Industries Using Government to Undermine Innovation and New Competition

The pending Stop Online Piracy Act (SOPA) legislation provides the opportunity to clearly delineate old industry from new - established markets from emerging market forces.

Old Industry is seeking policy to protect their media distribution models. New industry is seeking the continued openness that is currently driving innovation, creating new markets, one could even argue, driving revolutions both figurative and literal. Below you can see who is driving the new regulation and see who is opposing it.

What is SOPA? http://en.wikipedia.org/wiki/Stop_Online_Piracy_Act The Stop Online Piracy Act (SOPA), also known as H.R.3261, is a bill that was introduced in the United States House of Representatives on October 26, 2011, by Representative Lamar Smith (R-TX)

 http://maplight.org/content/72896 - data source

Industry Business Interest Contributions
    (Jan. 1, 2009 - Jun. 30, 2011)
     
Computers/Internet (Opposes) Computer software $273,744
  Online computer services $251,233
Total
  $524,977
     
TV/Movies/Music (Supports) Cable & satellite TV production & distribution $672,750
  Commercial TV & radio stations $265,050
  Entertainment Industry/Broadcast & Motion Pictures $320,800
  Motion Picture production & distribution $282,150
  Recorded Music & music production $317,446
  TV production & distribution $125,400
Total
  $1,983,596
     
Grand Total   $2,508,573

 

It's the new American way of doing business in the post-modern digital swish:

Write new rules and litigate.

As disruptive innovation in an industry emerges, old business, people who have profited from predictable market conditions over time, are tempted to pay lobbyists and buy legislators to create policy that undermines competition, ultimately protecting their markets and their revenue streams.

Alternatively, businesses have other strategic and tactical options when faced with innovation - competition via: price, value, R&D, partner, buy the competition etc. 

Do nothing and a business faces declining revenue and closing up shop (see: Polaroid, Blockbuster, Borders Books)

Enter disruption to the status quo >>>  Thesis challenged by an Antithesis that results in Synthesis.

Anachronistic crony capitalism is the act of buying government policy and policy makers to avoid competition, to externalize costs, and to make revenue streams as permanent as possible. Established companies need to become good at sustained investment and innovation learning how to strategically invest and drive a sustaining innovation path.

This is key. Your profits are not guaranteed into perpetuity. You cannot use government to enforce market conditions that guarantee your competitive edge.

I am a promoter of open source and open standards and peer review. Be that as it may, it is worth noting, that even Microsoft continuously includes strategic R&D investments in their business model in order to drive sustainable future revenue.

Corporations should not be allowed to buy policy, buy market conditions, write laws and effectively influence and deviate markets for their benefit.

Compete.  Damn it.