Technology Licensing and Technological Development:

The Effect of Partially Opened Licensing on Technological Advantages

Abstract

In existing researches on technology licensing, researchers have pointed out positive aspects of partially opened policies. A partially opened policy is that a company limits the scope of technology license in terms of a company or a technology. Companies that adopt partially opened policies can curtail market competition while expanding product market.
This paper, on the other hand, points out negative aspects of partially opened technology licensing policies. There is a possibility that a company that utilizes a partially opened policy loses competitive technological advantages. This is because in a situation where a competitor adopts an open policy while the company adopts a partially opened policy, other companies that are not eligible for the license will develop a competing technology.