Industry 4.0 heralds a sea change in intellectual property protection for manufacturers – Trade Secrets
Smart manufacturing, often referred to as “industry 4.0”, refers to the merging of digital manufacturing techniques with traditional manufacturing techniques. While many technologies can be identified as playing a role in smart manufacturing, this article will focus on four that are currently gaining attention: cloud adoption, Internet of Things (IoT), machine learning, and artificial intelligence, and additive manufacturing. The successful deployment of smart manufacturing technologies can lead to faster and more efficient production, which is also safer for factory workers. Implementing these technologies also poses intellectual property issues that manufacturers may not be familiar with but which, if handled appropriately, promise great rewards.
Cloud computing refers to the distribution of data and applications across multiple locations, allowing users to access data and applications on demand from multiple locations. As in many other industries, manufacturers are adopting cloud-based computing techniques to enable agile manufacturing and provide real-time data to the production floor. For example, capacity load information from multiple production machines, possibly located in multiple different geographic locations, can be shared in a cloud so that it can be accessed by a distribution unit in real time. This makes it possible to efficiently distribute the work on the production machines.
Market Research Future predicts $111.9 billion in cloud computing investment in manufacturing. Manufacturers considering moving their production processes to the cloud should take a moment to assess whether the new process is patentable. Although it may seem counterintuitive that moving an existing manufacturing process to a cloud-based platform would produce patentable subject matter, a brief study of issued patents shows that the changes needed to modify a process so that ‘it runs properly on a cloud-based platform may, indeed, lead to patentable subject matter. Additionally, newly generated software routines to implement the cloud-based process are likely copyrighted, and the protection of these materials should be assessed.
A related issue for manufacturers migrating to cloud-based platforms is the security of their systems and data. Cloud-based systems, due to their inherent interconnection with other systems, are susceptible to attack. In 2020, targeted ransomware has emerged as a pervasive cyber threat to the manufacturing sector. Such attacks are expected to increase as manufacturing companies adopt increasingly digital profiles. Companies adapting smart manufacturing technology need to protect their intellectual property and the resulting data that is generated. Correcting data breaches is also likely to be important; information theft attacks account for about one-third of cyberattacks against manufacturing companies, with one in five companies successfully compromised.
The Internet of Things
The Internet of Things (IoT) refers to the inclusion of sensors, processing capabilities, and communication technologies into physical devices. The IoT has already started to change the way we perceive devices in our homes; smart TVs, smart thermostats and smart appliances are seemingly ubiquitous. This shift in perspective also affects manufacturing, as several companies race to launch a universal operating system for all IoT devices. Beyond the obvious changes to the manufacturing floor itself, manufacturers need to be aware of two fundamental changes that IoT will bring to their business: IoT will make it increasingly difficult to protect trade secrets, and the IoT will radically change the relationship a manufacturer has with the end consumer.
Traditionally, many aspects of a production line were protected as trade secrets. For example, the exact setting used by a machine to turn the raw material into the desired result may be known only to the people responsible for operating that machine. In the IoT world, this machine is interconnected with other machines, and this interconnection makes it a potential target for attack. Successfully compromised machines can drop their settings, preferences, and other secrets that make a production line “special.” Again, cybersecurity and data management will need to be priorities, not afterthoughts, in the factory of the future.
From an external point of view, the IoT radically changes the traditional relationship that a manufacturer has with the end consumer, as it allows the manufacturer to have access to data regarding the use of its end products. While collecting actual consumer usage data is a fantastic benefit for manufacturers, it comes with obligations around both collecting that data and securing the data after it’s collected. Provided the data collected from end users is done in a transparent and privacy-respecting manner, that data represents a business asset that may ultimately prove more valuable than the originating business.
Machine learning and artificial intelligence
The terms “machine learning” and “AI” are generally used to refer to techniques that enable machines to think like human beings. Applications of these techniques in manufacturing can include predictive maintenance, predictive quality and yield, digital twinning, generative design, energy consumption forecasting, and supply chain management. This area of technology may represent the greatest opportunity for manufacturers to develop and maintain trade secrets related to their operations. The identification of specific algorithms and the inputs provided to those algorithms to produce a desired result will differ from manufacturer to manufacturer, and a manufacturer that chooses a constellation of choices that results in superior performance will likely want to keep this from others in the field.
Additive manufacturing, sometimes referred to as “3D printing,” continues to attract interest and venture capital despite the recent decline in the consumer market. Additive manufacturing allows the use of lighter and stronger alloys in place of traditional materials. It also allows for a more efficient supply chain where parts are made when and where they are needed, rather than being made in one location and shipped to another.
Although some recent developments point to a future in which large and complex items such as entire vehicles can be printed, most current use cases for this technology are to produce parts or subsystems for use in larger systems. The ability to use additive printing technology to manufacture machine parts requires manufacturers to be aware of the patent law doctrine of repair and rebuild, which distinguishes between authorized repair of a patented item and unauthorized reconstruction of a patented article, the latter constituting patent infringement. . Larger system manufacturers will likely want to consult with a patent attorney to ensure their patent coverage is as strong as possible. Similarly, manufacturers of smaller components may require more extensive indemnification clauses in service contracts to shift the risk of patent infringement to the customer.
Each part manufactured by 3D printing is represented in the form of a data file which is used by the printer to manufacture the desired object. Manufacturers will want to consider the extent to which their data files can be copyrighted, allowing them to control the final manufacture of the object represented by the data file.
Finally, manufacturers may find themselves able to protect their printing operations by using trademark protection. If, for example, a manufacturer has a specific process that allows them to 3D print a certain material, or finds that objects printed using their process have superior characteristics to parts printed using other process, that manufacturer may wish to brand around the process, for example, Printed using MagicTM.
Smart manufacturing technology holds great promise for manufacturers while posing intellectual property issues that many traditional manufacturers may be unfamiliar with. Manufacturers who can identify these issues and take advantage of the opportunities they present will have the advantage of moving to Industry 4.0.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.