Starwire: Uber for Movies, Music, and Patents
[Disclaimer: I’m not officially with the project] Intellectual Property rights in the US are 100% centralized: the US Patent and Trademark Office (“USPTO”) grants all patents and trademarks. Patents, trademarks, and copyrights are collectively known as Intellectual Property (“IP”). Anyone seeking IP rights in the US must first apply with the USPTO, and follow highly esoteric legal rules to get their mark or patent granted.
In practice, this requires the inventor or trademark-owner to hire an IP lawyer at upwards of $500/hour. What this means is that getting a patent or trademark is an investment — often $10,000 or more— and inventors and trademark owners typically seek a return on their investment. Because getting IP rights are expensive, inventors and mark owners often “assign” (sell) their IP rights to companies who pay to acquire the IP from the USPTO, and often conglomerate IP from numerous inventors/mark-owners. Often the inventor is an employee of the company, and is required by contract to assign his rights by the company (this is one of the documents you quickly sign at a new job). The good thing for the employee/inventor, is the the company pays to get the patent, and pays to exert the IP rights when required, which the employee-inventor often could not afford to do.
Exerting IP Rights: Expensive
If getting IP is a Chevy, exerting IP rights is a Ferrari: very expensive (easily $100,00+) Presently, the process of “cashing in” on a patent or trademark is highly centralized, it requires the inventor or mark-owner to file IP litigation in US federal court and show that he/she has the right to the respective novel invention or image. If both sides have IP, a legal fight (“IP litigation”) ensues, often to the tune of $1000+ per hour for the attorneys. If only one side has IP, often the other “naked” party is forced into buying an assignment, just to avoid the high costs of litigation. IP is like traditional property in that it can be bought and sold; inventors are free to sell their patents on ebay if they like. Assignments can be seen as “macro-payments” where the IP is sold outright, like selling a car.
TL;DR: Patents and trademarks are expensive, only the big boys can afford to play
Starwire: Uber for IP
Starwire.io is a new project in the cryptocurrency space using the Elastos protocol that seeks to bypass the USPTO and US courts for acquiring and exerting IP rights.
This idea is not new. Crypto OG’s may remember the Acumen ICO from the 2017 bull run that also sought to decentralize IP using the blockchain. The important point is the Starwire would allow micro-licenses whereby patent, trademarks, and copyrights could be essentially leased or borrowed — like an Uber or an AirBnB. These micropayments could be paid seamlessly by users using the Elastos cryptocurrency without the involvement of the USPTO or US Courts. Just like Uber democratized the prior clunky system of taxis and medallions, Starwire would democratize IP. What this means is that the barrier to entry for authors and inventors would be lowered — it would be easier and cheaper to get a patent or trademark and it would be easier and cheaper to use the patent or trademark. It would also be easier and cheaper for parties seeking to use a patent or trademark to get a short-term license — like a lease to a car — allowing parties to practice the invention and the inventor to profit in a p2p rather than a centralized manner.
TL;DR: Starwire would disrupt the USPTO just like Uber disrupted taxis. It would democratize IP, and allow p2p trading of IP rights.
IP to the masses: the “micro license”
For the consumer, the benefits of AirBnb, Uber, Lyft, GetMyBoat, BoatBound, Netflix and similar gig services is that they can “try out” an asset without buying. I can try out a one-night stay in an Airstream trailer in Texas without buying an Airsteam or moving to to the Friendship State, I can ride in a Tesla without sending Elon a check, I can go tool around the San Francisco bay in a Bayliner boat without ever setting foot in the dreaded Bayliner dealer. I can watch the new Fire in Paradise movie on Netflix without ever buying a copy or visiting Paradise. I can even spend an afternoon with a puppy or kitten without committing to dog or cat-ownership. The consumer benefit is vast.
Similarly, Starwire would allow the common person to take patents, trademarks and copyrights on a test drive. No longer would I have to hire an expensive lawyer and sit before a grumpy (and also expensive, potentially corrupt) judge just to monitize or use an invention, trademark, song or movie. I could simply offer it up to consumers to lease, p2p and buy the rights p2p. If the next Beastie Boys want to sample 100 old tracks to make new music, they could just pay the 100 song owner in Elastos for the right to a short sample, instead of spending the next decade in copyright litigation. If I’m a solar hobbyist that wants to try out a new type of patented solar panels without fear of getting sued, I don’t have to buy a big fat license from a solar company, I could just get a p2p license through Starwire that covers my use and off I go. This is the concept of the “micro-license” and I think it has the power to revolutionize IP. For more, I suggest you watch the video.
TL;DR: Starwire is a cool crypto project, keep your eye on it. Watch the video.
A macro perspective: increasing value
At a macro level, decentralizing IP will make IP rights more valuable just like AirBnB and Uber make houses and cars more valuable, since the house and car is now a profit-making asset not just a possession. The interesting thing is the owner of the house or car or boat doesn’t have to use AirBnB or Uber or GetMyBoat to see the effect in their investment — when they sell the house or car or boat it is more valuable to buyers because of the potential gig use — so the seller can command a higher price. The rising tide raises all ships. The Starwire project has the grand potential to make IP rights more valuable than they were under the clunky old system of bloated IP firms, overworked USPTO examiners, patent “trolls” and crooked Texas courts and judges.
The author is a lawyer, cryptocurrency enthusiast, and frequent Twitter (@CollinsCustomIP) poster on IP topics who resides in California, USA, with his wife, son, and cat. He practices employment law and is not employed in the cryptocurrency space.
Disclaimer: I own Elastos cryptocurrency (less than $100 worth) but am not officially associated with Elastos or the Starwire project in any way, I don’t have any investment in Starwire (yet), and I wan’t paid to write this piece. I am just an Elastos fan (bitcoin level security with a “data is oil” GDPR-ready vision) that came across the project on Twitter in FundMyDapp competition.
