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  • flankenking flankenking Nov 28, 2012 4:32 AM Flag

    Living Social could hurt this patent of Local Corp

    Groupon needs for Groupon Now a licensing from Local Corp

    "Before a company can book a single penny in profit it needs a product to sell. Yet in today’s fiercely competitive global economy, before a company can produce something to sell, it needs to patent the idea. Otherwise, it’s too easy for competitors to knock off the product and steal market share.

    In other words, being first to market is no longer enough of a competitive advantage. Companies need to be first to market and have patents protecting their products to ensure sales and profit longevity.

    Groupon (Nasdaq: GRPN) and Apple (Nasdaq: AAPL) serve as good examples of this new paradigm at work.

    As you’re well aware, Groupon invented the daily deals market in 2008. All it took was a novel idea to connect consumers and businesses in a new way – via coupons over email. But guess what? Groupon didn’t have even one patent protecting its novel business model. And within four years, over 300 competitors emerged. Now, Groupon doesn’t stand a chance to keep booking higher profits, let alone survive.

    Contrast Groupon’s experience with the details behind the meteoric rise of Apple and you’ll definitely get the connection between patent filings and stock price performance.

    We can all agree that Apple took the world by storm with its iPhone launch in June 2007. Before it sold a single one, though, it secured as many patents as possible. And it continued to do the same thing on every next generation device."

    Source: Patent Filings: The Next Great Leading Indicator by Seeking Alpha
    March 11, 2012

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