established business vs. innovation

Jeff Bone
Wed, 09 Jan 2002 15:03:35 -0600

Russell Turpin wrote:

> I can't help but notice, of these two examples, current
> corporate opacity proved completely INeffective at
> preventing COPY.

You're right, but you're highlighting the common misperception:  opacity isn't
designed to *prevent* COPYing, it's designed to make it expensive enough to
provide a balanced MAKE vs. BUY decision environment and therefore preserve the
process by which innovation is turned into ROI for the innovator's investors.

> In the first case, this was prevented
> by IP, and in the second case, it wasn't prevented. It
> seems to me the relevant thorny examples would be ones
> where COPY failed because of trade secrets, e.g., the
> Coca Cola formula.

Well, COPY failed in the case of Cisco / NetSpeed;  it wasn't "perverted" by IP,
rather the risk involved (legal, etc.) made the COPY strategy impractically
expensive, forcing a BUY decision.