In February I made my first visit to the Subcontinent, in Delhi, for the regional meeting of the Internet Corporation for Assigned Names and Numbers, ICANN. In the main hall there were business and government leaders from around the region. At one of the side events an innovative new registry, dot asia, was launched.
Everything about the event spoke of economic dynamism and to me, of the benefit of an economic system – and longer term economic growth – built on a strong foundation of Intellectual Property (IP) rights. But most entrepreneurs in South Asia and other Emerging Markets (EMs) are still not fundamentally interested in the IP debate. They do see themselves as authors, or artists, or techies, but they don’t see themselves as IP entrepreneurs.
Personally I think this is a tremendous missed opportunity, with long-term implications for economic development.
The rolled eyes phenomenon
Of course if you get into a discussion of IP protection, many people will roll their eyes. Issues of IP are seen in the negative, largely defined by our nearly universal dislike – and this seems to be a global phenomenon – of lawyers. Add to this the general skepticism about the functioning of the courts in South Asia – and most people back away from IP.
However, to my eyes the IP protection debate is not about lawyers at all, but about the very entrepreneurs on whom so much hope is placed. I take as an almost frivolous example the case of the brothers from Calcutta that produced Scrabulous…
The Calcutta brothers who made Scrabulous
Now in the interest of full disclosure, I am a big Scrabble fan. I love playing. I have the computer game on my PC, and I play a lot. I know enough of the two letter words and obscure words beginning with Q that few of my friends will even play with me any more.
So you’d think that something like Scrabulous would have real appeal for me. But I think they should close down the program, and the sooner the better.
There are a number of reasons, of course, starting most obviously with the idea the brothers are hawking, which isn’t theirs to sell. The fact that Scrabulous is for fun and not for profit is irrelevant. It’s no different than piracy of any sort. If I write a book, it’s mine to sell, or license, or give away as I see fit.
Next, you have to consider the Scrabulous phenomenon and ask yourself – is Scrabulous really creating any real value for India? True, in the short term there might be some work for a few lawyers and a PR firm or two. But a few billable hours do not an economic powerhouse make…
Plain fun vs economic value
Compare Scrabulous with the original board game. Scrabble (the idea, using IP protection) has provided value for 50 years. The developers licensed the name to Hasbro, and again to Mattel. Money made, taxes paid, employment provided—the seeds of economic growth. From there the game spread around the world, long before the existence of the Internet. Again, people were hired in manufacturing and promotion in different countries. The game entered into the world’s consciousness. It was a good idea, made possible in part because of IP protection.
Scrabulous, on the other hand, will likely be gone within the year. Not much economic value there for India or the world.
There are many in Emerging Markets that get caught up in arguments around the high cost of IP. And its true, some IP – whether music, or film, or software, or whatever – can be costly. However, if we are really focused on building long-term opportunity in Emerging Markets, a short-term focus on the cost of IP misses the point.
I often hear that Bill Gates or Madonna (or in the case of Scrabulous, Hasbro) won’t miss a few rupees if their IP is pirated. Maybe so. However, there is something much larger at stake. Emerging Markets entrepreneurs and government officials talk frequently about their desire to promote investment and growth and protect their own IP and CP (cultural property). They decry the lack of available finance for growth, and complain that they don’t get the best and latest goods and products.
From value to development
South Asia, as well as other Emerging Markets, can’t seek to create an environment that will promote rapid, information-based, high-skill economic growth while tolerating loose IP standards. Experience shows that you simply can’t have it both ways.
Why? They simply won’t attract as much investment in the long term. They won’t have the same ability to retain good talent. They won’t be able to build wealth. They won’t build competitiveness. And they won’t be able to and create alliances with companies that can give them access to global markets.
So, Emerging Markets need to recognize the role that IP protection can play in economic development, from creating employment, to strengthening the middle class, to ensuring economic independence and cultural preservation.
Requisite for the next IP entrepreneur
South Asians need to demand the kind of business environment that will help them thrive, and the improvements to the courts that will help them protect and leverage their country’s good ideas. In the words of Sourabh Gupta, a Washington, DC-based Indian trade and development analyst, they need to build “a body of case law that is pro-innovation and pro-IP protection to help underpin their aspirations of upward mobility.”
It’s not about today’s Bill Gates. It’s about tomorrow’s Bill Gates, the one who might come from India or Bangladesh or any other Emerging Market.
And as Gupta says, the opportunity “will only be as strong as the energies invested by those most materially affected – the vast multitude of small entrepreneurs.”
In the end, if we are truly serious about what we claim to want so badly – investment, jobs, to be taken seriously on the world economic stage, to become economic drivers, not just followers – then we need IP protection.
Because unlike Scrabble, economic development is no game.