Regular readers know that I have often written about Intellectual Property in this space.  IP is increasingly important in the valuation of all enterprises.  I provided a historical context to this trend here, and later talked about Ocean Tomo, one of the companies that is helping to create the IP marketplace.

As mentioned in one of the earlier columns, the percentage of the aggregate value of the S&P 500 companies that is IP has gone from 17% in 1975 to 80% in 2005. The transactional process of IP, until very recently, has largely been the same as it was 20 years ago. This inevitably means that a more fluent, liquid and transparent marketplace for IP must develop.  One of the initial developments over the past two years has been the IP auction.  While there are a number of these auctions, I have been privy to the Ocean Tomo auctions and using the results from these auctions alone the trend lines are very clear. 

Two weeks ago, Ocean Tomo had its’ spring auction in San Francisco.  Once again record prices for IP portfolios were reached.  One of the lots up for auction sold for $6,600,000, setting a new world record for a patent lot at a multi-lot live auction. The lot was for processing digital data in bit streams In addition there were three other lots that resulted in seven figures sales.  What is interesting about these numbers is they are solidly going upward.  Each auction sets a new world …

Amazon’s introduction of the Kindle electronic book reader feels momentous. It is the first time that the long anticipated, much debated future of the ‘ebook’ feels ready to begin in a meaningful way.

During the past ten years there has been great debate about the ebook.  Generally speaking there have been three points of view on the subject.  The first one comes from the true believers that the ebook is inevitable and that it would ultimately gain a noticeable and then sizable market share of publishing.  The second viewpoint is that while there would be a market for the ebook it would never really capture more than a marginal market share.  The third viewpoint was that the physical experience of reading an actual book is such an integral part of the reading experience that the ebook would never really catch on.  I am one of those that hold the first point of view.

In a column here last summer I wrote:

“e-books will ultimately gain significant market share.  This will occur when there is an ‘iPod moment’; when a device comes out that is low priced, wonderful to use and perceived to be cool or hip.  Once this occurs there will be a rapid increase in the percentage of books sold digitally, probably leveling off around 40 – 50% by 2025. Impulsive buys, such as at airport book stores will become “purchase, plug-in and download’. While those of us who have grown up with the wonderful tactile experience of ‘curling up with …

Intellectual Property (IP) has always been important.  However, as I have written here, in the last 30 years, it has replaced hard assets as the most important part of corporate valuations.  In the Shift Age IP will be the most important asset that any individual or company can own.  The ability to create value, transactions, liquidity and ultimately an open marketplace of Intellectual Capital (IC) is therefore one of the most important historical developments that lies ahead for the emerging global economy.In a couple of recent columns, I have written about the efforts of one company, Ocean Tomo, to lead the way into this new future of IC.  Today we publish an interview with James Malackowski, Founder and CEO of Ocean Tomo.

James E. Malackowski is the President and Chief Executive Officer of Ocean Tomo, LLC, an integrated Intellectual Capital Merchant Banc® firm providing valuation, investment and risk management, corporate finance and expert services.   Ocean Tomo assists clients – corporations, law firms, governments and institutional investors – in realizing Intellectual Capital Equity® value broadly defined.  Subsidiaries of Ocean Tomo include: Ocean Tomo Auctions, LLC; Ocean Tomo Asset Management, LLC; and Ocean Tomo Capital, LLC — publisher of the Ocean Tomo 300® Patent Index (Amex: OTPAT), the Ocean Tomo 300® Patent Growth Index (Amex: OTPATG) and the Ocean Tomo 300® Patent Value Index (Amex: OTPATV).
Mr. Malackowski is an internationally recognized leader in the field of Intellectual Property (“IP”) management as well as a noted expert in business valuation and …

The New York Stock Exchange was founded in 1817.  This was some 50 years after the beginning of the Industrial Age.  The need for the NYSE was, in part, a result of the transition of the U.S. economy from one that was completely agricultural to one that was rapidly becoming industrial.  During the course of the 1800s the NYSE became increasingly important to the economy as a financial market that could provide both financial liquidity to listed companies and as a way to establish valuation and worth of all companies traded. 

In the 20th century the NYSE was joined by many other exchanges such as the AMEX and the NASDAQ.  All these exchanges served to create liquidity, valuation and a way that investors could own and trade in shares of companies.  These markets therefore became central to the miracle that was the U.S. economy of the past 100 years.

Some 30 years ago however, the Industrial Age started to give way to the Information Age and something interesting began to happen.  The value of the hard assets as a percentage of total corporate value started to decline.  As I have written here, in 1975 16.8% of the market capitalization of the S&P 500 was from intangible assets.  By 1995, that number had grown to 68.4%, and in 2005 it was up to 79.7%, where I imagine it will level off in the years ahead.  Another way of stating this is that intellectual property, or intellectual capital has become the dominant value …