Average lot has 2,11 US Patents and

costs 322,281 $ •  90 lots sold by individuals •  75 lots for less than 100,000 USD •  Avg. Gap between expected- and

sale price; 336 145 USD or 878%

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SALES OVER TIME / SALE NUMBER

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DIFFERENCE % (EXP - PRICE) OVER TIME

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DIFFERENCE <1000% OVER TIME

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STATISTICS OVER TIME

• Dramatic drop over time for ”gap” between expected and sale price.

• No clear timing for high or low price sales and only slight upward trend.

•  First auction posted enormous ”gaps” • When taking away extrem

”gaps” (>1000%) picture is more homogenous over time.

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PER AUCTION STATISTICS

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PER AUCTION STATISTICS

• No clear trend can be seen •  Spring 2008 (#6) stands out with

strongest lot sale % (61,6) and total sales 19,6 MUSD.

•  Summer 2007 (#4) has highest avg. lot price, 650 kUSD, lowest gaps (49%), but lowest lot sales (22%)

•  1st auction: avg. 0,55 MUSD gaps

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TOP TEN SALES

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TOP TEN SALES

•  Top lot, 6,6 MUSD, was 34 patents, yielding only 0,2 MUSD per patent

•  Top Single patent; 4.9 MUSD • No clear trend among technologies

other than all being electronics / ICT •  Top ten has 5 single patent lots • No blue chip company in top ten, but

two individual sellers.

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KEY TAKEOUTS

• No clear trends and great variance in all metrics

• Gaps between expected and sale price are much higher than expected.

• Only 16 lots sold above 1 MUSD • No blue chip companies in top ten • Only ICT / electronics in top ten

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IMPLICATIONS FOR IP MARKETPLACE

•  Auctions come with much uncertainty • Good platform for indivudual

inventors and small clusters, under 0,5 MUSD.

•  Auctions do not seem to be the model for blue chip or larger hi-value transactions

•  Seller price expections are too far from sale price for sustainability,

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THANKS FOR YOUR INTEREST!

This report was compiled by: Marcus Malek http://www.twitter.com/marcusmalek http://www.linkedin.com/in/marcusmalek

For questions or comments: marcus[dot]malek[at]gmail[dot]com

Please visit INTANGITOPIA.COM™ for more insights and thoughts on IP and innovation

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