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Intellectual Property and Digital Economy
In line with my previous theme of Intellectual Property (IP) and the digital economy, this post looks at a recent Position Statement which I helped to draft for the BCS Chartered Institute for IT.
As you may know, one of the core values or mission of the BCS is to advance the role of IT in bettering society, business, education and the economy, and what better way to do this than by suggesting ways in which IP could work better in the evolving digital economy.
Some key issues highlighted in the position statement include:
- The rapid pace of technology change often leaves behind the Intellectual Property (IP) construct which was created to provide economic benefit for the creators, authors, inventors and owners of related IP
- An enormous amount of money is spent annually on IP related litigation (particularly when IP is viewed and used as a tactical weapon). This could be better spent building the right system in the first place
- According to BCS feedback from the 2013 Parliament and Internet conference, intangible and virtual goods online extend to more than just music, written word or software – I’m thinking about the Internet of Things too
- Also, The EC announced an initiative to define a position on taxation of the digital economy – this gets very interesting when you try taxing something like Bitcoin!
- Creating a feedback mechanism to regulate the impact of IP changes on the digital economy, in a transparent manner.
- Developing fast, automated and dynamic IP mechanisms to cope with blurring boundaries of IP (e.g. for emerging trans-media content), and surge in high-volume / low-value transactions online.
- Keeping everything in context, because society is still at a very early stage in understanding and adapting to changes introduced by digital technology – digital IP is in a period of transition without any appreciable end state to speak of.
2. BCS understands the need to ensure all 5 digital stakeholder groups (i.e. the creator, commercial, consumer, technology and governance stakeholders) are consulted, engaged and involved in the creation of digital IP structures for the future. BCS has representative groups and forums that cover all 5 stakeholder groups of interest.
Digital Economy and IP
Over the past few months, I had several opportunities to engage in the conversation about the role of Intellectual Property (IP) in the new world of Digital, and in so doing, I’ve managed to tease out certain key questions and concerns surrounding this topic, e.g.: What challenges and opportunities does IP bring to the Digital feast? How does the ‘sharing’ economy affect established notions of IP, and how effective are current efforts to update and harmonise IP in the digital age? The answers are slowly revealing themselves, but the following observation points will hopefully highlight the way.
What is Digital?
The term “Digital” means different things to different people, (including those that consider it an extremely irritating term for something old repackaged as a new ‘buzzword’). In my opinion, the term Digital can be used to describe various new and emerging products / services / processes / user behaviours etc., that are enabled by digital technology. It works equally well in describing innovative, disruptive trends (e.g. big data and predictive analytics) and / or re-imagination of pre-existing technologies (e.g. Cloud).
How does IP figure into it?
Intellectual property is the concept and mechanism through which creators and owners of “works of the mind” may derive economic benefits from their works (e.g.: inventions, designs, works of art, and trademarks). By its very nature, IP is constantly challenged by those self same things for which it was designed – e.g. printing press, audio-visual capture, playback and distribution technologies, and even this new fangled 3D printing. The Digital world merely amplifies an age old problem which reappears with alarming regularity with each new shift or breakthrough in technology. However, this particular incarnation also begs the question of whether the concept of IP is intrinsically flawed in a digital universe
Key Trends in society / technology / business
In any discussion on this topic (i.e. IP and the digital economy), you’ll invariably pick upon certain trends as key catalysts for change, which typically fall into any of following groups: socio-economic trends, technology trends and business trends. If you don’t believe me, then go ahead and give it a try with any of the following trends e.g.: social media, aging population, real-time dynamic pricing, predictive analytics, digital transformation, 3D printing, and even “sharing economy”. Such trends are redefining how we live and do business in a digital world, but are they all merely symptoms of the same phenomenon?
How will law and regulation keep up?
Not very well, I’m afraid. How can we best apply governance to emerging phenomena such as Digital? To say it is very difficult would be an understatement, considering that these changes also affect the law, and law makers, too. This is a perfect example of what city planners and business school professors consider to be a “wicked problem”. Existing rules of society and international law struggle to encompass the global reach and impact of digital technologies whereby information can spread, at the speed of light, to all corners of the world heralding the lofty dawn of unified global thought, sentiment and action, or anarchy. In order to remain relevant and useful, the concept of IP needs a major rethink and rework to align with a dynamic digital landscape. However, this is not the preserve of a few sovereign governments, and more needs to be done (at an international, collaborative level) to even begin nursing any hope of having an impact on Digital and human cultural evolution.
Digital transformation and business model innovation
In my opinion, the future of business lies in the ability to reinvent itself and take best advantage of the constantly emerging game-changing technologies, products, services, and usage paradigms. One such avenue is via business model innovation – a technique that makes use of a simple business model canvas to articulate any business model, in a fast and dynamic way. Technology is no longer a barrier to entry, therefore the true measure of fitness must have to do with a business model’s flexibility and adaptability (for competitive advantage) in the digital universe.
In summary, and regardless of where I’ve held these conversations (e.g. at the Copyright and Technology Conference, or Digital Economy and Law Conference, and even at the BCS, Chartered Institute for IT), these same questions and concerns have become a recurring theme.
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Ps. I will look to delve into these topics at my next speaking event, on the 22nd of January 2014, and hope to provide further insight and provocative questions on digital economy and IP. Also, we’ll get to hear a speaker from one of the world’s foremost organisations at the forefront of Digital. Don’t miss it (or at least come by and say hello), if you happen to be in London on that day.
A Chat with Hargreaves
Yesterday, I had the opportunity to chat with Professor Hargreaves, mainly about the aftermath of his IP Review / recommendations, including proposals for a Digital Copyright Exchange, as well as his thoughts on how best to leverage the UK’s amazing Creative Economy. It certainly provided plenty of food for thought.
Our conversation took place at NESTA’s head office, where Hargreaves is a Research Fellow and can be found working, at least once a week, with colleagues on further research activities. This, in addition to his Chair at Cardiff Business School, keeps him pretty busy, and so I came prepared with three key topics / questions around which the conversation revolved, as follows:
Q1. What’s really happening with implementation of the IP Review recommendations?
Following the successful publication of the IP Review Report, plus subsequent adoption and support by Government, various pre-legislative activities / initiatives have been set in motion to help provide more detail around the definitive steps to be taken in order to implement the recommendations.
Q2. What about the Digital Copyright Exchange?
A feasibility study, led by Richard Hooper, is currently in progress and will help to determine the realistic potential for creating a Digital Copyright Exchange (DCE) capability. They recently concluded the diagnostic first phase of the study and published a report which more or less confirms, among other things, the existence of a real problem. The next phase, which started back in April is focused on identifying potential DCE solutions that can be used to address the identified issues .
Q3. What is really driving the Digital / Creative Economy?
Several things will have an impact on the digital economy, and various trends exist that will ultimately help to shape the creative economy both in the UK and abroad, including:
- Some of the larger creative industry players are becoming more pro opportunities, as opposed to being largely focused on anti-piracy.
- There exists a tension between global vs. nationalistic views of the Internet. However, the Internet is really a global platform, with varying levels of access / applicability, and most people will just have to learn to live with “the internet”, as well as increased transparency and the acceleration of technology-led change. E.g. HD video will eventually become as fast and easy to transfer as music or text, due to increasing bandwidth and processing power.
- There are many opportunities for the UK creative economy, but first we’ll need to find more effective ways of measuring the real value of the creative industry. For example, one of the 13 identified creative economy sub-sectors (i.e. Craft) was reported somewhere as having zero-to-minimal economic value, despite employing some 0.4 percent of the UK’s working population. Such constraints must be overcome in order to appreciate the real impact of the digital/creative economy
These points (as well as other observations / anecdotes / insight) made this a great way to spend 45 minutes, and a key takeaway for me was that UK’s creative economy is in great shape (when compared to the rest of the world), but there is no room for complacency, and an urgent need to figure out how to take full advantage of the digital opportunities for the benefit of an increasingly critical creative economy. To do this properly, it will be absolutely necessary to achieve a proper / better understanding of the real value (not just monetary) of creativity to the UK / global economy.
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Copyright & Technology: For info: I’ll be chairing a panel at the Copyright & Technology 2012 conference which is taking place in London on Tuesday 19th of June. The topic is: Content Security Challenges in Multi-Platform Distribution, and it should provide some good insights from the panel of experts. Do register and attend, if you can make it, else I will be covering highlights of the event right here on this blog, as well as on Twitter (just follow me via @judeumeh and/or the conference hashtag: #ctlondon201
Who needs a Digital Copyright Exchange?
I was kindly invited to attend a ‘narrow table’ discussion session about the key challenges facing innovation and startups when dealing with a copyright system that is clearly not fit-for-purpose in an increasingly digital world.
This event was organised by The Coalition for a Digital Economy (Coadec) and took place yesterday evening at the TechHub, in the heart of London’s TechCity and the fabled ‘Silicon Roundabout’.
- London’s “Silicon Roundabout”*
This session focused on teasing out the real needs (and supporting evidence thereof) for a Digital Copyright Exchange, as recommended in the Hargreaves report, which would help to address key challenges facing UK innovation and entrepreneurship in the world of digital. This is part of the diagnostic phase of an independent feasibility study led by Richard Hooper.
Attendees included entrepreneurs and start-ups (in music and other digital media) as well as participants from the publishing, legal, academic, public sector, and consulting industries. Highlights from the discussions include:
- Academic publishing – e.g. universities get double-charged for publishing academic works; i.e. for researching the content, which is provided free to the publisher, and again for the published work
- Costly clearance – e.g. according to one attendee, the British Library’s Sound Archives proportionally spent the largest amount of time negotiating / clearing rights for the materials, than on creating archive itself.
- Orphan works – DCE could provide a useful mechanism for managing orphan works.
- Small / Medium Scale Enterprises – SMEs and startups experience the most difficulty with licensing, especially as they lack the resources and money to go through the hoops in negotiating with rights owners. E.g. the lack of a clear and comprehensive licensing system hampers start-ups in establishing their business models (this is particularly acute with music streaming services)
- Price versus value – Collecting societies may not have the right pricing models for music content. E.g. On-demand streams are considered more expensive than scheduled streams or download.
- Physical versus digital copyright – The old world approach of counting instances of works for remuneration does not translate well for digital copyright and new usage scenarios
- Rights owners are scared – they don’t wish to make the wrong decision and risk cannibalising their existing business
- Software Licensing – The DCE should also extend to include software and software licensing
- Navigation – This is a cross industry issue with copyright. A single platform approach to cover all licensing needs would be great as this would provide a single point of reference for information and guidance for users
- Government copyright – It was suggested that government owned IP (e.g. ordnance survey data, census, land or electoral register data) should be covered by the DCE
- Social Media Data – Increasing use of social media data streams for powering new applications makes it a crucial element for future services which will need addressing, sooner or later, perhaps in the DCE.
The above are only a few of the sentiments expressed on the day, and attendees were encouraged to send in their responses to the call for evidence as soon as possible.
Overall, this was a very informative session which seems to confirm something I’ve often stated, which is that the key role of any new digital copyright mechanism should be to simplify and facilitate the use of copyright material within and outside the digital environment. If the Digital Copyright Exchange had those as key principles, it would go a long way to ensuring successful outcomes and delivery of the promised benefit of over £2 Billion to the UK economy.
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*Note: Image adapted from – Original Image © Copyright Nigel Chadwick and licensed for reuse under this Creative Commons Licence.
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