Reinforcing the IP-sharing theme discussed here on July 1, Dan Tapscott, in a forward looking blog in the WSJ, offers new paradigms for five industries that are currently busy chasing their tails. The common thread in each suggestion is collaboration of some sort, a sharing of intellectual property.
For example, in a pharmaceutical industry that once relied upon biotech for the early heavy lifting, Tapscott says the solution to the revenue shortfalls resulting from drugs coming off patent does not rest with individual companies, but rather with the industry. He suggests sharing drug trial information. (A recent AP-sourced article discussed the current state of affairs in pharmaceuticals: “Patent expirations will sweep over the pharmaceutical industry in the next few years. Competitors like Pfizer Inc., and Merck & Co. have made major acquisitions or trimmed research and development expenses to deal with the impending revenue loss…[and alone in following a ‘stick-to-the-knitting strategy,’] Lilly's pipeline remains incapable of replacing patent-related losses.”
In music, Tapscott thinks Spotify (soon to be available in the U.S.), Google and Amazon are blazing the only trail that will ultimately lift the industry: cloud technology. All performers would put their IP into the cloud common area; subscribers would stream what they like, when they want; performers would get paid based on popularity; and related copyright infringement would vanish. (There is a missing party here: how do the music companies get paid? Perhaps the new technology will redefine a music company, as it did with Apple’s iPod. Valuators need to look closely at this change.) (According to the Wall Street Journal, Netflix appears to feel the same future awaits home movie rentals.)
Also in financial services, manufacturing and healthcare, Tapscott believes collaboration will be at the heart of the new business models.