This study by the Sectoral e-Business Watch is expected for June 2008.
Intellectual property — including copyrights, patents, trademarks and trade secrets — is widely recognised as a key driver of innovation in the ICT arena. Adequately protecting and promoting IP is thus fundamental to Europe’s future ICT competitiveness. On the other hand, IP regulation is at the heart of some of the most heated competitive battles in the industry, concerning software production (including the rising of open source software and the question of the patentability of software) and concerning digital rights management for media content. In this context there is a conflict between defenders of IP protection and stakeholders who believe that excessive regulation in this field may even result in obstructing innovation, rather than encouraging it. This means that IP protection is an extremely sensitive issue, where policy makers have a considerable power to influence the development of the market and the competitive game.
This is particularly relevant for ICT SMEs. According to previous work by e-Business Watch on the topic, "IP protection, in particular patent protection is critical to the success of many technology-driven SMEs as it enables them to attract investment capital and to access finance. In addition, small innovative firms are far more dependent than large firms on the income derived from technology licenses to fuel ongoing innovative work. Used effectively, IP protection can also improve SME competitiveness against their larger rivals. It is thus no coincidence that studies in Europe have consistently demonstrated the increasing reliance of SMEs on patent protection. A most recent study by the EU Commission confirms that many start-ups adopt business models that use patents as core assets. Often a patent is the key element around which a start-up organises its entire business. Other IPR tools like trademarks help SMEs to build corporate identity through branding. Furthermore, an environment characterized by strong intellectual property rights, seems to influence in a positive manner the creation of new companies".
According to an ongoing study being carried out by IDC for DG Information Society on innovative ICT SMEs in the EU, insufficient IP protection is one of the barriers preventing SMEs from participating to cooperative research programmes, where they may be requested to share their knowledge with larger competitors. This fact points to a potential critical role of IP policies within research funding programmes addressed to SMEs. However, the above-mentioned study does not investigate specifically the issue of IP management influence on SMEs behaviour; its main goal is to provide an overview and inventory of the innovative SMEs in the ICT sector in the 25 Member States.
In contrast, the study by the SeBW will provide a much more detailed view of the issue of IP protection within SMEs research and innovation strategies as well as their business strategies.
Concerning the role of IP policies, it is important noticing that few managers of European SMEs have familiarity with IPRs. Many undervalue the usefulness of IP protection for their own business goals in the emerging knowledge economy, within the new global competitiveness scenery. There is a clear responsibility here for policy makers to arrange help and advice, but always in the context of SMEs business strategies. It is necessary to understand better how SMEs may take advantage of the IPR system to improve their competitiveness, without losing their flexibility and the capability of being quick to market, exploiting niches with new products and processes.
The European Commission is well aware of the relevance of IP protection for ICT SMEs and has frequently carried out discussions with stakeholders about the best way to regulate the matter. However, the sources cited about SMEs concerns often turn out to be based on research funded from an advocacy or lobby group and, as a result, lack credibility. There appears to be a gap in the evidence-base of the views of ICT-producing SMEs on current trademark, registered design, patent, copyright systems, contractual tools or informal arrangements methods of IP protection. There is plenty of qualitative evidence and reflections about the critical issues, but there is a lack of specific, solid and coherent quantitative data. An analysis based on new and empirical data, as done via an extensive survey over European ICT SMEs, could help to fill this gap.
Therefore a Topic Report on Intellectual Property Protection for European ICT producing SMEs, focused on a survey and interviews of SMEs by an independent third party such as the eBusiness Watch consortium can provide considerable value added. Moreover, this report can build on previous qualitative work carried out by e-Business Watch, focusing on the new emerging issues which are affecting SMEs business strategies and providing input for policy-making in this area.
The study will address the universe of ICT-producing SMEs, including ICT manufacturing and services SMEs, excluding purely commercial-oriented enterprises. The main issues to be investigated will be:
The study will include the main ICT manufacturing, software and services industries according to the NACE classification (see following table). The study will exclude the insulated wire and cable (NACE Rev. 1.1 31.3) industry and the database activities sector (72.4) which seem rather mixed and out of the scope.
Industries covered by the Topic Report Survey
| NACE Rev. 2 |
NACE Rev. 1.1 (Proxy) |
Business activity: |
| Manufacturing activities | ||
| 32.1 | 26.1 | Manufacture of electronic components |
| 30.01 + 30.02 | 26.2 | Manufacture of computers and peripheral equipment |
| 32.2 | 26.3 | Manufacture of communication equipment |
| 32.3 | 26.4 | Manufacture of consumer electronics |
| 33.2 | 26.51 | Manufacturing of instruments and appliances for measuring, checking, testing … |
| 33.2 | 26.7 | Manufacture of optical instruments and equipment |
| 33.3 | 26.52 | Manufacture of Industrial process control equipment |
| Information technology services | ||
| 64.2 | 61 | Telecommunications |
| 72.1, 72.2, 72.3 | 62 | Information Technology Service activities |
| 72.2 | 58.2 | Software publishing |
| 72.3 | 63 | Information service activities |
The study will be based on the following empirical data:
