Science fiction often says more about the time in which it was written than the future it purports to describe. It is easy to see why flying cars caught the imagination of the fifties and sixties. Car ownership was spiking and commercial air travel was spreading. Kanye West recently stated in an interview that “the internet is the flying car of our time” which is to say: we got something better. And the pace of change is staggering.
This year, the Federal Aviation Authority, the body that regulates air traffic in the US, has proposed a framework for the commercial use of small unmanned aerial vehicles – “drones” as they’re more widely known. The Stockholm Chamber of Commerce has recently published a report urging Swedish legislators to act and establish a regulatory framework, lest the city falls behind in the drone race. Coming from an almost complete ban, we are unlikely to see anarchy in the skies. Nevertheless, just a partial easing will transform several businesses; from home surveillance to crop dusting to snail mail and delivery services. Some people will lose jobs, others will find new ones that never before existed, and a few people will earn a lot of money.
New business models are chafing against established ways of doing things – and many incumbents are defending their territory through legal action. Uber has been banned in France, Spain, the Netherlands and India. Motivations range from “performing unlicensed business operations” to “unfair competition”. Tesla’s distribution model has run afoul of the cartelized structure of auto dealerships in parts of the US, earning it a sales ban in the state of New Jersey. In Sweden, a court has made it illegal to rent out an apartment without getting permission from neighbors in the same building.
Digital disruption is bearing down on traditional services, big time. Haven’t we seen this before somewhere?
Fourteen years ago, Napster lost its final legal battle and was forced to shut down. A year later the company declared bankruptcy and sold off its assets. Owners of intellectual property around the world rejoiced while pirates, hackers, and internet activists got organized. Filesharing, however, did most definitely not go away. Record sales kept on dropping, pushing content owners to follow the consumer and expand access to entertainment to new platforms. Some of these services, like Spotify, were in fact built on technology first popularized through online piracy.
For all the controversy, the piracy wars only really affected a pretty small share of society and the wider economy. Yet, what happened in the world of intellectual property gave us a small taste of how digitalization is about to reshape the “meat” world.
What can established businesses learn from the first wave of digital disruption in intellectual property?
The start-up ethos of “move fast, break things” is aimed at squarely at you. Break yourself before the competition does. Challenge yourself to tear down your business model and start all over again – would your business look exactly the same starting from a blank canvas?
Stop wasting resources fighting to preserve models that have been rendered obsolete. You might win the battle, but you will lose the war. It is not fair to consumers or your business in the long run to maintain the status quo “because it’s the way it’s always been”.
Security, privacy and ethics are key differentiators in the digital marketplace. The intellectual property industry’s first stumbling steps toward digital media gave us terrible integrity-comprising DRM solutions. Don’t make the same mistake.