“If you can’t innovate, litigate.” Are entrepreneurs being prevented from innovating?

Innovation. Given the frequency in which the word is bandied about by companies and entrepreneurs, you’d be forgiven for thinking there was a global consensus that we are currently living in an age of unprecedented innovation...

“Somewhere between dire straits and dead.” That’s how PayPal founder Peter Thiel recently decided to sum up the state of innovation in America, but how can that be? Every week it seems as though a new start-up, offering some sort of revolutionary service, is sold for millions. It would be almost impossible to argue that Twitter, Facebook and Instagram have not changed the way we work, communicate and operate on a daily basis.

However the long-term economic impact of these modern day innovations is something that’s most certainly up for debate. How many inventions in your lifetime will have the same impact on mankind in 200 years’ time as the light bulb, toilet or car?

Astronaut John Grunsfeld gets something in his eye, as the camera captures the reflection of fellow Astronaut Andrew Feuste

The speed and breadth of new innovations that the 19th and 20th centuries witnessed was quite staggering when compared to any other period in time. And yet it’s possibly the greatest invention of most of our lifetimes, the internet, which now poses a real threat to true, continued innovation. The world has been presented with a free, accessible and generally easy to use platform with which to create new things. Never before has it been so easy to start your own business or tackle a problem, but the viewfinder problem-solvers are now gazing through has been altered significantly. To be precise, it’s now tablet-shaped.

The world seems to want us to walk around with our head faced down looking at a smartphone. The actions of bankers that led to the global financial crisis have ensured that risk is now a dirty word in the eyes of many corporations and governments; crucially, doing things at a great cost is very risky business. Putting the first man on the moon is risky, keeping Concorde in service is risky, exploring oceans is risky. Using the internet to create a new app can be both incredibly cheap and profitable. You can see why so many are keen to play it safe.

When start-ups do manage to make their way past the litigation and the dirty tricks campaigns, obstacles are often put in the way in the form of government regulations.

Meanwhile, the next generation of entrepreneurs require a steady nerve not to be dazzled by the Silicon Valley cult of tech entrepreneurship. Why would you want to go and get your hands dirty in a laboratory or a workshop creating something when you can make billions through a digital innovation that can be tried and tested without leaving your front room? It’s a financially rewarding and increasingly cool culture that young people want to be a part of. By the time politicians have bundled their way onto the bandwagon to launch travel tech incubators in their city, you know this is no longer a niche interest but a certified worldwide trend.

When products or services that can be classified as genuinely game-changing are actually put onto the market, especially in sectors which are monopolies or duopolies, entrepreneurs should be braced for the worst, as more established companies attempt to fend off disruption in their industries. "They will throw everything under the sun at you, and a lot of it is not cool," explained Nest Labs CEO Tony Fadell. “In addition to patent lawsuits, they'll trash your products on review sites. They really don’t like us, they don’t want some little upstart coming in and disturbing the same thing they’ve been doing for 40 years and never were challenged. They cannot innovate so they litigate! If you can’t innovate, litigate.”

When start-ups do manage to make their way past the litigation and the dirty tricks campaigns, obstacles are often put in the way in the form of regulations from governments and regional authorities: just ask Tesla’s Elon Musk, whose electric car company is currently taking a battering in states across America. Two days ago a ban was imposed in New Jersey that put a block on Tesla’s direct-to-consumer sales model.

“Under pressure from the New Jersey auto dealer lobby to protect its monopoly, the New Jersey Motor Vehicle Commission, composed of political appointees of the Governor, ended your right to purchase vehicles at a manufacturer store within the state,” raged Musk in an open letter to the people of New Jersey. 

“The rationale given for the regulation change that requires auto companies to sell through dealers is that it ensures “consumer protection”. If you believe this, Gov. Christie has a bridge closure he wants to sell you! Unless they are referring to the mafia version of “protection”, this is obviously untrue.”

While there are unquestionably a constant set of restraints placed on innovation, there are some frontrunners that are carrying the baton for disruption of the status quo. In his recent conversation at TED 2014 Google’s Larry Page talked about the company’s desire to “organise the world’s information, making it accessible and usable to everyone”. This, clearly, demonstrates ambition in the extreme, as Google pushes forward on plans to roll out self-driving cars, genuine global internet access and unprecedented developments in artificial intelligence through the acquisition of companies such as the London based DeepMind. The latter of which has interestingly led to a move into self-regulation on Google’s part. They have set up of an ethics board to lay down a set of ground rules to ensure that artificial intelligence innovations cannot be abused by anybody at the company.

There’s no question that the idea of entrepreneurship has changed significantly over the past few decades and with it the way innovation and invention are allowed to take place, but have these recent developments put a block on innovation in its truest sense?

Do you think entrepreneurs have lost the will to innovate? Let us know your thoughts… 


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