Just give it all away
The NY Times, carried a story on 11 April, on IBM hopes to profit by making patents available free (access it here). ABSTRACT: “IBM plans to announce it is making 500 of its software patents freely available to anyone working on open-source projects, like popular Linux operating system, on which programmers collaborate and share code; analysts say new model for IBM represents shift away from traditional corporate approach to protecting copyrights, trademark and trade-secret laws; estimate IBM collected $1 billion or more last year from licensing its inventions; IBM senior vice president John Kelly calls patent contribution beginning of new era in how IBM will manage intellectual property; company was granted 3,248 patents in 2004, far more than any other company.”
When “Big Blue” starts getting it, then everyone needs to understand the new era has come. This is the connection economy. Protecting WHAT you know is no longer the best competitive advantage. Your competitors will work it out anyway, and will find a way around your copyright protection sooner rather than later.
When IBM started selling computers, they actually didn’t sell them – you had to lease them. They felt the value was in the machines themselves, and they wanted to keep that value as theirs. They soon realised that hardware commoditised.
Most software that you buy, if you read the small print, works that way as well these days. The software company, such as Microsoft, actually still owns the software – they just lease it to you to use. That’s why they’re prepared to replace (they call it “refresh”) any broken or scratched CDs with “their” software on it. (The music industry thinks that they can use the same model for their sales – that’s legally what happens, they lease the music to you. But try and get them to replace a scratched CD and see how much they understand that model of theirs). But this is now changing too, with the advent of open source solutions.
By making their patents available, IBM are illustrating that they’re ready to take the next step. To make the intangible knowledge of the waning knowledge era available free-to-air. (I say “waning” not because knowledge is not important, but rather because it is becoming commodotised, freely available and is less and less a source of competitive advantage). What benefit for them? Besides making a LOT of friends in their primary client base, and contributing the forward momentum in their industry, and undermining their arch-enemy Microsoft, and expanding human knowledge and acheivement? Besides that? Well, they get the benefit of attracting some highly talented and enthusiatic bright young things to connect with IBM (when they say “give away”, you must know there are conditions that allow IBM to connect and benefit – nobody begrudges them that). They get the benefit of being able to link their current capabilities with the future, as they watch (even from a distance) how some of what they have been working on and thinking about goes places they couldn’t have taken it.
And did I mention the friends? IBM is my new hero! In a connection economy, with people like me, that counts for a lot.
((Yes, this is being written on an IBM Thinkpad. Last year it would have been a Dell, and the year before that a Compaq… If IBM keep it up, they may just have tapped into my loyalty center. At this rate, next year’s blogs will also be written on IBMs, probably using Linux with Open Office…))
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Question! What other indutries need to be looking at this? That’s when it becomes really interesting. The software world certainly are the leaders, but what happens when….
*The entertainment industry get their minds around it, or
*The mobile phone world starts to give us the ability to be ‘base stations’ and we have FREE communication, or
*GM seeds to grow crops, or
*Books and education, and
…the list is a long one, and certainly has me excited at the prospect of IBM and others (read me and you) changing our world………