Mortgaging the Meme: Financing and Managing Disruptive Innovation

Traditional financing of innovative companies emphasizes the use of patents and associated intellectual property rights to secure debt and provide assets for valuation. Although the model suffices for incremental innovation, it does not account for investments in disruptive innovation, those that undermine traditional business models, supply chains or industry relationships. Disruptive innovation can be described as the introduction of a new conceptual idea or meme into an existing system that causes the system to be fundamentally altered. Assembly lines, air conditioning, digital film, and personal computers represent such innovations, all of which led to fundamental paradigm shifts. The convergence of globalization, a networked economy, and digital technologies have made disruptive innovation a threat in almost every industry. Changes to publishing, music, and television distribution – along with the rise of social media – highlight this transformation, but they are not alone; manufacturing, retail, payment systems, transportation and other industries are struggling with volatile upheaval caused by such change. Disruptive innovation, however, follows predictable patterns. Investors can anticipate these shifts if their financial transactions are properly structured and effectively documented. The model requires a holistic intellectual property approach which looks beyond just patents. It must explicitly incorporate the underlying meme, and it must account for the inflection points in the transformation pattern. Utilizing this model, inventors, private equity investment structures and established firms can maximize value and promote innovation. This article provides an overview of disruptive innovation from examples of the past decade, identify the underlying patterns of change common to disruptive innovation, highlight strategies to mitigate disruption for existing industry, and address the intellectual property securitization aspects to structure effective deals for both the investors and innovators

Searching Inside Google: Cases, Controversies and the Future of the World\u27s Most Provocative Company

For a company whose motto is Do No Evil, Google certainly has its share of detractors. The company is at the center of numerous controversies that will determine how people use the Internet, find information, and communicate with each other. Professor Jon Garon explores the cases that will shape Google’s future and the implications for copyright and trademark owners, including: the latest AdWords’ case Rescuecom v. Google, the proposed Book Search settlement, the Viacom v. YouTube copyright infringement case, and looming antitrust investigations. He also will speculate about the future of Google as it consolidates its control over online search and advertising and expands into telecommunications, mobile devices and cloud computing

Playing in the Virtual Arena: Avatars, Publicity, and Identity Reconceptualized through Virtual Worlds and Computer Games

In many respects, the commercial and social interactions within virtual worlds are essentially the same as those interactions conducted face-to-face or over less engrossing technologies, however, the immersive nature of the virtual world redefines the nature of the experience. Because virtual worlds mimic their bricks-and-mortar counterparts, they exhibit commercial attributes unlike those of plays, television shows, or motion pictures. To the extent that there is commerce conducted within the medium, the historic separation between commercial conduct and expressive speech must be reconceptualized. In the first instance, such legal line drawing will necessarily be done with crude tools, so this article suggests that just as the theater and motion picture industries turned to collective bargaining agreements to provide a more refined set of rules for professional content development, the entertainment content created in virtual worlds will benefit from similar collective bargaining solutions to legally difficult conundrums. The article provides an overview of virtual worlds and the legal framework for the regulation of content ownership; addresses the tension between the speech and property rights associated with the participants in this new art form, identifying what the law suggests and how it should evolve through case law and legislation; and suggests the steps that can be taken through private ordering collective bargaining arrangements to further clarify the protections for professionals associated with this developing new medium

What if DRM Fails?: Seeking Patronage in the iWasteland and the Virtual O

Section 1201 of the 1998 Digital Millennium Copyright Act provided sweeping protection for technological measures or virtual locks on digital content to protect the entertainment industries-including music, films, games, and consumer electronics. Manufacturers use digital rights management (DRM) authorized under the law to lock down all software embedded in products, movies on DVDs, and audio files sold on iTunes and other Internet sites. DRM unfairly extends copyright and that legal protection is unnecessary to the robust development of new creative works Critics of the DMCA have charged that the law has extended well past its anti-piracy role to undermine fair use, threaten free speech, and thwart product interoperability. Embedded in the debate are philosophical assumptions about the role of copyright to incentivize authors, musicians, artists, and other creators, as well as the role of law, technology, and social norms to enforce the customs of copyright protection. The article explains the arenas where the DMCA has benefited and hindered the broader cause of copyright and reviews the implications of copyright in the absence of technological measures for enforcement to see if there is any incentive left in the copyright regime

Mortgaging the Meme: Financing and Managing Disruptive Innovation

Disruptive innovation can be described as the introduction of a new conceptual idea or meme into an existing system that causes the system to be fundamentally altered. Assembly lines, air conditioning, digital film, and personal computers represent such innovations, all of which led to fundamental paradigm shifts. The convergence of globalization, a networked economy, and digital technologies have made disruptive innovation a threat in almost every industry. Changes to publishing, music, and television distribution – along with the rise of social media – highlight this transformation, but they are not alone; manufacturing, retail, payment systems, transportation and other industries are struggling with volatile upheaval caused by such change. Disruptive innovation, however, follows predictable patterns. Investors can anticipate these shifts if their financial transactions are properly structured and effectively documented. The model requires a holistic intellectual property approach which looks beyond just patents. It must explicitly incorporate the underlying meme, and it must account for the inflection points in the transformation pattern. Utilizing this model, inventors, private equity investment structures and established firms can maximize value and promote innovation. This article provides an overview of disruptive innovation from examples of the past decade, identify the underlying patterns of change common to disruptive innovation, highlight strategies to mitigate disruption for existing industry, and address the intellectual property securitization aspects to structure effective deals for both the investors and innovators

Revolutions and Expatriates: Social Networking, Ubiquitous Media and the Disintermediation of the State

This article explores the modern disruption of the state as the territorial control over its citizens and the restructuring of these social structures caused by social media and the unmediated communication of the digital age. Nowhere has this transformation been greater than in the Middle East, a region shaped by arbitrary political expediency and under tremendous popular pressure to redefine itself. But these transformations are not merely the populist uprisings of Tunisia, Egypt, Libya and Syria; they can be seen in economic transformations of Asia and economic harmonizations between Europe and North America. In all political, economic and social spheres, the role of social media and non-mediated communication has systematically reduced the role of the state and empowered a new network dynamic that will define the coming decades of the Twenty-First Century. A survey of Diaspora literature, however, suggests that while social media and Internet-age communications tools expand the role of Diaspora communities, they are quintessentially a tool. Some expatriate communities are engaged in peace building efforts and economic development while others are less tractable and using these tools to fund or promote armed conflict. These communities themselves are heterogeneous, so any generalization oversimplifies the community and its internal conflicts. The relative power of the state and the expatriate community are shifting away from the state – sometime evoking additional conflicts. Whatever the role, the significance of the Diaspora will increase and play a more significant part on their former homeland. The role will be determined by the conditions and the community

Rethinking Intangible Cultural Heritage and Expressions of Folklore: A Lesson from the FCC’s Localism Standards

This article reviews the underlying societal imperatives reflected in a policy of intangible cultural heritage and the intellectual property-like regimes being developed to protect these interests. It contrasts UNESCO efforts with more narrowly tailored efforts of WIPO and juxtaposes those approaches with the localism model developed under the FCC. While aspects of the WIPO protection efforts focusing on trademark-like and trade secret-like protections benefit the people and cultures these policies hope to serve, additional copyright-like protections will likely do more harm than good. Instead, global public policy will be far better served through emphasis on the FCC\u27s localism attributes of developing human capital to improve the quality of content being produced and encouraging local communities to focus on the content of their own choosing

Beyond the First Amendment: Shaping the Contours of Commercial Speech in Video Games, Virtual Worlds and Social Media

In Brown v. Entertainment Merchants Association (2011), the Supreme Court stated unequivocally that video games are entitled to the same broad First Amendment protections as those afforded to other media. But just as laws and regulations distinguish newspaper, magazine and television content from the advertising sold in those media, new policies are required to distinguish the communicative content of video games, virtual worlds and social media from the advertising and commercial purpose activity conducted in those media. Particularly in the area of publicity rights, states and courts have struggled to delineate those contours. This article outlines the emerging contours of commercial speech under recent First Amendment jurisprudence, highlighting the free speech rights of publishers, participants and players while shielding individuals from unfair commercial exploitation and protecting the public from misleading advertising

The Work Made for Hire Doctrine Revisited: Startup and Technology Employees and the Use of Contracts in a Hiring Relationship

Often, a copyrighted work is not created by one or even two authors but, instead, by a multitude of authors. Corporate brochures include text drafted by copywriters working in conjunction with other staff members, graphic designers, photographers and others. Most business works are created as a work made for hire, which vests the copyright in the employer rather than the employee. In most situations, the employment relationship will depend on an existing common law agency relationship between the parties. If an employer-employee relationship cannot be established, then the work for hire doctrine may still have a role for those works that fall into enumerated categories, as long as a proper written agreement is executed by both parties. With the advent of high-tech start-ups, virtual companies, and recent economic tensions, the courts have been rethinking the traditional rules developed by the Supreme Court in Committee for Creative Non-Violence v. Reid. Under these high-profile decisions, the common law rules of agency have been reconsidered and business owners need to adjust their practices to respond to this new reality

Localism as a Production Imperative: An Alternative Framework to Promoting Intangible Cultural Heritage and Expressions of Folklore

In the United States, the policy of localism – the legislative goal of fostering local community expression and competence to deliver local content – finds its home in the Telecommunications Act rather than either the Copyright Act or Trademark Act. Other nations have introduced values of localism into trade policy, content distribution rules, and international efforts to protect intangible cultural heritage and expressions of folklore. Jurisdictions in every continent are struggling to address the pressures of globalism through efforts to protect indigenous peoples’ and minority communities’ languages and culture. These efforts take many forms. Nations have introduced efforts to protect these interests into trade policy, content distribution rules, and the legal regimes of copyright and trademark. Some jurisdictions, for example, emphasize the need for historical preservation of particular culture and content. Other jurisdictions emphasize localism to promote domestic employment and economic growth. At the same time, however, other regulators are cloaking governmental censorship under the guise of protectionism. These efforts assume, arguendo, that some model of protectionism is necessary to assist these communities. Because there are many different types of intangible cultural heritage – local languages, tribal customs, religious traditions, folklore, styles of artworks, etc. – this assumption may be counterproductive. Particularly in our increasingly networked, global information community, assumptions of territorial protections must be reconsidered. This article reviews the underlying societal imperatives reflected in a policy of intangible cultural heritage and the intellectual property-like regimes being developed to protect these interests. It contrasts UNESCO efforts with more narrowly tailored efforts of WIPO and juxtaposes those approaches with the localism model developed under the FCC. While aspects of the WIPO protection efforts focusing on trademark-like and trade secret-like protections benefit the people and cultures these policies hope to serve, additional copyright-like protections will likely do more harm than good. Instead, global public policy will be far better served through emphasis on localism’s attributes of developing human capital to improve the quality of content being produced and encouraging local communities to focus on the content of their own choosing. http://ssrn.com/abstract=168717