Licensing converts rights into recurring revenue without building factories: think Dolby's per-device royalties or a regional brand franchising its name. The asset must be owned cleanly (chain of title), protected (registered where it matters), and packaged (what exactly is licensed, with what support).
Deal points that decide everything
- Scope & territory — what rights, which products, where. The Maaza dispute turned entirely on this.
- Exclusive vs non-exclusive — exclusivity commands higher fees and higher commitment obligations.
- Royalty base and audit rights — a percentage of something you cannot verify is a wish, not income.
- Quality control — for trademarks, required; uncontrolled licensing can erode the mark itself.