Will 2012 see the end of the Cold War over Intellectual Property Rights?

From the European demonstrations against ACTA  and copyright to arguments on Open Software and patent the quiet Cold War over digital intellectual property rights (whether software or content) is hotting up. In the UK it is particularly important that those concerned over the issues respond to the latest Cabinet Office consultation on the use of Open Standards in public procurement. Mark Ballard has produced a good summary of the current state of play.

What is less clear from his article is the stakes at risk and the direct and indirect impact of the issues on the UK economy and public finances.

P.S. Andy Hopkirk has commented on the meeting referred to in Mark’s blog. He was the facilitator and is in a position to give a more balanced acount of what was said

kFirst what do we actually mean by Open Standards?

Until recently I had thought that when your patented orcopyrighted “solution” became an International Standard you had to make your intellectual property rights freely (and I mean “free”) available. I do not know when that changed but changed it has – with a vengeance. The  fees now expected appear to be not just those necessary to fund the various standards bodies. Theroyalties on proprietary standards are big business. More-over it appears that “access”may also be restricted in order to “encourage” the use of products and services from the proprietorand their licensees. It is this situation which lies at the heart of the controversy over the Cabinet Office position. The battle lines are emerging but are we about to see World War 1 style trench warfare or Sitskrieg followed by Blitzgrieg. And how solid are the alliances on either side?     

At this point I would like to ask a few “political” questions. 

How many are employed in the UK by those seeking to blockthe use of non-proprietary open standards and/or to prevent the collection royalties from theuse of proprietary standards based on software patents that are not recognisedunder UK law?

How do the fees to lawyers, lobbyists, patent trolls and those who own copyright in works they did not originally create, finance or bring to market, compare to the rights-owners spend on encouraging UK-based creativity.

In short, how do the net fund flows affect the UK balance of payments and economy.

Now let us move to questions on the more direct impact on public finances and qualityof service: equally important at a time of economic crisis.

How much UK tax do the royalty collectors pay?

How much taxpayers’ money would be saved by a move to openstandards?

In looking at the sums at stake we should not forget theSearch Engine market. Last week I attended a PICTFOR meeting on Search Neutrality. Unfortunately I had to leave early but not before my eyes had beenopened to the way that the some of the main engines are no longer neutral – theresults are adjusted to promote links to the products and services of the proprietorand lead advertisers. In consequence you may have to wade through several pagesof dross before funding the entries most relevant to your actual search. I havesince experimented with a couple of mapping and price comparison searches. Iimmediately realised the truth of what had been alleged although I also came torealise that at least part of the debate is a proxy war between past and current dominantplayers .   

Some years ago I remember being referred to an article onhow the great anti-trust suit United States versus Terminal Railroad Associationof St Louis, which prevented those who controlled the railway marshalling yards fromleveraging that domination to control road haulage from the freight depots,should be used to prevent those with similar control over key Internet resources,(such as peering centres, browsers or search engines), from using it to extend their control into application markets. I no longer have the link on file and could notfind it. The subject appears taboo and the search engines of today could notfind it. The relevant chapter of the Antitrust Review of America 2012  does not cover such issues.  

The long-term consequences of that case, which rumbled onfor decades, were as disastrous for the railroad companies asthey were beneficial for the United States economy as whole. We should notunder-estimate what is stake behind the emerging debates over InternetGovernance. As I suggested in my blog entries on the Big Information Society and in my response to one of Ian Grant’s bouts of paranoia, these can be seen as a proxy for using the enforcement of  current Intellectual Property Rights to progress thesurveillance agendas of the benevolent (or otherwise) elected (or otherwise) dictatorshipsthat now rule most of the world (West as well as East).

Given the current state of the UK economy it is criticalthat we do not allow ourselves to become a victim of a cold war may be about to burst into flames. Whether or not it is in the long terminterest of most shareholders, that war is one of the few current sources of new businessfor global law firms and for military software contractors faced by declining meger and acquisiaiton activity and cuts in defence spend.

Instead I owuld argue that we need to position the UK at the heart of the innovation revolution- using IPR reform to unleash and encourage, but also to reward, a new torrent ofcreativity. The HMG consultation over Open Rights policy, boring though itmight seem, will be the first indicator of whether UK plc is likely to be amongthe victims or among the victors as Brazil, Russia, India and China approach such issues with midsets similar to those of the UK in the 18th century and the US in the19th century.         


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