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The Intellectual Property (IP) and patent landscape are incredibly complex. There are rules and regulations for different types of products, designs, and trade secrets differing by country and region. It takes years to develop unique products and bring solutions to market to consumers, with a tremendous amount of IP involved. This is why it’s crucial for everyone — especially for smaller companies — to have the resources in place to protect their property and in some cases even their livelihood.
Intellectual property and patents are some of a company’s most important assets in today’s business climate. But these assets could be under threat from competitors, hackers, and other bad actors. For the tech giants that have an army of litigators and resources at their disposal, fighting patent infringement or IP infringement lawsuits is par for the course, but smaller companies often don’t have the luxury to go through a multi-year court battle.
In the retail industry especially, we’ve seen an uptick in patent infringement lawsuits in the last few years. Shell companies often referred to as non-practicing entities (NPE) buy flimsy patents and then sue retailers for patent infringement. And while these patent trolls lose more than 90% of their court cases, according to the National Retail Federation, the cost of the court battle is high. NRF estimates that annually these court battles cost legitimate businesses $30 billion in direct costs and $80 billion in indirect costs.
The case can be made for stronger patent protections through government intervention, but knowing how slow our government typically moves, such a process would take years if it even makes headway at all. This has paved the way for technology to help. In the last few years, Amazon has actively turned to technology like AI, ML, and automation to help fight the battle against IP theft with a focus on its massive seller network.
Recently, the e-commerce giant recently released its second Brand Protection Report, detailing the progress the company has made to protect customers, brands, selling partners, and the Amazon store from counterfeit, fraud, and other forms of abuse. Amazon is dedicated to building and providing tools to its partner network that can be used to improve protection and hold bad actors accountable.
Using Technology for Good: Amazon Brand Protection Report
Amazon has hundreds of thousands of brands as part of its seller network. The company has stepped up in recent years to ensure these brands are protected and not just on Amazon’s website — anywhere that their products are sold. Amazon is leveraging different technologies to protect these brands. Uses for technology for good include:
- Machine learning for proactive controls. Amazon is leveraging machine learning models to mine data from various seller accounts and product listings for potential risks including relations to previously identified bad actors. Identifying the infringement or possible infringement is a big step for these small companies. Many often don’t have the resources to constantly be looking for infringements from threat actors and NPEs that could file a lawsuit.
- Automated tools to fight infringement. Amazon’s Brand Registry has over 700,000 brands actively enrolled. Within Brand Registry, the company launched the ‘Report a Violation’ tool, making it easier for brands to request evaluations over potential patent disputes. Outside counsel is then connected with the brand to make recommendations on whether or not patent infringement occurred and what to do next. SMBs don’t often have an army of lawyers ready to help out. But tools like this can make the fight easier regardless of size.
- Can’t Protect Products without IP Rights. A company can’t fight for protection unless it has IP rights and patents in place. Amazon’s IP Accelerator tool through Brand Registry helps businesses obtain IP rights faster and more efficiently, protecting their products everywhere. Imagine if we had a system to help companies, regardless of size, apply for patents and IP protections easily? How would this impact NPE lawsuits? Would we eliminate the patent trolls? There could be positive benefits for smaller retailers.
IP Protections and the Implications on Patent Trolls
In the last few years, policymakers everywhere have been looking to create laws and regulations to stem the rising power of Big Tech. But I believe they’ve failed to protect the smaller companies from these patent trolls that can hurt their businesses dramatically with flimsy lawsuits. Smaller businesses that do not have the resources to fight multi-year court battles are at an inherent disadvantage. The way the system is built, those with money win out, almost always, unless a regulator steps in.
Technology used for good, in this case, making it easier to find and fight IP infringement, could go a long way to protect our retailers and in turn protect consumers. NRF also estimates that the costs associated with these NPE lawsuits can trickle down to consumers. We need more technologies like what Amazon has created, to protect our retailers.
While oft-criticized for its size, scale, and perhaps the things it can do better, I like the effort that is being put forward by Amazon here. The company could’ve easily put minimal controls in place or not offered any meaningful protection at all. Given that Amazon generates most of its revenue on sales so who would care what product is being sold. Furthermore, the company could have opted only to protect products that are sold on its website. It’s not Amazon’s responsibility to protect brands everywhere. But the company is stepping up, using technology for this important cause and thereby protecting large swaths of the retail industry from harmful threat actors.
.With intellectual property being a crime that is often under-prosecuted and perceived as victimless, in reality it has massive costs and leaves a trail of victims. The fight against it requires vigilance and now more than ever, technology. Amazon, with its significant resources, and global presence, is providing a path toward curbing this troubling issue for many retailers—something that benefits sellers and buyers everywhere.
Now, we should hope for more companies step up with resources and technology to fight to protect IP rights and make shopping online a safer and more pleasant experience for all.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum Research as a whole.
The original version of this article was first published on Forbes.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. Read Full Bio