For more than a decade Ocean Tomo has published studies documenting the growth of intangible asset value as the major component of S&P 500 market capitalization. A quarter century of data indicate that the United States has transitioned from a tangible-to-an-intangible economy – a literal economic inversion or innovation revolution no less significant than the industrial revolution more than a century before.
This macro-trend extends globally. Europe remains second only to the United States in the relative contribution of intangible assets to market capitalization and is still ahead of major Asian markets. As Europe begins to invest more in technology and the European patent marketplace, there will be a rise in intangible asset value and further movement to an intangible economy.[1] Similarly, as Chinese companies continue to file locally and purchase more patents internationally, Chinese intangible asset market value will likely change dramatically.[2] Korea’s KOSDAQ Index has already shown an increase in intangible asset market value over the past years while investing in intangible assets is becoming a priority for Japanese companies.[3]
As the world went into lockdown, sheltering-in-place in response to COVID-19, Ocean Tomo began to examine if coronavirus would have any impact on the above observations. With many countries now “reopening”, our research suggests that the COVID-19 crisis will further accelerate and make permanent an even more pronounced asset-light economy with substantially reduced future investment in brick-and-mortar businesses and even greater emphasis on a remote tolerant digitalized economy. Work-at-home, online conferencing, distance education, micro-group social events and e-commerce will flourish. Reduced physical barriers to entry or competitive response will result in Intellectual Property (IP) becoming more important as business seeks to carve out its footprint in the new, new economy.
If you have previously received a copy of the Intangible Asset Market Value study from Ocean Tomo, you will receive a copy of the paper upon completion. If you wish to be added to the distribution to receive a copy of the completed paper, please complete the form here.
[1] Cate M. Elsten and Nick Hill, “Intangible Asset Market Value Study?” September 2017.
[2] Cate M. Elsten and Nick Hill, “Intangible Asset Market Value Study?” September 2017.
[3] Cate M. Elsten and Nick Hill, “Intangible Asset Market Value Study?” September 2017.