Licensing

Licensing is the transfer of less than ownership rights in intellectual property to a third party, to permit the third party to use intellectual property. Licensing can be exclusive or non-exclusive, for a specific field of use, for a specific geographical area. If ownership is transferred, it is called an assignment. 

The transfer of technology through licensing is a useful method for capturing economic rents of technological innovations. Small technology enterprises can benefit from technological licensing. A small firm usually benefits more by licensing its technology than trying to commercialize it. The commercialization of new technologies requires a high expenditure of resources, generally beyond the means of many small entrepreneurial enterprises. Small enterprises, according to Chung to benefit from technological licensing, must overcome their initial naivete by concentrating on the economic and strategic aspects of the process. 

These small enterprises must broaden operational perspective, scope, and build credibility and expertise. To further benefit from technological licensing, small enterprises should improve exchange and interaction capabilities, and enhance experience and responsibility.

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