I realized not long ago, to my own surprise, that I had worked in intellectual property for nearly two years. Intellectual property. A field dominated by corporate lawyers and too many consultancies to count. Considering the vast literature on intellectual property (IP) , there is little need for long introductions. Essentially, IP is when the state grants artificial monopolies to individuals to exploit creative work such as scientific innovations, films, music, books, trademarks and designs.
Though many industry professionals recoil in horror when they read IP and monopoly in the same sentence, this is effectively what IP is. We grant monopoly rights, so the argument goes, in order to foster incentives for the creation of works that benefit society. Society needs ideas. People have them. The state grants a monopoly right to stimulate their economic exploitation. Far be it from me to question this sacred tenant of the much heralded knowledge economy. Some have . But these few are frequently painted as the lunatic fringe of a well-oiled free market machine that awkwardly defends creating artificial monopolies via state intervention.
IP influences our lives every day. Though often portrayed as a complex legal matter best left to lawyers, nothing is further from the truth. IP is profoundly political. It is an immensely powerful legal construct that can be used to foster technological innovation, stifle competition, restrict access to medicine and remove your YouTube video all in the same breath. Considering that IP is now enforced globally via the WTO’s trade-related aspects of intellectual property rights (TRIPS) clauses , some of its darker aspects should be known. The list is by no means exhaustive. Nor is it a call to arms to bludgeon your local patent lawyer. This list is, simply, a list of three facts to remember about IP.
1. We can accumulate patents without innovating.
With research and development (R&D) costs skyrocketing for new drugs and technologies, it is no surprise we have a patent system to reward innovators. Society benefits from innovations by facilitating their diffusion. Patents reassure innovators they will profit from this diffusion. Using patented technology without paying for it can result in astronomical fines. Think Apple vs. Samsung.
But what happens when someone can accumulate patents without innovating? Non-practicing entities (NPEs) accumulate patent portfolios in order to profit from infringement settlements and extract license fees. Derisively called patent trolls, NPEs have grown rapidly. NPEs sued less than 250 companies in 1998. By 2010, that number shot up to 2,600. Major NPEs like Intellectual Ventures own an estimated 10,000 – 15,000 patents. Some argue they aggregate rights to facilitate technology licensing. Yet, most of these companies contribute little to the economy except the dividends generated for shareholders from suing manufacturers.
2. We can patent biological organisms.
This concept received an enormous amount of press over the years. Reports suggest over 1/5 of human genes had been patented by 2005. Recent court decisions upheld that firms could patent isolated human genes. The same goes for seeds. Horror stories abound of farmers around the world being sued by companies like Monsanto for not paying license fees for crops they have been growing for generations. Patented seeds can produce higher yields and resist disease. But they can also be invasive and sterile.
Why not limit their reproductive lifespan to ensure farmers have to continue paying for legally protected seeds? The logic is devastatingly cruel and profitable. As powerful new gene sequencing techniques become increasingly cheap, there is no limit to the quantity of biological data that will transfer into private hands . There is opportunity for enormous medical progress. But at what cost?
3. We can centralize ownership of culture.
Copyright historically enabled corporations to accumulate vast repertoires of film, music and books. Take music: four companies – Universal, Warner, Sony, and EMI – control approximately 75% of the global music market. Pre-Internet, this situation was justified by reference to the investment necessary for production, distribution and marketing of content.
With communications technologies decimating these costs, one might expect a bright new future where the interests of a handful of corporations no longer drive the global supply of cultural content. Sure, the music industry is experiencing the rise of independent label market share. But don’t expect these cultural behemoths to go quietly into the night. End-user piracy litigation, digital rights management and centralized online distribution on platforms like the iTunes store shows the oligarchs are fighting hard.
Where We Stand
I have focused here on worrying aspects of IP and been extremely brief. I believe in IP. Artists should make money. Scientists should be rewarded for their discoveries. My patience runs thinner with companies that exploit the concept of corporations as legal individuals to accumulate huge patent, copyright and trademark portfolios. Enforcing their monopoly rights around the world, they increasingly influence how people create, transmit and experience cultural and scientific works.
Yet, new opportunities to promote public welfare using IP are on the rise. Open source software uses GNU GPL licenses to ensure all derivative software is free and open. Creative commons licenses protect artists’ rights while offering a greater scope of distribution and collaboration. These are just some of the more high-profile examples.
IP is here to stay. It will impact your life countless times before you even brush your teeth. It is not evil. It is a tool that is used both for and against the public interest. Yet, it is a property right justified with respect to social welfare. Let’s keep that in mind when we consider why and how we protect our ideas.
Photo Credit: Quapan