It’s an interesting position, and one that seems to confirm indirect evidence we see today in phenomena like open source and wikis – maybe intellectual property rights that are too strong are preventing, rather than supporting innovation?

It should be noted that IPRs are a means to an end, and not an end in itself. The protection (monopoly) offered by IPRs to their creator, are supposed to ensure that, through this protection, innovation is rewarded, and that more innovation occurs as a result of that protection and reward.

The balance should be that, because of IPRs and the protection they offer, we see more innovation rather than less.

However, in many debates on IPRs and their protection, it is assumed generally that “more protection = more innovation”. Is that really the case, or is there a risk of overshoot?

As always, the burden of proof is on those who claim that something is true. So: “stronger IPRs mean more innovation”, not a statement of fact, but that which must be established.

Quod erat demonstrandum.

It would be good to seem more contributions to the debate, rather than entrenched positions.

If you own it, does that mean you can do with it what you want? Are you allowed to change some or more of its software? Can you install what you want?

If you really own what you paid for, the answer is of course “yes, you can” (but don’t come complainin’, it’s at your own risk).

However, many providers, and most notoriously, Apple, would like to see things differently.

They think you don’t “own” your hardware, you just have the right to use it. Same thing? Not quite.

According to Apple and others, when you buy their hardware, you should only install software, Apps, or other stuff that they approve off (and for which they receive some money).

How does that work? Well, you may technically own the hardware, but the software (including the operating system, or any firmware that allows you to really use the hardware), is never really owned by the buyer. The buyer only gets a license, a right to use.

And that right to use can, and almost always is, made conditional. You agreed to those conditions when you clicked the “I agree” button on every bit of licensed software installed on your hardware.

Obviously, there’s never any real choice – successfully installing the software can only happen if you “agree” with the text of the license, which, of course, you have read and understood thoroughly (if you did, give me a shout, I wouldn’t mind knowing which part of my birthright I signed away as well).

But now, freedom beckons.

The Register of Copyrights of the US Congress has decided that circumventing or breaking free from the technical restrictions used by the likes of Apple to prevent you from installing non-officially approved Apps is not illegal, and does not expose you to the draconian penalties imposed on breach of copyright as provided under the copyright enforcement laws (in the words of those horrible cinema movies about copyright theft, you are no longer a terrible criminal, putting thousands of jobs in the creative industry at risk).

How?

Because, as long as you do it for yourself, to install a program that you otherwise can use legitimately, jailbreaking is considered “fair use”.

Basically, you own not only the hardware, but also, to a certain extent, the firmware installed on it. The manufacturer cannot stop you from choosing yourself which software to install (or not install), and they cannot force you to pay for only “approved” apps.

Something tells me that this would have an important effect on business models used for products like Apps, but also for enabling software.

It is an interesting contribution to the overall debate: do IP rights enhance or limit innovation?

It seems that, in this case, limiting the scope of IP rights would promote innovation. It may not be the kind of innovation Apple or another major player particularly desires, but as far as I can recall, nobody appointed them as gatekeepers.

If only for that reason, the decision to hand owners of hardware a “get out of Jail Free” card is to be cheered.

At the same time, the Wylie literary agency has announced a number of big publishing deals bypassing the traditional publishing houses, and going straight into online publishing.

So, e-books are now more important than traditional books. More e-books are sold, and more money will soon be made from e-books than traditional books.

So what will happen with the traditional publishers? Will they go the same way as the music industry (a decline of more than 50% in less than 10 years)? Or will it go even faster?

One reason often put forward why this may not necessarily be the case is of course the selection role played by traditional publishers.

We all have that book in us – that’s an awful lot of books, and if we’re honest, we know that a lot of those books should maybe be written, but not necessarily read – or published.

However, those who think that traditional publishing will survive, miss three important points of the technological revolution around e-books.

The first is the low cost of publishing. As with music, the cost will drop to zero. Entry into the market, and the possibility of piracy, will also have a big effect on e-books. Technical protection against piracy? I’ll believe it when I see it.

The second is the role of technology. There is no reason why a clever publisher (or IT person) would not develop a software application that would do most of the selection of publishable material for you. I’m pretty sure it is possible for a clever algorithm to be developed, that will be able to select, between millions of manuscripts submitted, the ten (or hundred) candidates for blockbusters, or literary talent, or both.

The third is the role of crowdsourcing. When everyone will be able to post their writings (as an e-book) online, the power of crowdsourcing will be able to play an important filtering and selection role.

So I’m not convinced that publishing, as such, has much of a future.

I believe this model is very unsatisfactory.

Why? Because it does not really distinguish between the different aspects that constitute the specific value proposition of the software concerned.

Whether you offer a software under a license or as a service is typically not really determined by the real value proposition, but by the way customers (are perceived to) want to pay for the software.

I want to propose a better model of determining which business model is appropriate for software, based on the three dimensions I see in software.

These three dimensions are: Technology, Functionality and Content. What do they represent?

For some software products, most or all of the value is in technological development. Examples are Operating Systems, development platforms, middleware, interfaces, etc…

Other products will mainly focus on functionality. Most software applications will fall into this category, from office applications over plug-ins to computer games, including most SaaS, which is functionality offered on-line.

Finally, some products will focus mainly on content. This will apply to a lot of Internet business (e.g. Wikipedia, but also Google and Facebook), but also to a lot of business intelligence software, databases and media content.

Of course, hardly any software belongs to one category only. Every offering will effectively be three-dimensional: the software will address some or more Technology issues, focus less or more on Functionality, and be based more or less on or around the Content created or manipulated by it.

However, positioning a software business on the right place of each dimensional axis of our 3D model will be essential in understanding which business model is most appropriate.

Each axis of each dimension will range from commodity to highly specialized or tailored.

Knowing where your software product sits in this 3D model, will allow you to understand much better whether the real value of the software is better captured in a license model, a subscription model, a content purchase model, or any other model.

Because you will know where to locate the real value created by the software.

And then, once you know this, you can integrate the correct protection (Intellectual Property) and license model to your business.

That can be done through any range of IP tools, from strict patents to fully copyleft open source.

As a result, when properly located in this 3D-IT model, the business will be able to identify its most valuable assets, protect them properly (through use of appropriate IP tools), and use them most efficiently in the business model

This is because the Written Code is generated by Writing Software, without human intervention on the actual choice of code used to express the functionality.

Human intervention is limited to instructing the Writing Software on the details of the functionality (the Specs).

Under copyright, only the actual Written Code could be protectable, not the functionality described in the Specs.

And since the actual Written Code is not written by a human being, and there is no human creativity involved in generating the Written Code, there is no copyright. The fact that there may be creativity involved in providing the instructions to the Writing Software, is irrelevant in respect of the Written Code.

It’s applying the distinction between an idea and its expression.

This week, I was asked by a client to review the licensing model of a software product.

It turned out that the client/provider was also offering a license to a development tool to its end-users. This tool enables the end-user to create additional functionality to an existing product (which must already be licensed from the client/provider).

An end-user challenged the IP ownership of such additional functionality to be created by the tool, and wanted to own the IP (rather than the client/provider, who standard claims IP on any functionality created by the tool, even when such functionality is created by end-users using the tool licensed by them from the client/provider).

However, according to my theory on who owns software written by software, the question is moot from a copyright point of view. Nobody owns copyright in the functionality created by the tool , because there is no copyright. Such functionality is expressed through Written Code, i.e. created by artificial intelligence.

Besides, it would be unreasonable for the end-user to ask for a monopoly on additional functionality, added to a standard product. Copyright does not cover functionality in software, it can cover only the code through which functionality is expressed (if such code is written by a human being).

By analogy, you cannot claim a monopoly (IP rights) on a specific macro you’ve written in Excel – anybody can recreate such macro.

So far, so good (although the end-user may turn out to be unhappy about this).

But what happens when the client/provider starts to use this tool exclusively in the development of a whole new application? Does that mean that such application cannot be licensed under copyright?

Well, yes.

I wonder how many software companies out there are licensing stuff that has no copyright protection?