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Old 07-14-2019, 06:54 AM   #1
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How does licenses system work?

With the term "licensing" economics means the transfer by the author or the holder of a right to another subject, because it can use it deriving economic benefits such as, for example, the production under license.
The licensor, or the one who assigns the license, and the licensee, the one who manages the license, agree that the benefits are reminerated through a fee that can be fixed or variable on sales.
When the word licensing is used in the marketing language we talk about the above right linked to one of the following categories:
art
show/characters
fashions
music
sports
corporate brands
publishing/authors.
The license is therefore that marketing activity through which the holder of a right with reference to the license assigns it to another person with the payment of a single or percentage fee (royalty) in compliance of some rules defined in the license agreement.
In this way the licensee has the right to use and economically exploit the trademark or logo, the process or product technologies and the same knowledge that the licensor makes available with this contract.


Reading all this, i understood that producing under license is really difficult, that there are/there could be many clauses and that before to reach a deal/agreement there must necessarily be many meetings, speeches and, above all, the right predisposition to reach an agreement between the licensor and the licensee.
And i can't understand what happens when there are many licensors and a single licensee, translated, when Herpa has to reach a deal with groups like TUI or IAG!
I recently made two examples, TUI Airways (the production of the B737-800W, B787-8 or the B737 MAX8) and Level Airlines (A320, A321, A330-200).



TUI Airways:
1) TUI Group
2) TUi Travel (leisure/holidays brand of TUI Group)
3) TUi Airways
4) ask to TUI Airways the license to produce a particular model, ie the B757 more than the B737-800WL or the B787-8.
The license works for a particular model, no more for the entire fleet of an airline.
I really don't understand the problems among LOT and Herpa, money for sure, but so big problems impossible to overcome, problems linked to two small plastic/metal airplanes...
Herpa had the license to produce the LOT E175 and the E195 has been a news, but maybe something changed about the profit sharing.
I can't imagine the giant problems around a possible bigger airplane like the B737-800WL or the MAX8!


Level Airlines:
Level is owned by IAG - International Consolidated Airlines Group S.A., an Anglo-Spanish multinational airline holding company.
Level started in 2017 as low cost - long haul flights airline, starting operations from Bercelona "El Prat" airport with Iberia A330's; at the same time Level absorbed Open Skies, owned by IAG and before operating as L'Avion (France).
So, at the beginning, the situation was:
Level Spain (IAG) -> long haul flights from Barcelona "El Prat"
Open Skies France (IAG) -> long haul flights from Paris "Orly"
When Level became the only IAG low cost airline, Open Skies became Level France.
Now Level operates flights from Amsterdam, Barcelona, Paris and Vienna.
If we look at Level fleet, it operates A320's and A321's (operated by Anisec Luftfahrt -> Vueling Austria), A330-200's (operated by Iberia and by Open Skies -> Level France).
So, to obtain the license to produce Level Airlines airplanes in 1:500 scale, Herpa should ask to:
- IAG
- British Airways
- Iberia
- Vueling
- Anisec Luftfahrt/Vueling Austria
- Open Skies (if the company name still exists).
Following a logical reasoning, Herpa produced/produces models by British Airways, Iberia, Vueling; the manufacturer produced the Open Skies B757-200WL.
The "problem" could be Anisec Luftfhart (the Austrian subsidiary of Vueling) for the narrowbodies and Open Skies France/L'Avion for the widebodies.
But in our 1:500 scale sometimes there is little logic.


As already understood, even if Herpa never confirmed it, the license problem is a real "chinese box" and, as Herpa - LOT non-deal showed, it can become a real labyrinth.
Now i don't know where the deal among Herpa and LOT stopped, and why; the only sure thing is that money are the reason.
If somebody has more elements to understand this hard but fascinating world, please post them here.
Thanks.
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Old 07-14-2019, 08:30 AM   #2
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Re: How does licenses system work?

LOT-Herpa---probably a political problem, ever since poland has this ultra conservative government they like to torpedo anything related to germany.
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Old 07-14-2019, 02:48 PM   #3
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That's true.
I've talked to a person involved in the negotiations and it seems that the money isn't main problem.
You should now that LOT is state-owned company, since three years it is managed by people chosen by conservative-chauvinist-xenophobic politicians who unfortunately rule in Poland nowadays.
LOT managers are loyal to their party principals and simply don't want to "deal with these horrible Germans" - especially when there is a possibility to order the models to their own airline-shop directly from the Chinese.
That is the reason of extending and embarrassingly unprofessional licence negotiations - without the will of reach an agreement from one side.
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Old 07-14-2019, 06:44 PM   #4
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Quote:
Originally Posted by pooohaty View Post
You should now that LOT is state-owned company, since three years it is managed by people chosen by conservative-chauvinist-xenophobic politicians who unfortunately rule in Poland nowadays.
Sorry, but this is a 1:500 scale model discussion.
For biased political opinions post on the ultra-leftist forum 😉
Thanks!
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Old 07-15-2019, 04:48 AM   #5
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The LOT - Herpa cause is a sad example of how deeply politicians (and their ideologies) want to interfere in the social-economic life.
And what even sadder, when you criticize this pathology, some ignorants may call you a ultra-leftist...
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Old 07-15-2019, 05:18 AM   #6
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Re: How does licenses system work?

Quote:
Originally Posted by Makemake View Post
Sorry, but this is a 1:500 scale model discussion.
For biased political opinions post on the ultra-leftist forum ��
Thanks!
Quote:
Originally Posted by pooohaty View Post
The LOT - Herpa cause is a sad example of how deeply politicians (and their ideologies) want to interfere in the social-economic life.
And what even sadder, when you criticize this pathology, some ignorants may call you a ultra-leftist...
Friends, please, try to leave political interpretations of the facts and political ideas out; LOT - Herpa non-agreement is sad for us collectors, "right-left" idea we could have of the society and problems solution.
LOT narrowbodies are a too great miss in 1:500 scale and i hope the airline and Herpa will find a solution.
My dream ia LOT B737-800WL and B737 MAX8.
Thanks.


P.S. In 1:400 scale Phoenix (from China) released both B737-400 and B737 MAX8 new livery, a B737-500 has been released by Gemini.
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Old 07-15-2019, 05:23 AM   #7
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Re: How does licenses system work?

Making things even more complicated, it is my understanding that you also need permission/license for the airplane shape itself, i.e. Boeing, Airbus, etc. !!
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Old 07-15-2019, 05:25 AM   #8
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Re: How does licenses system work?

Quote:
Originally Posted by uncle beat View Post
Making things even more complicated, it is my understanding that you also need permission/license for the airplane shape itself, i.e. Boeing, Airbus, etc. !!
Of course, above all you need permission of the factory to produce their airplanes in the different scales.
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Old 07-17-2019, 03:36 AM   #9
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Re: How does licenses system work?

I only know that in 1:400 scale they don't have this type of problems...
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Old 07-25-2019, 09:36 AM   #10
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Marc, even 1:400 scale manufacturers have to ask licenses, except for some few "ghost" manufacturers.
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Old 07-26-2019, 11:48 AM   #11
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Re: How does licenses system work?

A licence (in the means of the trademark law) is an official permission (certificate, tag, document) indicating the authorization to use somebody else’s [the Licensors] (intellectual) property.

A licencing agreement is a legal contract between the licensor (property owner) and the licensee (property user) and usually covers following areas:
- Identification of the licenced property (what property is being licenced)
- Term (how long can the property be used)
- Royalty (licence fees)
- Restrictions (limitations to use the property)

In the model-making and toy industry licencing agreements usually affect trademark and brand rights as well as registered design.

To what extent trademark/brand rights and »design patents« need to be »defended against plagiarisms« in the form of models and toys is highly controversial and the subject of repeated disputes before the courts.

herpa has always preferred to produce strictly in agreement with trademark/brand copyright and design patent owners, stressed their good relations with industry and commercial partners (airlines) and continue to emphasise their »culture of compliance« as a competitive advantage.

And indeed manufacturers and sellers of »unlicensed« products who choose to hide their identities generally complicate their market access.

On the other hand it can be doubted that limited sells of exclusively licenced products (e.g. Cathay Pacific and CXcitement Shop) generate higher total income. But in many cases it may be more a matter of marketing philosophy and »self-conception« then of profit realisation.
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