Commercialising in-house software and inventions
Australians are a handy lot. Every Australian farmer claims he can fix anything with a piece of wire. And they would probably be right.
This can-do attitude permeates our culture. You might find that a problem in your business leads to you developing in-house software or physical inventions to solve it. Once these things work, you might be thinking, “Wait a minute. Could my software or invention be commercialised around the world?”
Here we look at how to commercialise Australian software and Australian inventions around the world. The journey starts with internal problem-solving and can end with global commercialisation, if you focus on intellectual property protection, commercialisation steps, and the strategic choices you will have to make in distribution.
Top Ten List of Famous Australian Software and Inventions
Australia has been the birthplace of numerous significant inventions and software. Here are ten famous examples:
- Wi-Fi Technology: Developed by a team at CSIRO (Commonwealth Scientific and Industrial Research Organisation), Wi-Fi technology is arguably one of the most impactful Australian inventions, enabling wireless networking across billions of devices worldwide.
- Google Maps: While not solely an Australian invention, the foundational technology for Google Maps was developed by a Sydney-based company, Where 2 Technologies, founded by Danish brothers Lars and Jens Eilstrup Rasmussen, which was acquired by Google in 2004.
- Black Box Flight Recorder: Invented by Dr. David Warren in the 1950s, the black box flight recorder is a critical component in aviation safety, recording flight data and cockpit voices to assist in accident investigations.
- Polymer Banknotes: Developed by the Reserve Bank of Australia (RBA) and CSIRO, polymer banknotes were introduced in 1988 to enhance the durability and security of currency, a technology now used in numerous countries.
- Cochlear Implant (Bionic Ear): Invented by Professor Graeme Clark, the cochlear implant has transformed the lives of the hearing impaired, allowing thousands of people worldwide to experience sound.
- Electronic Pacemaker: The first practical pacemaker was developed by Dr. Mark Lidwill and physicist Edgar Booth in the 1920s, laying the groundwork for modern cardiac pacemaking technology.
- Spray-on Skin for Burn Victims: Invented by Dr. Fiona Wood, spray-on skin technology has revolutionised the treatment of burn victims, significantly reducing healing time and improving recovery outcomes.
- CSIRO Total Wellbeing Diet: Developed by Australia's national science agency, CSIRO, the Total Wellbeing Diet is a scientifically formulated weight loss program that has gained international recognition.
- Atlassian (Software Company): Founded by Mike Cannon-Brookes and Scott Farquhar, Atlassian is known for its suite of productivity and collaboration software, including Jira and Confluence, widely used in the tech industry globally.
- Medical Application of Penicillin: While penicillin was discovered by Alexander Fleming, its first medical application was developed by Australian Howard Florey and his team, who figured out how to manufacture penicillin in usable quantities, earning him a Nobel Prize.
The lesson to be learned is that software and inventions can be commercialised successfully from Australia - and if your unique software or invention is any good, you might just be the next one on the list!
The Beginning of Innovation
Innovation often arises from necessity. Companies can face unique challenges, for which off-the-shelf solutions are inadequate or non-existent, so they make their own. This process, driven by their deep understanding of specific problems, can result in software and inventions with potential applications far beyond the initial scope. For instance, Atlassian, an Australian software company, initially developed its products to meet internal team collaboration needs. Today, its tools are indispensable to millions of users worldwide and the founders are billionaires.
Intellectual Property Protection: To Patent or Not?
The decision to seek intellectual property (IP) protection is pivotal. For software, the question of patentability is complex because software is a set of instructions. In Australia, software can be patented if it results in a new and inventive process. However, the speed at which software is developed and updated often makes the lengthy patenting process less appealing. An alternative might simply be to opt for copyright protection, which automatically applies to original works, providing a simpler form of protection.
Inventions, on the other hand, can benefit significantly from patent protection. A patent grants the inventor exclusive rights to use, manufacture, and sell the invention for up to 20 years, offering a competitive advantage. The first step in Australia involves filing a provisional application with IP Australia, securing an early priority date. This is followed by a standard patent application within 12 months, which requires a detailed description of the invention and its novelty. The examination process then assesses the invention's eligibility for patent protection.
Commercialization Pathways
Upon securing IP protection, companies face the strategic decision of how to commercialise their innovation. The options are vast, ranging from direct sales to licensing agreements. Direct sales involve you marketing the product to end-users around the world. It can be done, and you sell at full retail price so there is more money in it, but it requires robust sales and marketing infrastructure. Licensing, on the other hand, lets other companies use your invention in exchange for royalties, providing a revenue stream without the complexities of manufacturing and distribution. The royalty is never as much as the full retail price you get when you sell direct, but there is less set up and expense required on your part.
Manufacturing and Distribution Considerations
For tangible inventions, the decision between local manufacturing and overseas production is influenced by factors including cost, quality control, and supply chain reliability. While manufacturing in Australia offers advantages in quality assurance and intellectual property security, it often comes with higher labour and production costs. Conversely, overseas manufacturing can reduce costs but introduces risks related to quality control and supply chain disruptions, as highlighted by the COVID-19 pandemic's impact on shipping rates and logistics.
Many Australian inventors have gone to China for manufacturing because of the perceived price difference, but an almost equal number have regretted doing so because of quality issues.
The turmoil in shipping rates during the pandemic underscores the importance of flexible and resilient supply chains. Companies must weigh the cost benefits of overseas production against the potential for delays and increased transportation costs. For software and digital inventions, distribution primarily involves online platforms, mitigating the challenges associated with physical supply chains.
Navigating the Road to Global Commercialisation
The journey from developing an in-house solution to achieving global market penetration has challenges but offers immense rewards. Key to this journey is understanding the value of the innovation not just as a solution to your internal problem but as a potential solution to that same problem for everyone around the world. Your software or invention could be bigger than your entire company is today. Protecting intellectual property, choosing the right commercialisation strategy, and making informed decisions on manufacturing and distribution are critical steps on this path.
If your Australian company can navigate the phases of IP protection, commercialisation, and distribution, your business can turn your in-house solutions into worldwide successes, demonstrating the power of innovation born from necessity.