|For 2012, JIPLP's cover|
colour is this very
"Open minds, open innovation
Not so many years ago, the term “open innovation” was unknown to the intellectual property community. While the concept existed, there was little evidence that it existed, or that it was likely to gain any currency at all, before the publication in 2003 of Henry Chesburgh's Open Innovation: The new imperative for creating and profiting from technology. Since then, the term has gained momentum in common parlance. However it is only in the past year or two that open innovation is becoming something that is more widely and positively spoken of as something which a business might participate in, rather than as something rather strange and risky, to be indulged in by others — preferably in North America and the Asia-Pacific.
What exactly is open innovation? According to Henry Chesburgh, it is a paradigm that assumes that businesses both can and should use external ideas as well as internal ideas, and internal and external paths to market, when seeking to advance their technology. Since the boundaries between a business and its environment have become more permeable, it is increasingly for innovations to flow both inwards and outwards. In a world of widely distributed knowledge, no-one can afford to rely entirely on their own research: it makes better sense to buy or take a licence from other companies. In terms of outward flow, internal innovations which a business owns but doesn't use should be licensed out or shared through joint ventures or spin-offs.
As a way of doing things, this is not exactly rocket science and has been around for a long time. However, in the past this approach has generally been Plan B, when the preferred option of growing, protecting and monopolising one's own innovation needs to the point of self-sufficiency could not be achieved. The importance of Chesburgh's contribution is in the paradigm shift in corporate thinking: open innovation is portrayed as Plan A, the ideal option which both reduces R&D costs and focuses them more efficiently, which leads to improved quality and more consumer choice, and which is not merely open in the inward-outward sense but which encourages greater transparency of licensed technology itself.
It seems to me that one of the most interesting potential effects of open innovation is to shift the balance of importance as between different intellectual property rights. A closed innovation model places the greatest emphasis upon control of intellectual assets by a single proprietor: the exclusionary role of patents for inventions and, to a lesser extent, statutory design monopolies, are valuable tools for achieving this end, as is the role played by contract and general legal principles regarding the protection of trade secrets such as manufacturing know-how. With control of a market secured by such means, the role of the trade mark is relatively small. This is because a trade mark is not generally capable of excluding a product or a technology from the market: all it can do is to prevent its commercial exploitation under a particular name or origin-identifier.
Once open innovation is practised, the inevitable consensual sharing of technology diminishes the importance of the most exclusionary monopoly rights. Given the typical effects of open innovation such as the development of products and processes for an entire market rather than for a specific manufacturer, competing products will increasingly use the same parts and accessories, will operate in the same manner and will therefore decreasingly compete in terms of proprietary features which are difficult for the consumer to compare. At this point, the trade mark assumes a far greater importance since it is the one statutory right over which a business—even if it chooses to share its use through licensing or franchising—cannot afford to lose control. It is also the one intellectual property right which is capable of both storing and growing any goodwill which its owner attracts, thus enhancing a business's value".
If open innovation hasn't reached you yet, there's a good chance that it soon will. And when it does, be sure to keep an open mind when you assess its benefits".
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