Rossi: Manufacturing, not Licensing is Focus for E-Cat

With the achievement of obtaining a US patent now accomplished, one might think that an attractive avenue for Rossi’s Leonardo Corporation would be to start licensing E-Cat technology to outside companies, which would provide new revenue streams and help with the proliferation of the technology.

However Andrea Rossi has made a comment on the Journal of Nuclear physics that indicates that approach does not seem to be in the cards at the moment. When asked whether Leonardo/IH was willing to “license/manufacture some of the e-cat discoveries and label them as ‘patent pending’” while other patents were going through the application process, Rossi responded:

“More than licensing, we are now focused on manufacturing, which will be the next step ( F9). The 64 patents I am working upon are part of a complex IP protection that anyway will not affect the manufacturing scheduling, also because we will reach a so high level of economy scale that our competitors will not have any convenience to make reverse engineering, also considering that the US patent allowed does not leave much room under the process and apparatus point of view. We can proceed independently from the patents that are pending and the patents that will be applied for for the time being. Again, provided the results of the R&D and tests on course will reach positive results: our disclaimer related to the fact that the final results could be negative is still valid.”

So it seems that the patent approval hasn’t really changed the commercial approach which Rossi has long said is to start manufacturing once the current 1 MW Plant test is successfully completed, and use the strategy of high volume, low cost production to discourage competitors from reverse engineering the E-Cats.

Rossi has said that people will be surprised at the speed with which commercialization will get underway, providing the test on the 1 MW plant completes a successful test. He has said that no time will be lost in getting the production and manufacturing underway — and it looks for now that they will stay in the driver’s seat on this, rather than sharing their technology via a licensing model.

  • Albert D. Kallal

    I don’t think the servicing and maintains of the consumer
    e-cat will be any more of a challenge then say servicing of your existing furnace
    or air condition unit.

    And as far as manufacturing goes, they should in theory
    be able to ramp up quite quickly. I recall the engineer who designs those animated
    robot figures seen in restaurants. This engineer simply designs the product,
    and then outsources the manufacturing out. So one manufacture will build part
    X, and then ship that part on to the next manufacturer who adds some more bits
    and parts. (and so on!). And then the last manufacturer simply ships to the customer.

    In effect the engineer does not own any factory, lives in
    a simple apartment, and yet he is in the manufacturing business. The internet
    today allows this setup. As long as you can design something that can be manufactured,
    then you are much in business today and don’t need your own plant.

    I think the major hurdles for a consumer e-cat will
    certification, and coming up with a good working consumer design. Once this
    occurs, then the manufacturing, distribution and servicing is not really much a
    challenge. (the existing HVAC companies in any city can service such devices).

    And while competition will eventually heat up (to use a
    pun!), I would not discount the “first mover” advantage. Apple not the only
    smartphone company, but they enjoy a strong market position due to them being
    first to market.

    The larger problem for competitors to e-cat is they are a
    few years behind and now with patient issues, the competition may well have a
    difficult time producing such devices without infringing on e-cat patients.

    China and some country might steal the IP of the device, but they not be able
    to sell such products into the USA or any developed nation that respects
    copyrights (and that’s also the nation were such products will fetch the best
    price).

    If Rossi succeeds in building a mass produced consumer
    device, then we are looking at the next GE, Apple or Google in terms of market value.

    The fact that larger industrial players all seem much asleep on LENR only helps
    Rossi even more.

    Regards,
    Albert D. Kallal
    Edmonton, Alberta Canada

  • GreenWin

    Stumbled across this article from “One World of Nations” from late last year – roughly translated from Russian. “US President Barack Obama has proposed to China to jointly develop generator technology “cold fusion.” http://www.oneworldofnations.com/2014/12/us-president-barack-obama-has-proposed.html

    There has been little or no backup for this tale but it does mention E-Cat players JT Vaughn and the “Generator Rossi.” What is the connection to China in all this? Aside from Darden’s work on the Chinese Tianjin Huayuan (NiH) Industrial Park manufacturing zone, there is also his and JT Vaugh’s work via the Sovereign’s Capital. Sovereign’s is investing in the expanding middle class of Southeast Asia. http://sovereignscapital.com/#advisors-menu

    • Eyedoc

      Nice find….I wonder if its true? We are certainly living in very interesitng times

  • Brent Buckner

    I think it’s sufficient to know that Tom Darden heads IH. Being as he’s CEO of Cherokee, I think he can get sufficient managerial resources as he needs them – as he’s done before.

  • MasterBlaster7

    I like this direction Rossi is going.

  • Omega Z

    I think everyone reads way to much into Rossi’s singular posts. You can’t draw conclusions from just 1. You need to consider them in concert. Things like “License to Manufacture”.

    And statements like-“More than licensing, we are now focused on manufacturing,”- Licensing isn’t excluded, but including manufacturing. These are hand in hand.

    Clips from JONP & Rossi posts.
    —————————————————————————————————————–
    Aug. 4th, 2015___ #3- who will manufacture the E-Cats? Leonardo Corporation and the Licensees that have also the manufacturing license.

    Aug. 7th, 2015___#3- did Leonardo Corporation make agreements to sell licenses for the manufacturing and/or sell the E-Cats for limited territories? YES

    July 3rd, 2013___Our USA Partner and world Licensee for the manufacturing is the sole in charge to determine the sales of energy and/or plants.(Likely Industrial heat)
    ————————————
    To cheap to reverse engineer
    May 17th, 2015 Rossi post to Frank Acland
    Our strategy, though, is to defeat the competition making prices that make reverse engineering pointless. Also in this fields, as in all others, competition will make the Customers happy
    —————————————————————————————————————-

    To cheap to reverse engineer means most are not going to bother. It will be cheaper to license it’s use in their products. Does Intel inside ring a bell.

    To cheap to reverse engineer- Does not rule out competitors. The Big boys will have most of the information they need just from patents. And probably they will reverse engineer Rossi’s reactors. Several reasons. To make certain it is as published & 2nd, to assure they develop technology different from his to avoid patent infringement.

    I also think anything Industrial heat manufacture’s will be of a prototype nature as part of R&D.

    Consider- How many I-Phones does Apple manufacture?
    I don’t know how many prototypes Apple builds, but manufacturing is all contracted out. Apple is a product marketing Corporation. Not a manufacturer.

    This allows Apple to be a huge Brand in the market without all the downsides of building, maintaining, or updating a manufacturing base. In fact, Apple can leverage one manufacturer against another for best price.

    IMHO, Industrial heat / Leonardo will operate somewhat like Intel & Apple or a combination thereof. This is the norm today.
    Samsung, Apple’s competitor actually make product for Apple.
    Most Auto glass used in the U.S. is manufactured by a Ford division. Yes, It’s even used by GM.

    • oceans

      your right Omega, Industrial Heats plan to mass manufacture is much like Apple and it has been a huge success the – To Cheap to Reverse Engineer mantra is going to WORK !

      The “licensing model” – will lag behind the progressive Industrial Heat business plan, of course we are looking at the “Standard” for Cold Fusion Generators, like Apple phones
      eCats will lead in customer satisfaction and support.

  • Publius

    If I had to do a quick psych profile on Rossi, I would say this is about redemption for him. He mentioned having lots of time to think while in prison and while he’s had plenty of negative attention during his career, the E-cat provides a way to redeem himself. This also explains his sly remarks and grandiose messages – he is a seasoned long-distance runner and obviously saviors the race strategy more than the end results.

  • Alan DeAngelis

    When Rossi starts to produce electricity with the Cats, he could be the first to use them to reduce his manufacturing costs (giving him a further competitive advantage).

  • Roland

    I think we’ll do well to remember the recent announcement that IH is more interested in selling heat, and presumably electricity, than machinery as the end product.

    This path has immediate implications for IP protection, IH/Leonardo physically controls access to the machinery and, hence, the IP.

    This path has interesting economic implications, once a contract to provide heat/electricity is in place it is a negotiable instrument that can immediately be monetized at a discount from face value before the machinery is built or installed once the soundness of the engineering and economic advantages are adequately demonstrated.

    In-so-far as IH is a going concern they already have customers for industrial heat; I think we can expect the first customers for E-Cats, and their attendant economic advantage, are well known to IH. These customers will be presented with zero down, zero installation, zero maintenance scenario that will start saving them money the second the ‘on’ switch is thrown. When the same strategy can be applied to electrical sales the growth rate will be extraordinary.

    Selling the contracts at a 10% discount per annum from face value, a 10% yield over the length of the contract for the purchaser, could bring in capital at a faster rate than could initially be deployed.

    • Daniel Maris

      If the E Cat is genuine, I think this approach you outline is quite likely.

  • LilyLover

    Thank you, I know.
    I have cultivated a habit to discredit myself as evident from my many other posts. That’s my assasination prevention mechanism. If I always stay objective – I may live a shorter life. The wise know what to pick from my comments, and that’s enough for me.

    • f sedei

      Don’t discredit yourself. Cold fusion and LENR proponents are still being discredited. But, the world is awakening.

  • Bob

    George Henry Corliss invented a new type of valve system for steam engines in the mid 1800’s. His steam engines cost a lot of money and people initially were slow to purchase them because the reputation was not well founded or known. So…..
    .
    he started out by selling his engines for a vastly reduced amount which included in the contract that we would get a percentage of the customer’s savings in coal cost from using the new engine. He often made triple what he would have originally sold the unit for! After a short period of time, his engine was the “HOT” model to buy and he was on top of the market.
    .
    Another possible common thread to Rossi and Corliss…. Corliss spent large amounts of money and time fighting patent infringements against others who were ripping off his design!
    .
    I personally do not think Rossi will succeed for long at keeping competition at bay with mass production / low cost. It will be an infant product. Improvements will come at a very fast pace. What he makes today, will be obsolete tomorrow. Mass production will not keep up. I remember paying as much as $100 for a simple 5 function pocket calculator. You can get them for $1 now and they run on solar with no batteries! For $100 you can buy a calculator that has more power than the Apollo capsule that went to the moon.
    .
    I suspect that once Cold Fusion becomes accepted in the main stream, large amounts of research will pour into it. New ways of using it will be discovered that will make the eCat seem like a Wright Brothers airplane. No patent or mass production will protect it..
    .
    I use the Wright Brothers as an example. They made the first working plane (at least credited for it) Is there a Wright Airplane company today? Was there a Wright Airplane company even 5 years after their first flight? No. They spent their formative years fighting patent wars. They never became a manufacturer of note. In a very short time, others designed airplanes that far surpassed theirs. They may have been first, but they certainly did not succeed long term.
    .
    History is often repeated! I do not know what will most protect Rossi’s design. It may not be possible to protect it.

    • Paul

      I agree with you. Rossi is dreaming, reality is very different… one day he we will wake up.

    • Axil Axil

      According to the bipartisan Commission on the Theft of American Intellectual Property, which produced the report, China accounts for at least half – and maybe as much as 80 percent – of US intellectual property theft.

      “National industrial policy goals in China encourage IP theft, and an extraordinary number of Chinese in business and government entities are engaged in this practice,” it says, with other major offenders including Russia and China.

      Does Rossi think that he could beat China at its own game when all the parts and materials for the manufacture of his reactor come from China. America produces very little, most stuff comes from China.

      • AdrianAshfield

        It will be tougher for China to steal the IP if China is already making the parts under contract. Darden has already set up an organization in China doing LENR research and has good contacts over there.
        I think you underestimate Rossi.

      • Bernie Koppenhofer

        So, we have a paradox, Rossi an apparent super entrepreneur, in business with IH, Darren has has stated, his main goal is to reduce coal use (China). Sure wish I could read that contract between Rossi and IH.

        • kenko1

          IH & Rossi will probably not produce all e-cat related products. Just those related to replacing coal/gas/nuclear power plants. A huge task in itself.

          Rossi is/has to look elsewhere for other applications e.g home heating, hot water,electricity generation etc.

      • Omega Z

        Axil Axil
        China is starting to become concerned with IP.
        When 1 starts building their own IP cache, then they to find IP theft as an issue. Besides that, There can be a high cost if those in power decide to take action. Block the import or apply a 200% import tax.

      • Albert D. Kallal

        They can steal the IP, but they cannot in general sell such
        products into our markets if Rossi has patients.

        Might even see e-cats manufactured in China for sell here.
        And this likely means that knockoffs might hit the streets of China.

        However selling such counterfeit devices in the western
        developed nations will get one in hot water quite fast and is far less of a problem
        for Rossi. You don’t see counterfeit iPhones being sold here for this reason.

        Regards,
        Albert D. Kallal
        Edmonton, Alberta Canada

    • LilyLover

      What will protect it?
      • Too cheap to build – in competition
      • Collective informed open source decision to only purchase Rossi’s device even if it were 10% costlier than enyone else
      • Complexified core that is too hard to manufacture on inferior assembly lines + established contracts for full utilization of all the available complex assembly lines (I.e. the Mitsubishi Outlander PHEV problem – good one to have.)

    • Omega Z

      The customer paying nothing up front wont go very far.
      That would tie up huge amounts of Industrial heats cash at a time they will need it the most. How much do you think financial institutions will front them before they say enough already. And then there’s the finance costs that eat up the profit margin. Other then R&D prototypes, I expect everything E-cat will be licensed or contracted out in one respect or another. It’s the only path that would lead to mass production within a short time frame.

  • mcloki

    Well this provides evidence this isn’t a scam. If it were, the best way to make lots of cash quickly would be to sell high priced licenses.

  • Axil Axil

    A seller needs buyers no matter how much product that the seller can produce, and no matter how cheap his product is. Everybody thinks that LENR is a fraud. How will Rossi convince buyers that his product works. If Rossi intends to sell his product in the near future, he must create demand for his product now. Rossi must convince everyone that he can be trusted and his product is real. Rossi has no marketing plan in place, His product will set in the warehouse unwanted and unsold were these reactors will collect dust.

    Demand takes time to create. How will Rossi sell his product? Can Rossi change his mindset from complete IP protection to open ended sharing of his patent protected knowhow? I personally thing that this mental task will be too much for Rossi to handle. A miser cannot become a spendthrift overnight.

    Microsoft was the first to produce a tablet computer many years ago It took Apple to create demand for that product through innovative design. Rossi should understand that producing a product does not mean people will buy it.

    • Bernie Koppenhofer

      If Rossi can prove and guarantee to industrial customers that he can reduce their heat energy costs by 50%, Rossi will not be able to build E-Cats fast enough.

      • Axil Axil

        The point to be made is how will Rossi prove that his product can reduce energy costs through the lifecycle of his product. How will Rossi produce a reputation of trust and reliability throughout industry. Does he have a marketing plan?

        • mcloki

          Yes he does. Buy an E-cat and reduce your electricity bills by 20-30%. Whatever the percentage that’s all he needs. The environmental benefits and the cost savings will be touted by other sources. Once he has a story to tell. Right now, he has no story, he’s building.

        • Bernie Koppenhofer

          First, cost savings is a huge motivator for any industry needing heat, especially in a competitive environment. Second, I think Rossi is prepared to go into an industrial company and set up his shipping containers, hook into an existing system, with the industrial company having basically nothing to lose if Rossi guarantees a certain percentage of cost savings. Third, the cost savings will be obvious in the first month of operation to any sophisticated industrial company. No trust is necessary (f9)

          • Axil Axil

            Does Rossi have a field service plan defined, Where will he get the people to setup all the realtors he plans to manufacture?

            A industrial supply business is more than building product. It is mostly support, training, and maintenance.

            Rosii will need to sell his business to GE.

            • GreenWin

              Considering how bright the Rossi/IH team is, they might form a small JV with General Electric or Siemens or Mitsubishi, etc. Small because these old manufacturing companies are slower to learn and act than high tech companies. IF such a small JV produces profits and benefit for both partners – options to expand will kick in.

              i.e., it is the old school manufacturers who will need to earn the trust of Rossi/IH. IH is in the driver’s seat. But they should take care to watch their flank. There are many competitors in the alternative energy field today.

            • Bernie Koppenhofer

              “field service plan”, “realtors he plans to manufacture”, these are all “good” problems connected with a successful product. He could very well contract with GE industrial service, or any number of industrial service companies.

              • Axil Axil

                Like any good inventor, Rossi will not want to deal with the details of business. He will hire a bean counter to take care of these unwanted distractions. After a time, the bean counter will steal the business from Rossi as so often occurs.

        • Brent Buckner

          If you bother to familiarize yourself with Darden’s CV I think you’ll be convinced that IH has a marketing plan. Here’s a start: http://cherokeefund.com/tom-darden/

    • AdrianAshfield

      Axil,
      Buyers will be the least of his problems. Once one or two major media outlets give it their blessing the media and magazines will pile it on. Nothing sells as well as saving money.
      Many will have fun (me included) pointing out how wrong the consensus has been too.

      Also, Rossi has already licensed the manufacturing to some other groups and I have not seen that he has bought them back.

    • mcloki

      No. Demand can be created overnight if the business case is strong enough. New tech gets adopted very quickly these days.
      Microsoft failed because it’s product did not work in the real world. The iphone on the other hand worked great and it’s hard to think of a time you didn’t have one.

    • Paul

      IH has also to persuade the buyers that the apparatus does not emit neutrons or other dangerous radiations. This is not 100% obvious, not existing a theory that explain what is happening inside the reactor. Also certifications refer to measurements limited in time and the scientific papers from Russia about neutrons emitted from Ni-H systems, easily to find on the web, leave some doubts, not to mention the neutrons produced by some Focardi-Piantelli’s reactors. So, buyer has to have a blind trust in Rossi or in the good God…

      • Albert D. Kallal

        Consumer certification is going be a real challenge. However like a microwave oven etc., such certification can occur. With a clean bill of health then I don’t see this as much as a issue.

        Regards,
        Albert D. Kallal
        Edmonton, Alberta Canada

    • Mytakeis

      The buyers would be people who need energy. Thus demand exists, without need to create it. Not everyone needs to buy an e-Cat, just a few million, and IT has planners and salesmen. So the allure of near free energy will self-create demand. I believe comparing Rossi to a greedy, miserly, Mr. Scrooge is not appropriate. And there is a world of difference between a internet connectivity device such as a tablet, and an near free energy producer such as an e-Cat.

    • Omega Z

      Axil Axil

      Everyone reads to much into Rossi’s singular posts.
      He merely needs to convince product developers & manufactures.
      If Siemens put a home heating system on the market, customers will buy it. That it has a Logo in the corner of a black cat & ball that says E-cat inside wont matter. They put their trust in Siemens. Not Rossi.

    • Kevin Kingery

      I got my name on the list the first hr it was listed for up to 10 through ? Corp Anderia Rossi president of. They got 5 mil and shut down taking more orders, selling is not going to be a problem! Got my letter from him last summer,was nice that he took time to contacted me, not getting any younger 62. And I plain for my family to have them as well!

    • Albert D. Kallal

      I much agree the market needs to be created. In fact this
      “lack” of market is holding back investment.

      However, just like Apple, or Microsoft or any company based
      in IP rights, they fair rather well in developed nations. With Rossi’s
      patients, it will be difficult for others to jump in and compete unless they
      find ways around Rossi’s patients.

      And the market will be created EXTREMELY fast once
      companies and press reports that customers are happy with such devices.

      People will flock to this device once the word gets out. It will be like the iPhone frenzy where people camp outside all night long in line to get their e-cat.

      The only real issue is how far into the future will these devices become available!

      Regards,
      Albert D. Kallal
      Edmonton, Alberta Canada

  • malkom700

    Apparently licensing rapidly evolving technology not is of great importance, but some license has been obtained for attracting other investors.

  • LilyLover

    I’m pretty sure that the good Doctor has the best of the engineers and scientists. Even if they were upper 25% strata of their profession, as opposed to upper 1%, the magical Doctor has the quality to bring forth the best out of them. Once people are charged with super-human motivation, they tend to produce the best output – far beyond their eqivalent counterparts in other areas. Their proof-in-the-pudding and oh-yea?-come-reverse-engineer-it approach speaks for itself.
    So, I’m sure – not only Rossi’s Team is amazingly competent, but also most kind-hearted team ever assembled.
    I’m proud of his team more than the people of Manhattan Project or the people who reverse engineered the UFOs to whatever extent.
    To me, somehow, Rossi is the Modern Rutherford. Modern Galileo. Modern Marcus Antonius.

    • Nigel Appleton

      Excuse me?

      “reverse engineered the UFOs” ?

      Tell me more!

      • LilyLover

        Any highly liked and debated video of David Sereda
        This is good too…
        https://www.youtube.com/watch?v=2bWWx-zqoTg
        ***
        Why not a cook?
        • My ex-company had bought up the company that had bought up the company that employed him. Company records and Christmas-party jokes are my “evidences”.

      • Mytakeis

        see gaiamtv.com

      • Jimr

        Search TR3b, see comments Ben Rich, Lockeed skunk works director.also Boyd Bushman, Edgar Fouche.

  • Alberonn

    If licencing is not an option at the moment, where does that leave IH, which is a licencee, at least that was the conclusion recently dominant at this site ? And is he talking about, just the 1MW plant or does it include the Hot-Cat X, intended for the homemarket ??
    Anybody sees an indication/line in his recent comments, please enlighten us….

    • ecatworld

      I’m pretty sure when discussing licensing in the above context, Rossi is referring to outside parties who are not currently part of the licensing system already in place.

      I don’t know the details, and the relationship between Leonardo Corp and Industrial Heat is not entirely clear, but I believe that Industrial Heat is a manufacturing licensee, and also a distribution licensee for the United States and China (according to Roger Green of E-Cat Australia).

      • kenko1

        That was my intent when I asked Dr. Rossi. Looks like much will be developed in house or very ‘close to the vest’ so to speak.

        • LilyLover

          I think the core will be manufactured under the supervision of IH but the rest of the E-Cat will be mass manufactured in China. I also think that the Core will be made available to be 3D printed at the partenring companies allowing wide-net replication capability as a secondary back-up.
          I think Rossi wants the ability to offer the 3D printing in the event of certain country not permitting the E-Cat. He can then simply ship-in the fuel mix.
          He simply wants to make sure that –
          E-Cat : If you want one, you can get one, no matter where you are!!

      • Bernie Koppenhofer

        The agreement between Rossi and Industrial Heat can contain such a wide variety of contractual language, an outsider will simply not know the relationship until he reads the contract.

  • Jarea

    Very good to know that he is focusing in execution. That means that everything depends on the results of the test. That is to say, no other problem (patents, competition, etc) can avoid us to see the first LENR commercial product next year .
    i still think there must be some confidence regarding the current test. It is less probable that the LENR device stop working if it has been working good for so long time. I think they already have a good proof of concept and the only variables that need to be defined are durability, stability of materials and components. I just hope they have good engineers that think about all possible solutions to create strong devices. They have to know that earth and society needed this invention some decades ago. How many lives would it have saved?. Every day counts!