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Thursday, 13 January 2011

Global Forum on IP: Report 1

After a harrowing 20 hours of flight time from New York absent any cat naps, this IPKat made it to Singapore for the IP Academy's 3rd Global Forum on Intellectual Property last week where she spoke on a subject dear to her and the IPKat’s heart – that of IP information overload. Unfortunately, flying from the US necessitated her arriving a day earlier to make it in time for the speaker’s welcome reception where, with a glass of wine in hand, she watched the sky above Singapore’s dazzling city lights break into flashes of light during a tropical thunderstorm. At the time of writing, seated at the back of the impressive Collyer Room at the Fairmont Hotel with laptop in paw, she prepared herself to report on the events, gossip, and intrigue of two days of fiery global IP debate.

In what will be the first of four instalments, the IPKat sets out some events from the first morning below.

Opening

The theme of the conference, “Turbulent Times: Onwards & Upwards for Intellectual Property”, focused on the changing and turbulent financial markets and impact of social media on intellectual property. Before launching into the content of the conference, this IPKat has to mention how incredibly organized and well-produced the conference was; there is nothing like it in the UK or Europe – it really does feel like the Oscars of the IP conference world.

The conference opened with a very impressive video introducing the importance of IP and the IP Academy including a great shot of the Deputy Chairman and External Director of the IP Academy, and the IPKat’s friend, David Llewelyn. David opened the conference by emphasizing the truly global nature of the conference with presentations coming from 35 countries and the increasing importance and development of IP law in Singapore, to whose government he paid tribute to in advancing IP law.

Mr K Shanmugam, Singapore’s Minister for Home Affairs and Minister for Law gave the opening address where he stated that 2010 growth for the region was 8.8% and is projected to continue to grow in 2011 which underpins the shift of gravity to and emphasis on the importance of the Asian markets. Innovation-centric growth in Asia will be a foundation of the growth. IP assets in Singapore represent 60-80% of a business's value, the valuation of which will be now included in all business valuations in the future. In 2010, WIPO opened an office in Singapore which represents the further development of IP in the region as a tool for economic growth. The office provides expert determinations, dispute resolution and training. Singapore was also one of the negotiating parties in the Anti-Counterfeiting Trade Agreement (ACTA). These examples were cited to show the increasing seriousness with which the role of IP plays in Singapore.

Following the opening address, an amusing moment was witnessed by all where the opening speakers placed their hand on a white globe which turned blue upon their unified touch – the IPKat tried to wrangle that globe into one of her carry-on bags but without success.

IP & China: Getting Ready To Rumble in the New Asian Decade

The always pertinent topic of IP and China was the first keynote address given by business school Professor Peter Williamson of the University of Cambridge who focused on three topics: evolving innovation activity in China, trends in Chinese IP rights, and the look to the future. Turning to the first topic, Williamson stated that he has spent 25 years in China working on innovation issues. China was originally focused on cost innovation strategies by using their low costs business model to innovate their business models. He illustrated this by the looking at Digital Direct X-ray Equipment (DDX) whose market was initially dominated by GE and Phillips. These companies used the technology for things such as heart scans with the machines costing around $400,000. Chinese company Zhongxing obtained a variation of the technology from its parent company via a Russian partner. The technology obtained was considered obsolete in the West (the IPKat is not sure what was meant by “obtained”). By using this obsolete technology they re-engineered it to compete with the advanced technology and to then enter the mid-stream market with a machine cost of $20,000. The mid-stream market was a section of the market that the Western companies had not focused in and so Zhongxing was able to become dominant in this section of the market. Williamson rebutted some Western views that taking obsolete technology like this is not innovation because they were not changing or developing new technology, just improving the old. Surely, taking what has come before and improving on it is innovation?

Several similar case studies later, Williamson turned to IP rights in China with a slide on the increasing trend of Chinese companies applying for patents; a trend which is steadily growing. Williamson stated that the granting rates for patents in China were comparable to that in the UK which he seemed to suggest meant that the quality of the patents granted were comparable to that in the rest of the world. The IPKat says just because the number of patents being granted are similar does not mean that the patents are being similarly assessed as they are in the US or Europe. A pie chart was displayed showing that as much as 23% of patents applied for were from academic institutions in China compared with 7% in the US. Why this may be, was not fully discussed so if readers have any thoughts please let the IPKat know. Also, interestingly Williamson stated that the number of co-applicant or collaborate filings in patents is much lower than that in the US.

Williamson concluded his informative talk by saying that the real prize for the future is to take technology from the West and combine with the business and innovation strategies in China to develop products for the global market. Williamson also suggested that companies looking to collaborate with Chinese companies should focus on commercialization of products, not necessarily the innovation of products, because where China has excelled is in the ability to conduct large-scale experimentation in a very short amount of time. He also suggested that Chinese companies will be starting to enter the cross-licensing game which will be a very big growth area in China as the isolation of Chinese innovation begins to end.

The Internet and Copyright – Problem Solved?

The second keynote speech was a fiery debate entitled “The Internet and Copyright – Problem Solved?”. The IPKat wouldn’t have thought there was much debate on this topic given that the answer is surely “no”, but the panelists of Andrew Keen who was described as “Internet Guru and best-selling author” and Harold Feld, Legal Director of Public Knowledge proved to have more to say then just that. Mary Wong from the University of New Hampshire, School of Law moderated the session.

Feld (picture, left) introduced the concept of creative destruction which has seen industries becoming entrenched and resting on the laurels of previous innovations and business models. This entrenchment destroys the future prosperity of innovation as technology advancements leave the old models behind. He argued that we have achieved this model of creative destruction and now no rights holder feels secure and this is a good thing, because it is this anxiety and pressure that results in the pressure to create and innovate. Of course innovators need to be rewarded, so it is important that concepts of copyright be preserved in the digital world but we must reject temptations of those who see business models threatened by putting a stranglehold on the internet and the necessary creative destruction. There is an enormous amount of copyright works being created on the very thing that is “threatening” innovation. Held cited the example of YouTube, where some rightsholders who were threatened by them initially, later embraced the technology and innovation by entering into partnership with them. It would be a shame that in the name of profitability and in the name that no infringement ever takes place, creativity that has flowered on the internet would be completely destroyed. There is a cost of infringement and a cost of creation, and Held submitted that the balance between these two has been achieved.

Keen, citing Lady Gaga (right) as an example, stated that talent like her only dares to be creative and innovative because someone has invested money in her talent for which they are monetarily rewarded later (slightly simplistic, the IPKat suggests). The internet creates a problem where the creative talent has their creative product undermined by the likes of YouTube whose model, Keen stated, was premised on turning a blind eye to IP infringement. Keen thinks that we are turning into a culture of permissive intellectual property infringers and that Larry Lessig’s thoughts on the virtues of a remix culture is incorrect. Keen thinks that the younger generations do not see or understand the consequences of IP infringement and that in order to maintain the heroes of our youth, the kids today must pay for their content. This IPKat is sure many of her generation are very concerned of the need to maintain Lady Gaga’s multi-million dollar lifestyle, despite how much we love her and her music.…..

Feld responded by saying that he has not noticed Viacom going out of business because of YouTube or any other entertainment conglomerates going out of business. Instead they are now working for a living instead of relying on the old days where they had little competition. Keen then asked what companies like facebook are doing for musicians and artists – what are they doing for creative industries? Keen does not think they are doing anything, but anyone who uses facebook knows that musicians, TV programs and artists use facebook as a promotional tool for their fans which surely acts as an aid to creative talents’ bottom line for creativity. Keen states that a free culture is not a viable culture while citing the Wikipedia example and that there is a need to figure out how to monetize these products. Keen also warned of the danger of fetishizing the giving content away for free. Keen also said that cutting out the middle-man in models where artists can self-publish is a shame because the artists cannot just be ‘artists’ but they have to be skilled in self-promotion. Such a business model may mean that people like the Bob Dylan’s of the future may not be as successful because they also have to be marketers.

Feld stated that having grown up in era of public television who make calls for public contribution of money and expertise, he does not see the problem with free culture. Individuals who contribute to Wikipedia do so voluntarily; this does not mean a contributor’s content is being exploited. Wikipedia gives value and asks for value all for free and what is so wrong with this? Feld thinks that there is a large enough group of people who make this sustainable and we should be free to try and maintain this model. This IPKat also adds in response to Keen (picture, left), why is there always a necessity to commoditize and monetize content and business models? Not everything in the world has to necessarily be developed to achieve the consumerists' greatest good - that of achieving a profit.

Feld also argued that one does not strip search every customer leaving your store to ascertain whether they have figured out a creative way of reliving you of some items; the same should apply to the digital environment. Shoplifting for traditional merchants is an expense that has been factored into business models since time immemorial and such should also be factored into models on the internet. The IPKat went up to Feld after the debate and thanked him for this great illustration which she hopes he continues to use and develop in the future.

Want more IP intrigue? The second instalment will be published tomorrow!

2 comments:

Aaradhana Sadasivam said...

Thank you so much IPKat for the moment-by-moment account of the global event in Singapore. It is like re-living the conference all over again. As a permanent account of the matters that we discussed and learned during the conference, this post is a further opportunity for us to not only go back and re-live the golden moments of the conference, but also refer to them as and when we need to.

Global Forum on Intellectual Property is indeed Oscars of the IP. I have attended all of them...and look forward to attending them in the future as well.

Anonymous said...

IPKat comments "Not everything in the world has to necessarily be developed to achieve the consumerists' greatest good - that of achieving a profit." Agreed. But only art which comes from starving artists is not desirable either. We can fantasise about all the great art from poor artists who do not earn from their work. But what about all the great art which was never created because artists were forced to earn money in other ways to feed their family? It's too easy to conflate "profit" and "ripping off".
There is no easy solution (obviously!) but it's rather simple to suggest that others should give their talent to you for free so that you can show that art need not require a profit. It's funny how those who benefit most from such a system (the takers) are quick to attack the ones who lose (the givers) for their greed...

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