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IBM Announces New Licensing Program to Prompt Collaborative Innovation With VCs & Startups


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ARMONK, NY - 13 Dec 2005: IBM announced today that it is launching a new licensing program with the venture capital community to help startup companies accelerate the development of innovative solutions in the marketplace.

The new IBM Ventures in Collaboration program will give venture capital firms in IBM's partner network and their portfolio companies the opportunity to access the broadest range of intellectual property in the industry -- more than 40,000 patents -- to help ignite innovation. The program also provides startups with the opportunity to partner with IBM's inventor community to access the technology behind the patents, thereby stimulating new thinking around IBM's existing intellectual property.

"IBM is making it easier for young companies to innovate," said Claudia Fan Munce, IBM vice president and managing director, Venture Capital Group. "This program provides VC-backed companies with an opportunity to access IBM's patent vault to innovate faster and become more successful in the marketplace."

The IBM Ventures in Collaboration program was developed after extensive consultation with the venture capital community, including members of IBM's own Venture Capital Advisory Council. The end result is a program that offers a simple, affordable licensing agreement; without the high costs and complexities found in most licensing contracts.

The program consists of two types of cross licensing agreements; one specifically designed for early-staged startups generating less than $10 million in revenue, the other designed for later-stage, venture-backed companies with greater revenues. Both agreements minimize the need for extended negotiations and accommodate the accelerated growth cycles of the startup. An added feature is that the program is administered through the companies' investing VCs, who have the legal and capital resources to implement it.

"This is a unique program that gives smaller companies access to a treasure chest of intellectual property on affordable terms," said Jo Taylor the Head of Venture at 3i, a leading international Venture firm. "It is fantastic to see IBM taking such a positive approach by supporting high-growth, venture-backed companies on an international basis."

One example of how a startup might use IBM's patents can be found in IBM's patent portfolio covering wireless technology. Wireless technology gives consumers the freedom to access information anywhere, anytime and at a moment's notice. Imagine the value of IBM's wireless Braille device patents to a young start up developing a new handheld device that enables the sight-impaired to access the Internet and to receive important information at their fingertips. In this example, IBM's intellectual property can be used to help the start up company advance their innovative wireless ideas while encouraging new creative uses for IBM's patents.

IBM's venture capital efforts are a unique differentiator in the marketplace. IBM's VC efforts are focused on building win-win business partnerships with VC backed start-ups, which have led to rapid growth of these innovative companies in IBM's ecosystem. IBM partnerships with VC backed startups through its formal PartnerWorld partnership programs have jumped from 20 to more than 950 in the past eighteen months.

The IBM Ventures in Collaboration Program reflects IBM's partner-focused business model and is the latest in a series of innovation-related announcements that IBM has made over the past 16 months including: pledging 500 software patents to the open source community, granting open IP access to specific standards bodies and formalizing a non-assertion pledge for the Linux kernel. Further information about this program can be found at the IBM Venture Capital Group website, www.ibm.com/venturecapitalgroup.

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