#98 IP Strategy for Quantum Tech Commercialization

00:00:03: Welcome to the IP Market Signals series from IP Management Voice.

00:00:07: Drawing on analyses by the OFB-IP market research group and specific market observations, this series examines developments in industries and technologies... ...and how they are shaping demand for IP related expertise.

00:00:22: In this episode we examine which specific observable market signals are driving the IP related challenges in quantum technology.

00:00:34: You know, when you're looking at like a concept car in the showroom floor under those bright lights.

00:00:40: The design is just absolutely flawless right?

00:00:43: Oh yeah it's pure uncompromised vision of the future

00:00:47: exactly.

00:00:47: but the second you try to take that pristine design and actually mass produce it.

00:00:53: When you have start factoring supply chain bottlenecks safety regulations actual wear-and-tear real highways Suddenly that perfect engineering has to survive the messy reality of the real world.

00:01:05: Yeah, and it's a brutal transition.

00:01:07: It is in that collision between sterile perfection And like high stakes industrial reality.

00:01:13: That is exactly where the quantum technology industry Is sitting right now?

00:01:17: There really is an affriction generated by that collision its completely reshaping The entire landscape of the industry especially behind-the-scenes Where the actual commercial value is secured.

00:01:27: Right.

00:01:28: so welcome to the deep dive.

00:01:30: Today, our mission is to map out exactly how this massive leap from the research lab To the commercial factory floor as creating these These totally new hidden hurdles for intellectual property management.

00:01:41: And we should say right up front since you're listening to This We know You already have a solid grasp on The mechanics of qubits and the basics of IP.

00:01:49: Oh yeah?

00:01:49: We are skipping the one-to-one level definitions entirely today!

00:01:53: You Already Know the Basics...we want to dig into the strategic.

00:01:56: why

00:01:57: Like,

00:01:57: why are the old playbooks for patenting quantum tech suddenly just well breaking down under the weight of actual commercialization?

00:02:05: To frame this whole discussion we're going to look closely at the newly published IP market report.

00:02:10: Which is a fantastic resource by

00:02:11: the way.

00:02:12: It really it's crucial right now because it highlights specific IP challenges in the Quantum sector that our currently going largely unmet by traditional external patent attorneys.

00:02:22: Right!

00:02:23: Because standard advice just isn't cutting it anymore.

00:02:26: Exactly!

00:02:27: And to ground this in reality, we're going look at market observations from seven different authors across the European quantum community will be matching what they are seeing on-the-ground directly to the foundational IP challenges outlined in the IP Market Report.

00:02:39: Okay so let's jump right into it.

00:02:42: Let us start with probably most obvious shift which is pivoting from celebrating scientific milestones and a journal To actually chasing commercial revenue.

00:02:51: The Holy Grail

00:02:53: Right.

00:02:54: Henning Solar recently pointed out this really aggressive push toward commercialization.

00:02:58: He noted the increasing investment flowing into space and crucially, The growing quantum computing revenues.

00:03:05: We are no longer just funding a lab bench.

00:03:07: You know we our funding business models

00:03:09: Which fundamentally changes what a company needs from its IP strategy.

00:03:13: How so?

00:03:14: Well, think about it.

00:03:15: During the research phase your IP strategy is usually centered on protecting a single isolated technical breakthrough like say uh... A novel qubit architecture.

00:03:24: Sure!

00:03:24: You invented you patented-you're done Right.

00:03:27: But as Soler's observations indicate when you pivot to chasing actual revenue Your IP protection has support dynamic business decisions.

00:03:35: The IP market report identifies really major unmet need here which is framing IP advice directly in terms of business consequences.

00:03:43: So it's not just about getting the patent granted anymore.

00:03:46: Exactly, a traditional external patent attorney might focus purely on just getting that piece of paper.

00:03:52: but the market demands knowing what specific rights The company needs to actually control To safely enter a target Market.

00:03:59: how do you differentiate?

00:04:00: The product in the eyes Of a buyer?

00:04:02: the IP has to enable the business model Not Just sit On A shelf.

00:04:06: yeah That Makes a lot of sense and I mean that Push for Revenue inevitably changes the physical footprint of these companies too.

00:04:13: Oh, massively.

00:04:15: Jan Getz recently shared some updates on IQM and he was talking about pitching institutional investors like big names BlackRock

00:04:23: right?

00:04:23: Institutional heavyweights

00:04:25: yeah And he's detailing the build out of heavy physical infrastructure.

00:04:29: We're talking chip factories assembly lines data centers.

00:04:33: But um Actually I'm struggling with a timeline here.

00:04:36: bit

00:04:37: okay.

00:04:37: What's the hang up?

00:04:38: well if i'm pitching black rock They're going to want to see my IP completely locked down before they hand over millions of dollars.

00:04:44: To build a factory, right?

00:04:46: So how can industrial growth be a source of new IP challenges?

00:04:50: if the IP is supposed to be the prerequisite for that growth?

00:04:53: in the first place?

00:04:54: it's kind of like moving from writing an award-winning recipe to running a massive commercial kitchen.

00:04:59: That Is A Great Analogy Actually And It'S The Natural Assumption TO MAKE THAT THE IP IS DONE BEFORE THE FACTORY'S BUILT.

00:05:06: BUT THE REALITY ON THE GROUND IS WAY MORE FLUID.

00:05:09: Okay, so what actually happens?

00:05:12: The initial IP that gets you.

00:05:13: the meeting with BlackRock is usually just that foundational concept car patent we talked about.

00:05:19: But the IP market report specifically flags that industrial scale-up radically expands the pool of intellectual assets a company has to manage.

00:05:26: Oh I see because your inventing new things as you build the factory

00:05:30: Exactly When you build a facility, the valuable knowledge spreads out.

00:05:34: It goes from just the physics of the qubit into like manufacturing yield processes component testing protocols calibration methods system integration.

00:05:44: So The Intellectual Property effectively leaks Out Of The R&D Lab and Just Bleeds Onto The Assembly Line.

00:05:49: Yes

00:05:50: And That assembly line Knowledge Is Often What Actually Makes The Company Profitable.

00:05:54: Wait Really?

00:05:56: Not The Core Qubit Patent.

00:05:58: The Core Patent is Table Stakes But a lot of that execution knowledge on the assembly line isn't even patentable.

00:06:04: It relies heavily on trade secrets, really strict confidentiality protocols and software

00:06:09: rights.".

00:06:11: So it's a governance issue?

00:06:13: Exactly!

00:06:14: The unmet challenge for these scaling companies is internal IP governance.

00:06:19: They have to create an IP narrative that clearly explains, to an institutional investor like BlackRock how this messy unpattended execution knowledge combines with their foundational patents To create a durable competitive edge.

00:06:32: So using the restaurant analogy you have to prove You own the recipe but you also Have to prove you legally control the very unique way your commercial kitchen operates.

00:06:43: spot on.

00:06:44: You have to secure both, To actually have a business.

00:06:47: That distinction is fascinating But you know A factory doesn't run in a vacuum.

00:06:51: Eventually you Have to take this hardware you built And plug it into a customer's legacy workflow To prove that It does something useful

00:06:59: and that introduces The whole new layer of risk.

00:07:01: Right Kevin Berghoff recently wrote about This.

00:07:04: He was discussing the development Of contact-free chip inspection Using quantum sensing And doing this inside tier one semiconductor foundries

00:07:12: which is an incredibly harsh environment for a delicate quantum sensor.

00:07:16: Exactly, he highlighted the brutal reality of taking this lab equipment and forcing it to work within the practical constraints of third-party manufacturing workflow.

00:07:25: Yeah because those foundries I mean they're massive And hold all leverage.

00:07:29: They are absolutely not gonna halt a multi billion dollar production line To accommodate A Delicate Quantum Experiment.

00:07:37: Right!

00:07:38: The quantum tech has to adapt them.

00:07:40: But that's where I see a massive trap.

00:07:44: What do you mean?

00:07:45: Well, let say a quantum startup takes their new sensor into a giant tier one foundry for validation and the Foundries engineers who are brilliant inevitably suggest A crucial tweak to make That sensor fit there existing assembly line.

00:07:58: Who actually owns that tweak?

00:08:00: i mean The start-up brought the sensor but the foundry provided the environment And necessary modification

00:08:06: right There.

00:08:07: That specific scenario is one of the most critical friction points identified in the IP market report.

00:08:12: I knew it had to be a nightmare to sort out!

00:08:15: Oh, It Is... They categorize this as the challenge of IP architecture for joint development.

00:08:20: The Market is demanding real-world validation like you said.

00:08:23: but when you share your proprietary knowledge with a prospective customer and get that validation boom You trigger a massive IP sequencing Challenge.

00:08:31: IP Sequencing?

00:08:33: Okay let's break down.

00:08:35: How does a startup actually sequence its IP so they can survive whiteboarding session with tier one foundry without giving the farm away?

00:08:43: Well, sequencing means you don't just walk into the Foundry with standard boilerplate non-disclosure agreement and start brainstorming.

00:08:51: Which is what everyone wants to do I

00:08:52: bet!

00:08:53: Exactly because their eager to please clients but before meeting even happens have file provisional patents specifically covering anticipated integration points.

00:09:02: Oh wow anticipating where client will ask for

00:09:04: Yes, then you use highly structured tiered NDAs.

00:09:09: These legal fences ensure that the foundry's engineers are only permitted to suggest tweaks at the application layer like maybe how the sensor mounts to the line or how the data is formatted for their servers.

00:09:20: But they can't touch the core tech

00:09:22: Right.

00:09:23: You explicitly bar them from modifying the Core Sensor architecture.

00:09:27: If you fail to sequence those disclosures and filings perfectly.

00:09:31: That innocent

00:09:32: tweak

00:09:32: suggested by the foundry could bleed your core IP into public domain.

00:09:36: Or worse, legally grant the Foundry co-ownership of your foundational technology.

00:09:41: Exactly!

00:09:42: You can end up competing against you own customer.

00:09:44: So rushing to get customer validation without an IP architecture in place is essentially walking a buzzsaw.

00:09:50: It's corporate suicide.

00:09:51: yeah

00:09:52: Man.

00:09:53: and this collaborative friction isn't just limited hardware integration is it?

00:09:57: Sabrina Montescalco brought that up with software and domain expertise.

00:10:02: Oh, the Q for bio program.

00:10:04: Right?

00:10:04: It's this massive collaboration involving algorithmic IBM and The Cleveland Clinic all working together to simulate drug candidates.

00:10:12: And her overarching point was that achieving actual usefulness in quantum right now requires combining Quantum hardware classical software and deep domain expertise.

00:10:23: literally nobody holds All those cards alone

00:10:25: Nobody which leads us straight into the IP market report's findings on consortium-IP architecture.

00:10:31: When you have an ecosystem like that where, say, IBM is bringing hardware IP, Algorithmic is bringing software IP and Cleveland Clinic has Biological Domain IP The right structure just has to be flawlessly calibrated from day one.

00:10:45: I imagine it's a bit... okay Imagine your bring in your proprietary physics engine To build new video game on someone else's console and you're using a third party's character designs.

00:10:56: That is a great way to visualize it!

00:10:58: It's highly collaborative, but who actually owns the specific lines of code written to make your engine talk to their hardware while rendering that character?

00:11:08: Exactly in IP terms.

00:11:09: You have to rigidly define The background IP first...that's the physics engine And console that brought into project before anything started.

00:11:17: Ok the pre-existing stuff

00:11:19: Right.

00:11:20: Then you have to define the foreground IP, which is that new integration code created together during the project...

00:11:26: Makes sense!

00:11:27: ...and crucially, You have to find the side-ground IP.

00:11:32: Side ground?

00:11:32: What's that?

00:11:33: Those are innovations made by one party DURING THE PROJECT but outside its specific scope Like if IBM discovers something new about their hardware while testing algorithmic software.

00:11:43: But it isn't directly related to drug simulation.

00:11:46: Ah, I see.

00:11:48: And if those boundaries aren't clearly drawn,

00:11:50: you end up in post-project commercial gridlock.

00:11:53: You might successfully simulate a breakthrough drug candidate which is amazing for science but terrible

00:11:58: for business

00:11:59: exactly If the consortium IP architecture wasn't negotiated properly upfront.

00:12:04: Nobody has the clear unencumbered rights to actually commercialize The drug.

00:12:08: the validation is totally successful But the business fails because the IP rights are hopelessly tangled.

00:12:13: that is wild.

00:12:15: You can succeed in a lab and still fail on the market just because of the paperwork.

00:12:19: Happens more than you'd think!

00:12:21: So take that three-partner headache, and I don't know multiply it by fifty.

00:12:26: Oh boy

00:12:27: The Quantum Internet Alliance.

00:12:28: Yes Stephanie Wenner recently highlighted this.

00:12:31: We are talking about over fifty partners across multiple member states plus twelve different spinouts And they're all trying to build an operating system for a quantum network.

00:12:41: When you scale a consortium to that size, the legal friction must be astronomical.

00:12:46: It absolutely is!

00:12:47: And this aligns directly with IP market reports' warnings about ecosystem interoperability and specific challenges of university spin-outs.

00:12:55: Why spin-out specifically?

00:12:57: Well when you build an network operating system The entire value proposition is interoperabilty.

00:13:02: Right it all has work together But in ecosystem of fifty partners often involves numerous University tech transfer offices.

00:13:09: Oh

00:13:10: right Universities can be tricky.

00:13:12: Very A spin-out might have the baseline rights to use a university's research, but The tech transfer office might retain margin writes or strict controls over whether that spin out Can actually modify their research To integrate it into a larger commercial platform

00:13:27: because the University wants to ensure they aren't cut Out of the eventual commercial upside if this thing becomes the next internet.

00:13:33: precisely They want their piece of the pie.

00:13:35: And the other massive layer here is the emerging landscape of SEPs, Standards Essential

00:13:40: Patents."

00:13:41: I've heard that term thrown around?

00:13:42: Yeah so if The Quantum Internet Alliance successfully establishes the foundational operating system...the specific communication methods they develop will literally become the industry standard.

00:13:53: and If your patent covers That Standard you essentially hold the keys to the kingdom right.

00:13:56: every single person using the network has To go through You.

00:14:00: Yes, but holding those keys fundamentally changes your business model.

00:14:04: When you're patent becomes a standard it becomes an SEP.

00:14:07: Okay

00:14:08: You no longer have traditional monopoly where you can just simply block competitors from using It under international IP norms?

00:14:15: You are legally obligated to license that technology Under Fran terms fair reasonable and non discriminatory terms.

00:14:22: Oh so you can't Just hoard the tech you Have To Share It You Just Get Paid for

00:14:26: it.

00:14:26: Exactly Managing that pivot from selling a proprietary product to suddenly managing a massive global licensing program.

00:14:33: That is a highly specialized IP challenge, but the quantum industry is really just beginning to wake up too.

00:14:39: It's like going from being a boutique shop to becoming a public utility?

00:14:43: That's a perfect way to put it.

00:14:45: But you know what happens when you take that perfectly architected fifty partner ecosystem and You try to scale it across physical borders.

00:14:55: Right.

00:14:56: Because once you have the tech, manufacturing and partners dialed in You hit ultimate regulatory wall.

00:15:02: Carmen Palacios Barrichero recently announced that New Quantum which is a UK based company Is opening development center in Spain

00:15:10: Right expanding their footprint

00:15:12: And this expansion is fueled by Series A financing That specifically includes public Spanish investment To build out there photonic networking capabilities.

00:15:21: It sounds like massive win on paper But structurally It seems incredibly complex.

00:15:28: Like, how does a startup keep its IP ledger clean when the funding comes with those geographic strings attached?

00:15:34: This scenario is exactly where the IP market report really proves it's value—it focuses heavily on the need for cross-jurisdictional filing and public funding strategies.

00:15:43: International expansion basically forces a company to define its internal legal architecture...

00:15:49: Okay map that out for me.

00:15:50: Think about it If new Quantum's engineers in Spain invent a breakthrough networking component, but the parent companies in the UK how is that IP captured?

00:16:00: Which legal entity actually files the patent—the U.K one or Spanish

00:16:04: one?".

00:16:04: I would assume the parent company wants to own it all!

00:16:07: Sure...but…how are intracompany licensing agreements structured so that the UK parent can use the Spanish subsidiaries' invention

00:16:15: legally?!

00:16:16: And I imagine public spanish investment heavily complicates internal transfer.

00:16:21: Governments don't typically hand out public funds just to watch the resulting intellectual property immediately get siphoned off To a foreign parent company, you know they want local economic benefit.

00:16:31: You've hit the nail on the head.

00:16:33: Public financing almost always comes with strings attached specific conditions regarding where the technology can be developed Where it can be manufactured or even transferred.

00:16:42: The IP strategy has to navigate those public financing conditions incredibly carefully.

00:16:47: So what happens if they mess that up?

00:16:49: Well, if the external patent attorney is just blindly focused on drafting the claims for the new photonic component and completely ignores the funding conditions that company could accidentally handcuff its future global growth or worse face massive clawbacks from The Funding Agency.

00:17:04: Wow!

00:17:05: So IP strategy isn't just legal text it's basically diplomacy in corporate structuring combined

00:17:11: Absolutely.

00:17:12: Which naturally brings us to Freca Hyman-Tapasca observations.

00:17:16: She essentially connects the dots between quantum industrialization and the heavy machinery of government oversight.

00:17:22: Yeah,

00:17:23: she really zooms out!

00:17:24: She linked a scaling-of-quantum businesses directly to public procurement export control in investment screening processes.

00:17:31: She is basically signaling that you cannot talk about scaling a quantum business today without talking about national security.

00:17:37: And honestly this might be the heaviest most consequential insight from the entire IP market report.

00:17:43: we are seeing forced rapid integration of IP management with regulatory policy.

00:17:48: Because quantum is dual use, right?

00:17:50: Exactly!

00:17:51: It sits squarely on the dual-use boundary meaning it has massive commercial potential but equally massive strategic and military potential.

00:17:59: so governments are stepping in.

00:18:01: we have The Upcoming EU Quantum Act And various foreign direct investment or FDI screening regimes taking hold across the globe.

00:18:08: So how does an FDI Screening Regime actually interfere With a company's IP strategy?

00:18:13: Let's say let's say I'm a European quantum startup and I want to license my software to major Asian electronics manufacturer.

00:18:22: or maybe, i wanna take massive venture capital injection from US based fund.

00:18:27: What is the actual mechanism that causes friction there?

00:18:31: The mechanism is regulatory review trigger.

00:18:34: in past taking venture capitol was primarily just an equity exchange right licensing with private commercial contract.

00:18:41: this business as usual.

00:18:43: But now because the technology is designated as dual use, transferring the IP whether that's through a license or even just by granting a foreign investor a board seat where they get access to trade secrets.

00:18:54: That triggers a national security review.

00:18:57: The FDI screening bodies will actively scrutinize exactly what intellectual property is changing hands.

00:19:03: So standard IP licensing deal isn't just illegal contract anymore It's literally a geopolitical event.

00:19:10: The IP market report stresses that a company's IP strategy must now be deeply, deeply integrated with export controls and FDI exposure.

00:19:20: Because if they aren't talking to each other...

00:19:22: Disaster!

00:19:23: If your patent attorney is filing applications in jurisdictions where Export Controls will prevent you from ever actually selling the product there You are just burning capital.

00:19:40: blocked entirely by the government.

00:19:42: Unbelievable!

00:19:43: So when we pull all these threads together, this sheer scale of evolution here becomes so obvious.

00:19:49: I mean...we started with Soler's point about aggressive push for revenue which completely reframes the whole purpose of IP from scientific protection to business enablement.

00:20:01: And then we saw Getz building actual physical factories, which expands the IP footprint from isolated qubits to these massive troves of manufacturing execution knowledge and trade secrets.

00:20:13: And the complexity only compounds from there?

00:20:15: It really does!

00:20:16: We explored The Collaboration Crucible with Berghoff, Maniscalco & Wainer... ...we saw that surviving a tier one foundry integration requires really rigorous IP sequencing and that building massive consortiums requires an incredibly delicate IP architecture just to avoid post-project commercial gridlock.

00:20:35: Which is a whole full time job in itself!

00:20:37: Seriously... And finally, with Palacios Barrichero & Hyman Tapasque we hit the global regulatory wall where public funding conditions and FDI screening turn your everyday IP management into literal matter of national security.

00:20:52: The throughline here is undeniable.

00:20:54: The

00:20:56: old playbook of simply filing a patent for a qubit architecture and calling your IP strategy complete?

00:21:02: Is entirely dead

00:21:03: dead and buried.

00:21:04: Exactly, the insights from these seven authors mapped against the unmet needs in the IP market report prove that today's quantum IP management is a completely different discipline.

00:21:14: it requires sequencing disclosures negotiating really complex consortium rights before the engineering even begins and navigating a complex web of global security regulations.

00:21:24: It Really Is A High Wire

00:21:26: Act And The Margin for Error is shrinking as stakes get higher.

00:21:30: It is.

00:21:31: And as we look at where this industry is heading, I actually want to leave you with a final thought to ponder...

00:21:36: Okay let's hear it!

00:21:37: We are entering an era when quantum computing will increasingly rely on massive cross-border networks distributed manufacturing and standardized software layers.

00:21:47: in that highly regulated high collaborative environment?

00:21:50: We have to ask ourselves Will the ultimate commercial winners of the Quantum Race be the companies who build absolute best quantum hardware?

00:21:59: Or will the winner simply be companies who architected the most agile, resilient IP and licensing frameworks early on ensuring they could actually bring their tech to market without getting tangled in legal regulatory gridlock?

00:22:13: Wow.

00:22:14: That is a multi-billion dollar question isn't it!

00:22:17: The best concept car in world won't win race if its legally barred from driving on highway.

00:22:22: Exactly

00:22:24: Well.

00:22:24: thank you for joining us this deep dive.

00:22:26: Keep asking questions Keep looking beneath the surface of next big tech headline.

00:22:31: We'll see you next

00:22:49: time!