Should the IDF Cash In?

M any of Israel’s high-tech billionaires and multimillionaires owe their success to the knowledge tools and training they received in the IDF. When these tycoons cash in by selling their companies should the IDF get a cut of the profits reducing the taxpayer’s share of Israel’s defense burden? And should the government pass a tougher law protecting IDF intellectual property (IP) from being misused?

These questions arise periodically where entrepreneurs who cut their teeth in the IDF’s prestigious 8200 intelligence unit commercialize their intellectual property export their products and technology and then reap a bonanza when they “exit ” selling their firm for mega-millions. Prime examples of companies whose top execs trained in Unit 8200 are Checkpoint Verint Systems and Nice Systems with market values on NASDAQ of $18.3 billion $2.59 billion and $4.84 billion respectively.

By law the IDF retains rights to all intellectual property its soldiers develop while in the service and requires soldiers to sign nondisclosure agreements. The gray areas occur mainly in the cybersecurity and software fields when a former soldier doesn’t exactly plagiarize his knowledge but “adapts” it for the commercial market.

The September 25 acquisition of Israeli start-up Gigya by German software giant SAP catapulted this issue back into the public discourse with pundits and academics weighing in on whether the army has rights on the intellectual property (IP) developed under its auspices.