Breznitz’16 [ Dan Breznitz, political scientist and Professor of Innovation Studies at the Munk School of Global Affairs, January 27 2016, “What the U.S. Should be Doing to Protect Intellectual Property”, Harvard Business Review, https://hbr.org/2016/01/what-the-u-s-should-be-doing-to-protect-intellectual-property, TP]
The U.S. has produced pages and pages of IP regulations, of course, but it stands alone among developed countries in failing to ensure that its technologies become globally dominant and that the fruits of these ideas accrue first to its citizens and corporations.
For example, in the late 1980s, a U.S. firm, Qualcomm, developed the world’s most advanced technology for second-generation mobile telephony, but European firms had an advantage: a coherent pan-Continental IP strategy that included mandating technology sharing among European competitors and setting the pricing and licensing arrangements to ensure rapid adoption. The strategy of promoting its technology helped Europe win this battle and gather the spoils in growth, profitability, and employment. Qualcomm, despite its stronger technology, lost out, because the U.S. didn’t have a coherent global strategy to encourage large-scale adoption or promote acceptance of its technology.
In terms of IP policy, little has changed since then. As for why the U.S. still lacks such a strategy, that’s a matter for debate. A key factor is intense resistance in some political circles to government actions that suggest industrial policy or planning – an aversion that was confirmed during the George H.W. Bush Administration’s debates on policy toward high-definition television development and adoption. The Administration not only ignored industry calls for an integrated approach to developing technology to compete with Japanese and European inventions but also fired acting DARPA director Craig Fields, who strongly supported the industry position.
Whatever the reason, the U.S. should move quickly to address this shortcoming. With the coming “internet of things,” fifth-generation mobile, and the looming expiration of many core mobile and internet patents held by U.S. firms, it is essential that the U.S. do all in its power to ensure the continued competitive strength and dominance of American firms and their technologies. Like large corporations, the U.S. needs a strategy that maximizes profitability by addressing both IP’s offensive aspects – including working to embed protected technologies in global standards so as to gain a sustained advantage – and its defensive aspects, which include deploying lawsuits or license refusals to prevent imitation.
The potential benefits should be obvious: IP is a cornerstone of the global economy, enabling efficient transfer of knowledge, monetization of discoveries, and rewarding of creators. An estimated 80% of the value of U.S. corporations lies in their IP portfolios. The risks of failing to adopt a coherent strategy should be just as obvious: declining innovation, contracting international trade, and stagnant growth.
The primary goal of current U.S. regulations is, as it should be, to strike a balance between disseminating knowledge and rewarding private effort. Nonetheless, our national interest calls for a comprehensive IP policy that goes a step further. Such a strategy would support U.S. firms within the agreed-upon bounds of the global economy and intellectual property, helping to realize more of the growth and job-creation potential of America’s profound innovation capabilities.