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Hollywood's New Piracy Problem: 3-D Printers by Erich Schwatzel Jul 21, TOPICS: Copyright, Distribution Channels, Legal Environment, Technology SUMMARY: Three-dimensional printers represent a threat to many businesses that thought they immune from competition caused by disruptive technology. 3-D printers represent a threat because companies do not control manufacturing and production. Designers create digital pattens and templates used on printers to make many difierent kinds.of objects. The issues of distribution, piracy and copyright are similar to those experienced in the music and entertainment businesses. The cost to replicate an object using a 3-D printer can be significantly different than the price you pay for auto parts, a coffee cup or a toy in a traditional retail outlet. Companies that manufacture products understand the threat, but aren't sure how to respond or develop strategies that walk the tightrope between control and alienating sers. The issue is becoming more important because patterns and printing are cheaper and mor accessible. The legal environment involves some uncertainty. Is the designer, the person who wrote the code or the individual who operated the printer the target of possible legal challenges? Action against 3-D printing currently follows guidelines from the Digital millennium Copyright Act. Websites that host content infringing copyright have to remove it when the rightful owners notify them. One company, Shapeways. prints 3-D orders for hobbyists and merchants. The company responds to takedown notices and asks users if they are the rightful copyright owner when they uploaded design. Companies manufacturing physical products may not have anticipated competition from 3-D printers, they need to understand the threats and consider strategies to meet the threat. CLASSROOM APPLICATION: As the costs of 3-D printers decline and more users began adopting the technology to print objects ranging from auto parts to toys, companies need to consider how they protect their intellectual property. Distribution channels in many different industries were affected by changes in technology in recent years. The music business was changed significantly when listeners tarted downloading digital music instead of buying CDs. More recently downloads decreased as liste streaming services. The pay-tv industry was also disrupted because cord cutters can find their shows via alternative distribution channels. Manufacturing companies use technology to gain efficiencies in production, but losing control of distribution because of 3-D printing presents a more significant threa Intellectual propertyl distribution channels. There isn't an online outlet like YouTube or iTunes to distribute 3-D designs and files. It is more difficult to trace and confirm infringement with 3-D files as compared to movies and music. Manufacturing companies should prepare business models and strategies to address the changes from 3-D printing technology and copyright often don't protect industries QUESTIONS 1. Do a web search and give a brief explanation of how 3-D printing works,Q2-4 below 2. Think back to our Discussion Forum topic in Week 5 about Disney Movie Studios and their desire to create a franchise of goods and services around the movie Frozen. How could this 3-D printer issue effect this Franchise business model? 3. What are some of the legal issues involved with 3-D printing? 4. Discuss the Shapeways business model and tell us how the company responds to intellectual property and copyright concerns from companies
Explanation / Answer
1. The 3D printing process starts with designing which can easily be done at some ordinary home PC which is connected to a 3D printer. The 3D printer deposits material layer by layer to develop the design in 3D.
2. The ease of use of 3d printers and low cost of replicating the designs (only the digital design file is needed) can enable Disney to easily spread its franchisee business model, where it can share the deigns for its “Frozen” goods with its franchisee partners, who can then use 3D printing to produce the exact same design as much as the demand of the product is. The biggest advantage that Disney would have will be the cost of item, as no mass production and distribution will be needed on Disney’s part and the time to market for the product and will also be low.
3. The biggest legal issues involved with 3D printing are in the areas of intellectual property, data protection and product liability.
3D printing makes copyright breaches and piracy of movies and related products, as replicating any object by a 3D printer is not just easy but also cost effective.
Also, the design files used for 3D printing might use personal data. For instance, hospitals are using 3D printer to print patient’s organ prior to the surgery to pilot run the surgery and avoid any issues. But are hospitals bound to ask for patient’s consent before 3D printing their organs. And post surgery, is the design data related to the organ safe or some third party can use it for directing their marketing activities for related products like insurance policies.
Lastly, who is liable for the product produced by the 3D printer, is it the owner of the printer, or the manufacturer or the printer or the person who actually created the product?
4. Shapeways is an online website (marketplace) which takes 3-D printing orders for merchants and hobbyists. Although their business model does entail requiring the user to assure that they are the rightful owner of the design, but it does not cross check the same citing the size of the marketplace. Shapeways responds to the copyright and intellectual property concerns from companies by taking down the designs highlighted as copyright and IP infringement issues from its website on the company’s notice.
