Technology life cycle
The latter is concerned with the life of a product in the marketplace with respect to timing of introduction, marketing measures, and business costs.
Similarly, in the later stages, the opposite mistakes can be made relating to the possibilities of technology maturity and market saturation.
The technology adoption life cycle typically occurs in an S curve, as modelled in diffusion of innovations theory.
The tendency to license out technology only appears when there is a threat to the life of the TLC (business gain) as discussed later.
[7] There are always smaller firms (SMEs) who are inadequately situated to finance the development of innovative R&D in the post-research and early technology phases.
In the case of small and medium firms, entities such as venture capitalists or business angels, can enter the scene and help to materialize technologies.
With both venture capital funding and strategic (research) alliances, when business gains begin to neutralize development costs (the TLC crosses the X-axis), the ownership of the technology starts to undergo change.
Strategic alliance partners, allied on research, pursue separate paths of development with the incipient technology of common origin but pool their accomplishments through instruments such as 'cross-licensing'.
The ascent is the strongest phase of the TLC because it is here that the technology is superior to alternatives and can command premium profit or gain.
Till this stage is reached, the technology-owning firm would tend to exclusively enjoy its profitability, preferring not to license it.
The maturity phase of the technology is a period of stable and remunerative income but its competitive viability can persist over the larger timeframe marked by its 'vital life'.
However, there may be a tendency to license out the technology to third parties during this stage to lower risk of decline in profitability (or competitivity) and to expand financial opportunity.
The exercise of this option is, generally, inferior to seeking participatory exploitation; in other words, engagement in joint venture, typically in regions where the technology would be in the ascent phase, as say, a developing country.
To prolong the life cycle, owners of technology might try to license it out at some point L when it can still be attractive to firms in other markets.
There are instances when, even though the technology declines to becoming a technique, it may still contain important knowledge or experience which the licensee firm cannot learn of without help from the originator.
According to the Encyclopedia of Earth, "In the simplest formulation, innovation can be thought of as being composed of research, development, demonstration, and deployment.
