So...

The intent of the process outlined here will allow you to reason through and make judicious decisions regarding the various technical, economic and legal issues that you will face when considering the incorporation of a patented entity within your new or upgraded product. The order of the flow described allows you to decide when to 'kick out' at various check-points during the process should the evaluation hit a technical, legal or economic wall that makes use of the patent untenable.

A fateful example -

One product development group was commissioned to develop a new product for the exercise market. The product was based on a low cost and very popular product already in the market, but the new incarnation involved a new, patented PC based monitoring and processing technology that would add great utility to the product. The new technology was based on an existing, inexpensive integrated circuit, so the projected retail cost of the new product, $25, was deemed OK for the expected market retail limit of $28.

So, the project was funded and was well into technical, market and business development when a consultant, who had expertise in the new technology, was asked to come in to review the resulting new product design and implementation.

The consultant quickly realized that no one had been worrying much about how the new product would physically communicate with a PC. As every one said, the solution is simple - "We just need an RS-232 cable" - no further thought given. But when the consultant pointed out that the required cable had a wholesale cost in large quantities of $5.95, the retail price of the complete product was driven beyond the market point of $28.

No one had researched the economics of the total solution the patent required. This example seems rather simple on the face of it, but it was real... and things like this do happen - even with experienced product developers.

Conclusion -

When you select a patented item that, on the surface, may seem like it would add value to a new product concept, you should closely scrutinize the technical, business and legal efficacy of the patent as it relates to your total product solution. With a process of due-diligence to examine these issues in detail, as illustrated herein, you will stand a much better chance of evaluating the real utility of the embedded patent.