IP Overview

Introduction

Intellectual property, whether we realize it or not, affects us all during virtually every day of our lives. If you have any doubt about this, consider whether you have done any of the following things within the last 24 hours?

Listened to the radio or a CD?
Watched TV or a movie?
Read a book, newspaper or magazine?
Used software on your computer?
Accessed a website on the Internet (as you are obviously doing right now)

What Is intellectual Property?

Intellectual property includes several different areas of law (e.g., copyrights, trademarks, patents, and trade secrets) which protect creations of the mind as opposed to physical products. In other words, intellectual property involves property which has no physical existence. In many respects, intellectual property is similar to physical property. For instance, it can be bought, sold and stolen ("infringed" in copyright lingo).

Types Of Intellectual Property

The main types of intellectual property are:

Copyrights
Patents
Trademarks
Trade Secrets

What Is A Copyright?

Copyright law protects creative works of authorship. Many different types of works can be protected by copyright such as:

Books and other written works (poems, magazine articles, etc.)
Songs and sound recordings
Movies & other audiovisual works
Paintings, drawings and other forms of visual art
Computer programs

What Is A Trademark?

A trademark is something which identifies goods or services and distinguishes them from others. Trademarks are commonly made up of words, names, symbols, and pictures.

What Is A Patent?

Patent law primarily protects inventions & discoveries.

What Is A Trade Secret?

Trade secret law protects certain valuable business information which is (as the name implies) kept secret.

Why Do We Need Intellectual Property?

There are several reasons why the law allows for the ownership of intellectual property, but probably the most basic reason is that products resulting from human intellect can be valuable and the creators of these products should be able to benefit from their creations. However, intellectual property is not only intended to benefit creators, but also to benefit the public. The public is benefited by having access to creative works (although not always free access) which results in the advancement of knowledge and expression. Intellectual property provides people with financial incentives to create. Without any possibility of being able to make money from their creations, people and companies would be much less willing to invest their time and money in creating new works. This doesn’t mean that people would stop creating altogether if intellectual property didn’t exist, but certainly far fewer works would be created. For example, would authors write books if there was no possibility of selling them and earning royalties? Similarly, would songwriters write songs?

It is also important to consider whether companies that sell creative works would invest money in their creation without the protection provided by intellectual property? Consider just a few examples:

Drug manufacturers invest millions in research and testing in order to bring new prescription drugs to the market. These drugs are protected by patent law, which allows the drug manufacturer (as patent owner) to have the sole right to sell the patented drug for a period of time. Once the patent expires, anyone is free to make and sell the drug which results in generic brand drugs.
Major record companies generally spend in excess of $500,000 to produce and market a new CD. The sound recordings and songs contained on a CD are protected by copyright law. If you think being a big record company is expensive, you're right, but at least its not as bad as being a major movie studio which spends over $50 million to make and market a feature motion picture (also protected by copyright).
Companies such as Nike and Coca-Cola spend millions of dollars a year advertising their products under brand names. These brand names as well as the names of the companies themselves are protected by trademark law.

As you can see, making and selling creative works can be quite costly. Without intellectual property law, fewer works would be created and made available to the public. As a result expression, innovation and the advancement of knowledge would be hindered.

Conclusion

In a nutshell, intellectual property is important to creators since it allows them to own and profit from their creations. However, it also benefits the public by ensuring that more creative works and products will be created and made available for use by the public. In fact, intellectual property has become increasingly importance over the past several decades as we have to a large extent evolved from an industrial to a "information society." Many modern businesses most important assets are their intellectual property rather than the physical products they produce. Consider that:

Coca-Cola’s various trademarks have been valued at $24 billion.
The richest individual in the world (according to Forbes Magazine) is Bill Gates. Bill is so well off due to copyright ownership, since the software sold (or more accurately licensed) by his company Microsoft is protected by copyright.