Many businesses in today’s increasingly connected marketplace find ways to relate and bridge together in various capacities. In our increasingly digital workforce, many companies are forming concepts and business models around existing goods and services, and many startup ventures are procuring creative digital services around established businesses and products already out there. In these cases, start-ups are finding new, creative ways to engage and conveniently service consumers with various different forms of media and entertainment, from music outlets and television productions, to education resources online storage platforms. However it should be noted, that a startup’s worst hindrance, and in many cases, fatal mistake is facing copyright infringement complications.
Copyright infringement can stop even the most popular and successful startups dead in their tracks, if intellectual property of another owner is found to be stolen, even if it is inadvertently. Without fully understanding the ins and outs of intellectual property rights, many startups have met their demise, so careful consideration of these rights in establishing a new and unique business model is critical. A few of the most recognizable startups that have fallen victim to copyright infringement accusations include Napster, ReDigi, Boundless Learning, Aereo, and MP3.com.
Napster rose to prominence before digital music retail outlets had fully cemented themselves in the music industry, and thus Napster created a massive peer to peer music sharing network, allowing users to freely download previously copyrighted music. Record labels had not given Napster any prior consent or permission to do so, and Napster was met with a slew of infringement cases and eventually lead to the company’s bankruptcy. Napster’s business model was largely based on the pretense of copyright infringement anyway, similar to Boundless Learning’s effort to redistribute college textbook materials for online viewing for free. Whereas Boundless Learning was able to come to an undisclosed settlement with the publishing companies that filed the infringement, Napster and MP3.com could not continue to operate. In contrast however, Aereo’s case was a little more complicated and a little less black and white.
Aereo provided its users with leased antennae that used a unique technology to pick up live television broadcasts for instant viewing, or record programs for later viewing. Although Aereo provided their own technology and hardware, many broadcast network companies argued that Aereo’s services were too similar to that of a cable television provider, and eventually a court ruling round Aereo to be illegally redistributing the property of the broadcasters. Aereo’s business model was not designed around these intellectually properties correctly, and ultimately lead to the venture’s failure.
Without the proper consideration of specific terms and laws regarding to intellectual property, many startups face serious hurdles with copyright infringement protections. Anyone considering a startup that is tailored to exisiting goods, services or trades must first pay careful attention to exactly how the business is structures, in order to avoid potentially fatal mistakes.
Via: YourStory