Date post: | 12-Sep-2014 |
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Ian P. McCarthy
THE VELOCITY OF CREATIVE CONSUMER ACTIVITY, PRODUCER STANCES AND THE INTELLECTUAL PROPERTY LANDSCAPE
INTRODUCTION
• Why do we need to rethink strategies when the consumer creates the value?
– The innovation landscape has changed
• Who should do the rethinking?
– Creative consumers?
– Policy makers/legislators?
– Firms/producers?
• Draws upon and adds to work by McCarthy et al (2010), Berthon et al (2007), Fisher (2014), Fauchart & Hippel (2008) and Strandburg (2008)
• I am not a law scholar or a law professional.
• Legal and innovation context is US centric
INDUSTRY DYNAMICS: VELOCITY
• Speed is central to industry change (dynamism) and performance.
• High velocity industries (environments):
– “those in which there is a rapid and discontinuous change in demand, competitors, technology and/or regulation” (Bourgeois and Eisenhardt 1988: 816)
– “market boundaries are blurred, successful business models are unclear, and market players (i.e. buyers, suppliers, competitors, complementers) are ambiguous and shifting”. (Eisenhardt and Martin 2000: 1111)
• Velocity is the rate (speed) and direction of change
PRODUCT VELOCITY
4
2005 2010
Continuous and 6 new models
Discontinuous
From: McCarthy I. P., Lawrence T. B., Wixted B., & Gordon B. R. 2010. A multidimensional conceptualization of environmental velocity. Academy of Management Review, 35(4): 604-626
REGULATORY VELOCITY
5
Discontinuous:Restricted to 21 lines
From: McCarthy I. P., Lawrence T. B., Wixted B., & Gordon B. R. 2010. A multidimensional conceptualization of environmental velocity. Academy of Management Review, 35(4): 604-626
August 9, 2001
Discontinuous:Increased to over 1000 lines
Mar 9, 2009
6
Direction of Change
Discontinuous
Continuous
Rate of ChangeLow High
The velocity of:
(i) creative consumer activity,
(ii) producer stances
(iii) intellectual property landscape
VELOCITY FRAMEWORK
USER INNOVATION AND CREATIVE CONSUMERS
• User innovators are “individuals or firms that create novel things to use, rather than wait for manufacturers to identify, create, and deliver these things to satisfy the need or desired use” (Hippel, 2007).
• I am focused on:
– Individuals, not firms.
– individuals who modify existing products, as opposed to those who design completely new products
• These individuals are called ‘creative consumers’ (Berthon et al 2007)
CREATIVE CONSUMER ACTIVITY (CCA)
Rate of change = highDirection of change = continuous
Torrance & von Hippel 2013
PRODUCER RESPONSES (PR) Berthon et al 2007
11
Firms attitude to CC innovation
Producer action to CC innovation
Passive
-ve
Active
+ve
RESISTActively restrain the innovation e.g., block all, integration
ENCOURAGEHappy to allow but don’t help the innovation
DISCOURAGEDefacto ignore or tolerate the innovation e.g., acquiesce
ENABLEActively facilitate the innovation
Berthon P. R., Pitt, L. F., McCarthy I. P., & Kates S. M. 2007. When Customers Get Clever: Managerial Approaches to Dealing with Creative Consumers, Business Horizons, 50(1): 39-47
PRODUCER RESPONSES (PR)
Block all by integration
Block all, block some, block none (Fisher 2014)
Block all by restricting
PRODUCER REPONSES (PS)
Block some: do no harm
Block none: acquiesce
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PRODUCER REPONSES (PS)
Block none: appropriateBlock none: competitions and tool kits
Rate of change = highDirection of change = discontinuous
THE LEGAL LANDSCAPE
• Producers– Copyright, patent protection and trademarks.– Digital Millennium Copyright Act (DMCA)– Forces: compensation, labour-desert theory and personality
theory (Strandburg 2008)
• Creative consumers– Fair use doctrine– First Amendment for freedom of expression– Forces: market failures, distributive justice, human flourishing
(Strandburg 2008)– Norms-based IP systems (Fauchart and von Hippel 2008)
Rate of change = lowDirection of change = continuous
VELOCITY REGIME
Creative consumer
activity
Legal landscape
Stances of producers
Rate of change
Dire
ction
of c
hang
e
Low High
Conti
nuou
sDi
scon
tinuo
us
A conflicted velocity regime:
“diverse, coupled and contradictory velocities” McCarthy et al (2010)
Norms-based IP systems
CONCLUSIONS
• Conflicted velocity regimes present costs to society:
– Misfit costs
– Costs of delays and missed opportunities
• IP Response should consider different innovation contexts: cultural innovations vs. artifact innovations; medical innovations
• Norms based IP systems.
• A lot of creative consumer activity is hidden and more protected than is assumed.