This is an issue that can come up with regards to the work that technology design companies such as IBEX provide for clients.  We will typically provide clients with a royalty free licence to use the designs we provide (e.g. for software, source code, electronic designs, etc) and only assign full Intellectual Property (IP) rights for non technical design elements (e.g. visual appearance, graphic design etc).

You might be thinking this is all rather unfair and not like the graphic design company you use who assigns you full IP rights on all the design work they do for you.  The thing is, a graphic design company starts off your project with a blank sheet of paper, or maybe with some existing designs you supply to them. That's not the case for electronic, software and other technology development fields.  Most of the development work we do involves utilising lots of our pre-existing design elements towards your project, at little or no cost to you, as well as creating all the new elements that are needed for your specific project.

OK, so why can't you have ownership of the bits that are developed specifically for you?  Your paying for the time it takes to create them so why can't you own them?  Well there's a few things to bear in mind:

  • Firstly, trying to separate the two (the pre-existing and the new) can be very difficult on a practical level.  This is particularly true for software source code.  When writing source code a programmer tends to constantly grab existing bits of code from libraries and past designs to do all sorts of simple things.  Trying to administer whats new and what isn't can quickly become impossible on a practical level.
  • Very often when we start off creating some new design element or block, say for instance an electronic circuitry or source code block to do something particular, we start off using an existing design element or code segment you haven’t paid for and adapt it as needed for the task. Your therefore only paying for time it takes us to adapt it and you're getting the underlying base design or code functionality at no cost to you. The extent of this varies a lot, but given all the years we’ve been designing and programming it’s rare there is something we need to design where there isn’t something existing we have that is used to start as a basis from.  Again, whats new and what isn't, but also how can you own something you haven't paid for in its entirety and contains bits that have also been released within other designs for other clients?
  • Your project will typically use large amounts of existing design elements (schematic and PCB component definitions, library source code, mechanical part CAD designs, etc) that we copy straight in and use as is.  You get all this at no cost to you.  If you want ownership of the bits we create specifically for you then you need to start paying towards all these other bits your getting for nothing.

These last two points are why using a design house can be so much cheaper than using an employee.  Not only can you use us only when you need us, but you also get our extensive background utilised on your project at no additional cost.  With an employee you’ve got to pay for everything to be created from scratch, as they can't bring libraries with them from their last employer!

So this is why design companies like IBEX grant you a licence to use technology parts of a design.  Its simple to state legally, its simple for you to assign if you ever want to sell the product design to another party and you get a design at a significantly lower cost than it being designed from scratch.

That said, if you must own the IP rights in your design it is possible.  If you need to own all of the IP then it is typically only achievable by us designing everything for your project without using anything pre-existing.  Do-able, but typically much more expensive.  Alternatively if there are one or two specific aspects of your design you need to own then we can often quote on the basis of designing just these elements from scratch within the overall design work and to assign you IP ownership of them.

Want to know more?  Please give us a call…

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We benefit hugely from resources on the web so we decided we should try and give back some of our knowledge and resources to the community by opening up many of our company’s internal notes and libraries through mini sites like this. We hope you find the site helpful.
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