Google Doesn't Rely On Intellectual Property For Its Leadership Position

from the stop-saying-it dept

In the various debates we have on intellectual property, we often hear people insisting that Google's dominance is based on intellectual property -- even though there's very little evidence to support this at all. The people who make this argument are guilty of the same mistake made in studies that count all things covered by intellectual property laws as if they only exist because of those laws. Entertainment industry lobbyists, like The Copyright Alliance, love to tout that "$1.52 trillion of the nation's GDP" comes from intellectual property. But that's both misleading and wrong. The number itself is exaggerated, but it also gives credit to intellectual property for anything that touches IP. For example, when we dug into the methodology, we saw that the study counts things that clearly were not because of IP law: such as furniture and jewelry. Are the Copyright Alliance and its entertainment backers really trying to suggest that without copyright law we would have no furniture or jewelry?

Similarly, Google often gets lumped into these discussions, with people insisting that its position in the market is due to copyright and patents. Google does, in fact, have a bunch of patents -- but I watch the patent app filings and patent grants on a bunch of different companies each week, and Google tends to file significantly fewer patents than other comparable companies. Furthermore, I don't know of a single case where Google even hinted at or threatened another company with a patent infringement suit (if there are any examples, please let me know). It appears that Google has focused very much on just using patents for defensive purposes, since it is regularly sued by others for infringement.

Matt Asay, over at News.com, has now highlighted an even stronger example of how Google is showing that it's not relying on intellectual property, but on execution, for its business position. The company recently open sourced its Closure tools, which it uses to build its web services (disclosure: I'm good friends with one of the folks involved in this project, and yes, he reads Techdirt regularly). As Asay puts it:

In many ways, Google is giving away the recipe to those that would like to build a Google clone.

The problem? Google is so much more than software.

In fact, one of the primary reasons that Google can write and open-source so much software is that it isn't a software company. Not even remotely. I could have every line of Google's software, both open source and proprietary, and I couldn't hope to compete with Google.

Google is what Google does with the software, and not the software itself.

It's the execution, not the idea. It's the service, not the code.

In fact, this sort of activity confuses the hell out of companies that do rely on intellectual property. Again, Asay makes this clear:

Google and Red Hat have moved beyond software. Software enables their operations, but software doesn't define such operations. Google, for its part, is open sourcing Microsoft, one line of code at a time, and Microsoft hasn't a clue as to how to respond, because it only knows the old world: competition through better IP.

And that -- right there -- is the key point we keep trying to make around here. You don't need to rely on intellectual property. And, if you do, you are opening yourself up wide to competition that doesn't rely on IP and innovates in a way that simply cuts your legs out from under you. Yet... we'll still hear stories for years about how all of Google's billions are because of its intellectual property, even as it gives away more and more of it each and every day.

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Can You Copyright Movie Times?

from the and-if-you-could,-why-would-you? dept

One of our readers, Jay Anderson, writes in to let us know that he was working on a useful little app to let people put in their zip code, find local movies, and click through to buy tickets. In doing so, he found an undocumented API on a major site that provided all the relevant info, and linked back to MovieShowtimes.com, a site owned by West World Media. Anderson contacted the site to find out if it had some sort of affiliate program since it was reasonable to assume the site would be happy to gain some free traffic. No such luck. Instead, he got back a threatening letter, warning him that he was opening himself up to copyright infringement damages that could be upwards of $600,000 per month.

You need to know it is unlawful and a violation of our copyright and intellectual property rights for you to build a system that obtains our content from any source other than to obtain an expressed license from West World Media for legal usage of our content. Each violation of our Intellectual property rights allows us to collect damages of up to $150,000 per infringement. This would equate in liquid damages of over $600,000 per month if you violate our rights.

Anderson responded, asking the company how factual information (such as movie times) could be covered by copyright, and the company responded:

"It is not our responsibility or duty to explain complex US Intellectual Property rights law, we however enjoy many protections from them. I suggest you hire an IP attorney to explain it to you. From your response, it seems to me you have no intentions of moving forward in a legal manner. We closely monitor any and all usage of our content and if we discover your unlawful usage of it, we will exercise our rights to their fullest extent of the law."

Now, obviously, the company makes its money by licensing its database of showtimes to certain websites, but that information is factual, and it's difficult to see how the company could hold a copyright on it (at least in the US, where there's no real "database right" -- elsewhere... perhaps a different story). There's also no creative element in merely listing showtimes, and it's hard to see how they would possibly be covered by copyright. If the problem is that the company is upset that its business model can't handle other people sending it traffic, that's a business model problem, not a copyright problem. Time to redesign the business model to take a cut of sales, rather than to rely on artificial copyrights. Unfortunately, though, it doesn't stop a company from making such threats...

Separately, this reminds me of the fact that, just a few months ago, we were talking about how the movie times in newspapers were apparently paid advertisements by the theaters themselves. So, this seems like an odd switch as well: newspapers get paid for movie listings, but websites have to pay for them? How does that work?

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Virgin Does Music Deal With Universal; Everyone Involved Forgets The Past

from the let's-look-back-a-bit dept

There's lots of news coming out today about how UK broadband ISP Virgin has signed a deal with Universal Music to allow unlimited access to Universal Music's catalog (downloads and streams) for a set price. Various execs and politicians are talking it up like it's the greatest thing ever. It's as if they think that people can't remember back just a few months.

That's because it was just a few months ago that Virgin was set to launch a similar offering that included all of the major record labels, but then a few of them got greedy and said they'd only agree to it if Virgin also employed Deep Packet Inspection (DPI) techniques to track the file sharing and cracked down on any sharing of MP3s. Virgin resisted -- after all, just a few months before that, it had insisted that it would never cut subscribers off the internet for file sharing. So... wouldn't you know it... a part of this plan is to cut file sharers off the internet.

So, let's take a look at this "wonderful" and "amazing" new agreement. You get a vastly limited catalog (only Universal Music -- and who the hell knows what label their favorite bands are on these days?). It's not clear how the usage is tracked, but given the earlier reports, we have to wonder if it involves DPI spying on your usage... and Virgin is committed to cracking down on file sharing and even "temporarily" cutting off access to the internet (Virgin claims its okay, because the cutoff is only "temporary"). Perhaps there are some folks out there who will sign up for such a service, but it's difficult to see who. They aren't offering any benefits or additional value.

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Microsoft Tries A 'First One's Free' Strategy To Lure Startups

from the you-know-you-want-to-try... dept

Microsoft certainly recognizes the fact that most startups these days are automatically gravitating to a LAMP infrastructure (Linux, Apache, MySQL and PHP). So, now it seems to be trying out a new program to lure startups by offering them free software for a few years and combining it with additional services that they hope will appeal to startups. It's an interesting approach, though, in the long run, it still seems like they may have the equation backwards. While they are giving some stuff away free initially, the ultimate goal is to lock companies into paying for infinite goods like software, rather than scarcities like services.

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People Overestimate The Value Of Content; Underestimate The Value Of A Service That Makes It Useful

from the time-to-understand-the-difference dept

A silly mini-battle broke out among some bloggers over the weekend concerning some new RSS-feed aggregation site. It's a battle that plays itself out every few months or so, and which we've tried to discuss a few times in the past. What happens is that people get angry because this aggregator (or reader, or browser or whatever) is actually able to build a business around other websites' content. And that gets plenty of folks, including those who I quite frequently agree with, like Mathew Ingram and Tony Hung, to complain that the service has somehow "crossed a line" by building a business "on the backs" of other people's content.

The problem, however, is that this is simply untrue. If it were true, then a ton of online sites would be guilty of the same thing -- including Google. But the reason it's not true is quite simple to understand: if all they were doing was reusing other people's content, then there would be no incentive or reason for people to visit these sites. Why go to these sites when you could just go to the original sites? The reason that people go to these sites, and the reason why these sites can build a business, is because they add value to the content in the form of some sort of service that does more with it. They're not building businesses "on the backs" of others' content, they're building services that people find useful as a way to find, interact with, share or comment on that content.

Unfortunately, though, as we see time and time again, people seem to overvalue the content and undervalue the service. That's why you have newsapers that sue Google, even as it's bringing them more traffic. They overvalue their own content, and undervalue the service that Google is providing: making it easier to find their content. The same is true of just about every other service that kicks off this kind of debate. The service is making it easier to consume, read, share, comment on, organize, find or interact with the content. Otherwise, it wouldn't get any users. The content is important, yes -- and valuable too -- but don't underestimate the value of the service that it performs on that content. So the next time one of these fights breaks out, pay attention to whether people are unfairly blaming a site for "stealing" content, and notice if they're undervaluing the service itself.

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