When I tell this story in class, I talk about how software can’t be patented, and how copyright really doesn’t do much to protect the Intellectual Property of software developers either. When I ask my students what computer firms can do to profit from innovation in this situation, they inevitably come up with a wide range of ideas.

If I just open without the GUI story and ask people how you can profit from your innovations, the first answer is always “patents”, followed by “copyright”, followed by a long silence.

The idea that legal IP is the only way to profit from innovation is pretty deeply embedded, but it’s untrue.

This excellent TED talk by Johanna Blakley uses the example of the fashion industry to show how it is possible to profit from innovation even if you don’t use legal IP protection:

So fashion does just fine without IP protection. Some of Blakley’s key points are:

• In fashion, the ability to copy leads to increased innovation due to widespread copying, which leads to many new and novel combinations of ideas. Connecting ideas is the fundamental creative act in innovation – so it makes sense that working in an IP regime that makes it easier to connect ideas will create more novel connections.
• Even if something looks like an exact copy, there are substantial differences between knock-offs and originals. Furthermore, people can tell the difference. Once in Beijing I bought a pair of xRay-Ban sunglasses, just for fun. They fell apart in less than four months. So I went back to a pretty nice pair of sunglasses that cost about 7 times as much. I’ve had them for 17 years and counting, and they’re still in great shape. High quality ends up being a pretty good method for profiting from your innovations.
• Another way to profit from your innovation is to make things that are too complex to be easily copied. That’s what Charlie Parker was trying to do with bebop. Complex design and complex value creation networks are two very good methods for protecting yourself from copiers.

You can see all of the slides from Blakley’s talk here (and there is more information about her research at ReadyToShare.org) – here is one of the key pictures (grabbed from the talk by Simon Bostock):

This makes the point that industries with low levels of legal IP protection are actually pretty important within the economy. Massively important. The chart is a bit misleading in that there are a few high IP industries that are also pretty big, like pharmaceuticals, which aren’t included. But the main point holds – you don’t need to have legal IP protection to profit from innovation.

There are many ways to win with your great ideas. Being innovative in the business model that you build to support your innovation is one of the best ways to do this. Business models are another thing that aren’t subject to copyright protection. Don’t get hung up on patents and copyright. There are other ways to win with innovations, and many of them are actually more effective. We need to be as creative in making our business models as we are in coming up with new products, new services and new ways of doing things.