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Very Early Stage Technology Investing

Archive for the ‘Intellectual Property’ Category

Bosco! and Big Media’s Galaxy-wide Blind Spot

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I was researching a future post this morning and ended up lost again in the bowels of a big media company. I wanted to reference a Seinfeld episode and link to a synopsis or clip. Sony owns the show and it remains, even today, a great cultural commentary on so many things. I have introduced it slowly to my kids (11, 10, 9), editing out episodes with obviously inappropriate content, as a way to understand narrative structure, character development and how to make people laugh without saying “fart”. I am hoping to build an intellectual wall between them and Adam Sandler.

So I first go to YouTube and find some short clips from the appropriate episode, but I can’t find the exact scene I want to link. I don’t spend a lot of time looking for episodes online, but I know that Sony owns the show, so I check their site.  Surely they have some way to link to the episode, with some clip sampling as well. Not a chance.  Instead they have an “official site” that is horrible and offers “today’s episodes” and then a way to search for other episodes or explore the DVD, whatever that means. They are using an eye-dropper to provide content to the masses rather than make that content open and widely available. The “official site” doesn’t work when I find the right episode, so I can’t see the synopsis. Why, I wonder, can’t Sony find a more creative way to give me access to something I really want? How many people randomly are looking for a Seinfeld reference from a specific episode to include in a blog post, Tweet or Facebook comment? How many of the downstream readers of those social media references have never even seen Seinfeld? It was on in the age before mobile phones and all that has followed, so lots of young people have only a passing notion of the show. They might get hooked and pay to view an episode, record it in syndication or order the box set. Another potential novelty to Sony would be the ability to pay on the site to watch an episode.

I’m sure that somewhere at Sony they’ve signed a contract for syndication or selling box sets at Borders or Tower Records that somehow constrains the content. Jerry himself might be holding things back. The problem for all big media is that their trove of content is like the Library at Alexandria before Julius Caesar burned it to the ground. If no one can access your content then eventually the amount of new content simply overwhelms the aging stockpile. Big media thinks they should still control the consumption cycle. They view content as a scarce resource and think they have asymmetric market power. But in the digital age old media content will soon represent such a tiny fraction of available content.  Concurrently, consumers’ social/viral consumption habits will destroy big media’s market power. Scarcity and content control is wrong-headed in the extreme. We keep expecting this to change, but it’s glacial at best.

By the way, my quest ended when my next web search found a blog post on Esquire’s website describing exactly what I wanted. Of course, it was satirical. Oh, well, off to SxSW.

Written by Mike Venerable

March 9, 2012 at 11:33 am

Trust no one, get nowhere…

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I came across a story in the local paper this weekend about an inventor in Indiana who is suing Clorox and Bird’s Eye for “stealing his idea”.  His idea is a microwaveable container that uses steam to cook/heat frozen foods.  The story, from the Indianapolis Star, only reinforces the fears that many entrepreneurs feel about sharing their ideas with investors or big companies.

These fears are sometimes justified, as companies can undermine legimate claims and tie up inventors for years.  The movie “Flash of Genius” tells the story of Robert Kearns, inventor of the intermittent windshield wiper, who spent his entire life enforcing his patent claims against the auto industry.  By the time he triumphed in the 90’s, he had spent 30 years enforcing his claims, not always with success.  He spent $10 million on legal fees and eventually won about $30 million in damages.  But he died less than a decade after his legal victory.

Kearns was a victim, but sometimes the “inventor” is mistaken about the validity of their claims.  In the Indiana case the most telling aspect is that the inventor is not suing the companies for patent infringement, but rather for beach of contract for violating confidentiality agreements and unjust enrichment.  It is hard to imagine that these companies, involved in the packaged food industry for decades, did not have a variety of research ongoing into how to improve microwave meals.

Occasionally we hear from an inventor or founder who is overly concerned about protecting an idea or concept.  It is a legitimate concern, and anyone going down the inventor/founder path should have a basic understanding of how intellectual property law applies to their field of endeavor.  But at some point the kimono must open enough for judgments to be made.  Ideas that are properly protected are nearly impossible to steal.

Many early stage companies fear that venture capitalists are going to steal their idea.  Even the best ideas are hardly worth stealing, since the thief would lack the individual insight and creativity that led to the idea/business concept.  It is the rare idea that is really not being considered or advanced in some way by someone else at the same time.  How many search engines preceeded Google?  How many cell-phones preceeded the iPhone?  Execution and fate are often more important to winning than novelty.

Written by Mike Venerable

September 2, 2009 at 9:00 am