Zimpapers Logo

Aleck Ncube
INTELLECTUAL Property plays an important role in the development of ICTs. It also affects how enterprises and SMEs can benefit from using ICTs in their daily activities.

There are several reasons why IP is important to E-Commerce. IP is important because the things of value that are traded on the Internet must be protected, using technological security systems and IP laws, or else they can be stolen or pirated and whole businesses can be destroyed.

IP is involved in making E-Commerce work. The systems that allow the Internet to function — software, networks, designs, the user interface, and so on are forms of IP and often protected by IP rights. Trademarks are an essential part of E-Commerce business, as branding, customer recognition and good will, are essential elements of web-based businesses, are protected by trademarks and unfair competition law.

Developments in ICTs can be said to be the backbone of the new economy, which is referred to as the “information economy.” This is the economy, which is driven by ideas, information and knowledge. Wealth creation is more determined by access to information and the ability to use information at hand to one’s advantage. In the new economy, we are witnessing a change in corporate thinking where the market value of an industry is increasingly in its “intangible assets,” replacing the conventional thinking, which linked it to tangible assets. With the help of ICTs we see how industries are changing their concepts of wealth creation by taking advantage of the information available.

The Internet, Mobile Communications, Video and Data conferencing, CD-ROM, Electronic Data Interchange (EDI). Standardised messaging and business software allows purchasers and suppliers to handle transactions electronically via phone lines) and networking are increasingly taking a central role in determining the competitiveness of an enterprise. Today SMEs, which take advantage of such ICTs, in a conducive environment, can tremendously reduce their operating costs as opposed to their competitors.

As trade liberalisation continues through the World Trade Organisation (WTO) mechanisms, development of ICTs increases the intensity of competition since it removes some of the major barriers to trade, such as national boundaries and distance. SMEs, which normally used to compete only with domestic competitors, are suddenly faced with external/foreign competitors and not only foreign SMEs but also foreign multinationals. At the same time such an environment also opens opportunities to SMEs. It is now possible for SMEs at relatively lower costs to reach out to clients in markets which until a few years ago were a far-fetched dream. With a click of the ‘mouse’ SMEs can access information on the market, source of its raw material, possible partners etc.

In order to face the challenges and benefit from the opportunities brought about by the ICTs revolution, SMEs are advised to take a more serious look at Intellectual Property. SMEs have to look at IP not as a mechanism to prevent others from taking advantage of a technology or entering a market but rather as a very useful business tool. SMEs that are “IP-Smart” stand a better chance of reaping the benefits associated with ICTs. Although generally speaking, the Africa region is considered to be a late comer in the new ICTs world, the relative advances it has had, at least in the Internet area, in the recent past has provided the SMEs in this region a modest but important opportunity to start participating actively in the new economy. All African countries are on-line, albeit mostly in major cities, this is a major step in empowering the SMEs with accessibility to information and its easier and wider dissemination as well.

E-Commerce and SMEs

Electronic-Commerce or e-commerce as it is widely known is a phenomenon in which enterprises use the Internet in their commercial activity. The dawning of the Internet era has made it possible for SMEs to trade globally. For physical goods, the Internet can be used as a facilitator of business exchange. Through the Internet SMEs can electronically get in touch with potential customers, negotiate, handle product orders and finally receive payments for the goods, which would be delivered using conventional ways, e.g. by postal services. On the other hand, for intangible goods like music and software the Internet becomes not only a system for facilitating sales but also a system which can effectuate delivery of the goods.

A presence in the Internet is very important if SMEs are to take advantage of e-commerce, this being the case before embarking on e-commerce it is worthwhile if SMEs; identify and take stock of IP assets they own, for example, patents, patent applications, innovations, which they think are patentable, designs, web site designs, music, photos, technical writings, trade secrets, contracts which they think can affect their IP rights, etc.

Take measures to protect their trade secrets. Most SMEs use Trade Secrets as business strategy some of them not knowing that such secrets can be legally protected.

Make sure, when they design their enterprise’s web site, that they know who owns the web site presentation and content and every aspect of IP in it. This is more important if they have used the services of a consultant or other company in designing their web site. Make sure that they acquire written permission to use other people’s material in their web site, including through links and framing. Choose a domain name, which should preferably be distinctive and protectable under trademark law. It is important to make sure that the chosen domain name is not identical with or confusingly similar to the trademark of another company.

Avoid making disclosures that would negatively affect or destroy their IP rights. This is because under many national laws patent protection may not be granted if an invention has been publicly disclosed even after a short period of time before filing the patent application. Take special care when they enter into contracts. Contracts should be reviewed carefully before being signed. This is because through contracts, IP rights may be sold or licensed or even given away. Bad contracts can result in litigation and unnecessary expenses.

It is important to note that in order to have a competitive edge over its competitors, SMEs that take advantage of ICTs must also effectively use the IP system. A combination of IP protection and ICTs enhances the competitiveness of SMEs. With such a combination, the size of an enterprise is often no longer a major factor in determining enterprise competitiveness.