15.3 Describe the advantages and disadvantages of licensing.
Exhibit 15.3 summarizes the advantages and disadvantages of licensing from the perspective of the licensor. Let’s highlight some key points.
Advantages and Disadvantages of Licensing to the Licensor
| Advantages | Disadvantages |
|---|---|
| Does not require capital investment or presence of the licensor in the foreign market | Revenues are usually more modest than with other entry strategies |
| Ability to generate royalty income from existing intellectual property | Difficult to maintain control over how the licensed asset is used |
| Appropriate for entering markets that pose substantial country risk | Risk of losing control of important intellectual ... |
