In recent years, the world has witnessed several milestone
events signaling the arrival of a new generation of global internet
companies. Apart from the much-hyped dawn of social media, there is
a much broader trend taking place, one that has outgrown the
traditional boundaries of the tech sector itself. "In
short," as Marc Andreessen wrote in a recent Wall Street
column, "software is eating the world." As
corresponding developments are happening in China, this new era has
caused and will continue to cause dramatic implications on the
monitoring and enforcement of intellectual property rights in the
In the United States, consider the examples that Andreessen
cites in his article. With the fall of Borders earlier this year,
Amazon is now the largest bookseller in the US; but through the
power of software, Amazon is beginning to emerge as a threat to the
traditional retail industry. The most dominant and rapidly growing
distributors of music, movies, and television programming are
companies like Netflix and Apple (through its iTunes service), both
of which sell and stream their content entirely online. The
world's fastest growing telecom company is Skype (purchased
by Microsoft earlier this year). The fastest-growing recruiting
company? The newly-listed LinkedIn. Even the multi-billion dollar
gaming industry is being taken over by online gaming providers such
as Zynga and leaving behind traditional hardware manufacturers such
as Sony and Nintendo.
Parallel developments are also taking place in China, where the
social, political, and regulatory landscape have made the domestic
internet sector notoriously difficult to penetrate for foreign
players. Fast-growing consumer e-commerce websites such as
Alibaba's Taobao and 360buy.com are squeezing the market
share of traditional brick and mortar retail businesses. Online
video providers such as Youku.com and Tudou are beginning to
partner with media production companies such as Time Warner and
Disney to provide paid video-on-demand services.
As the retail industry begins to migrate online and the
prospects of e-commerce have become more lucrative for small
businesses, the online sales of counterfeit goods have also spiked
in recent years. Likewise, the more primitive methods of copying
DVDs or sharing media through the web are now giving way to
streaming media websites that often contain copyrighted movies or
television programming. The result is that the battle between
intellectual property infringers and enforcement efforts to contain
them is increasingly taking place online and within the bounds of
software platforms operated by third parties such as Taobao and
Rather than employing litigation tactics or notifying the
authorities, shutting down a retail operation for counterfeit goods
now often involves notifying consumer-to-consumer or
business-to-consumer software platforms of the infringing
activities. Similarly, rather than seeking to destroy countless DVD
copies of copyrighted content, removing infringing media from mass
distribution involves corresponding with online video-sharing
platforms. In both cases above, the platform provider risks
exposure to secondary liability if it is notified of infringing
content and fails to make sufficient efforts to remove such content
Thus, as infringement activities become consolidated onto online
software platforms, whether these activities be the sale of
counterfeit goods on an e-commerce site or the distribution of a
copyrighted content on an online video site, the methods of
monitoring and controlling intellectual property infringement are
The traditional view of the IT sector is that the internet has
transformed the way we obtain, process, and communicate
information, whether that information is in the form of a study in
an academic journal or the latest status update from a friend on
Facebook or Renren. However, in this new world of
software-dominated companies, the internet is not only a means of
manipulating information, but a means of providing consumer goods,
entertainment, and services (the list goes on). How this will
continue to shape the future of intellectual property enforcement
in China remains to be seen.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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