Smartphone recipes: BlackBerry and Apple jam

There has been a fair amount of heated discussion currently around the use of the iPhone as a business Smartphone – or at least there has been in my circles (note to self: must get out more).  RIM (Research In Motion, makers of the BlackBerry) have had the business Smartphone market sewn up for years now, so some healthy competition is a good thing.  I’m certainly keen on iPhone’s ease of use and Apple design some very attractive looking devices, but is it ready for the business world?  Well, I would say that depends on your attitude to risk.  Leaving aside more subjective or prosaic considerations, such as physical vs. virtual keyboard, ease of email, speed of web browsing, battery life etc., the debate for the Enterprise usually boils down to security. 

The BlackBerry began as a business device, so it has security ‘baked in’, with end-to-end message encryption, and the ability to encrypt the actual hard drive of the device (which we do).  Having said that, the data travels through RIM’s infrastructure (albeit in encrypted form), which caused the United Arab Emirates to moot the restriction of the device because the data goes offshore as a result, and the Indian government to threaten a ban unless their security forces can access encrypted content.  However, RIM point to their security chops with a long list of certifications and the fact that it has “been approved for the wireless transmission of sensitive data, up to ‘restricted’ classification, by both NATO and the UK government.”.  Perhaps the ultimate accolade though, is that apparently the BlackBerry is the device of choice for criminals as it is so difficult for the police to intercept or recover any data from it

So how does the iPhone stack up on security by comparison?  Well, we recently saw that government ministers and civil servants have been denied iPhones, with CESG deeming them not secure enough.  It is possible to secure the iPhone using third party products (there’s an app for that), but it’s fair to say Apple are playing catch-up in this area, which is unsurprising given their initial consumer focus.  While the usability, design and sheer fun of an iPhone will appeal to many business users, there’s also the thorny question of the Apps.  Most Enterprise Smartphones will be locked down to prevent users downloading applications since they may contain malware or viruses, yet it’s arguable that the whole point of the iPhone is the Apps ecosystem around it.  So if you offer the iPhone to staff and allow them to download apps you’re letting your security guard down, but if you deny them the apps then you’re taking away its USP.  Additionally, many organisations block iTunes due to concerns over piracy, illegal downloads, storage overhead etc., but you need it to download iPhone updates.  So if you allow iTunes, do you then allow staff to hold their music collection on their PC?  What happens when the iPhone dies or they leave the organisation (or vice versa), are you responsible for backing up and restoring their music collection?  Echoes of Martin’s post on the importance of back-ups here. 

So, who’s winning the war?  Well RIM aren’t giving up without a fight and are pushing new touchscreen devices and their own app store, while Apple are working on security to lure the business user.  Give it a couple of years and there may not be much to choose between them.  In the meantime though, the BlackBerry would appear to be the weapon of choice for the more paranoid email junkie, while the iPhone reigns supreme in terms of usability and multimedia.  Though whether you agree with that will probably depend on which device you pray to every 5 minutes…

A metaphor for the importance of data back-ups

I usually leave the “geek” posts for Douglas, but a comment on this article about people incurring problems upgrading their iPhone 3G to iOS 4 caught my eye.

It is in response to another comment complaining that when the person had upgraded their iphone 3G to iOS 4 they lost five months of photos taken on their iPhone. The response:

A phone is the same as a computer. If you do not make backups of your important files, you don’t own those files–you’re only leasing them from Fate.

Aside from the philosphical question of whether you can “own” data or information, I think that the idea of “leasing data from Fate” sums things up brilliantly. It emphasises the fragile nature of data and IT systems, and why making regular back-ups to multiple sources is so important. IT can and does fail from time to time; software updates can and do go wrong; and viruses can and do cause mayhem. This is why we have business continuity and disaster recovery plans (which have hopefully been tested and shown to work).

Which reminds me, I must back-up my laptop at home again…

Photoshopping – the perils of using other people’s photos

Who owns a photograph? That’s the question that might be put before the courts in the US, after a model claimed that record label XL Recordings did not have permission to use a photo of her on the cover of Vampire Weekend’s most recent album Contra. You can see the photo here.

Ann Kirsten Kennis has brought an action for US$2m against the band, XL and the photographer who licensed the photo to XL, claiming that the photo is a polaroid taken by her mother, which must subsequently have made its way into the photographer’s hands after being in a batch of old polaroids donated to a charity shop. Ms Kennis claims that a signature purporting to be hers and consenting to the use of the photo must have been forged. XL Recordings has refused to comment pending sight of the court papers, but has said that “as is standard practice” it had licensed the photo under a licence agreement that contains “representations and warranties authorizing this use of the photo.”

No doubt this case will be settled before it gets to court, and we’ll never find out exactly what happened. However, the story does highlight the importance of ensuring that any use of photos taken by third parties is properly licensed.

Copyright in a photo
The copyright in a photo is usually owned by the photographer, as the creator of that work, and will remain so unless that copyright is transferred. Each print or digital image produced from the original negative (or digital file) is simply a derivative of that original, and will not in itself attract copyright.

Polaroids are interesting. There is only ever one print; the negative and the print are one and the same thing. This means that you can acquire physical ownership of the only manifestation of that photo (the Polaroid photo), but the copyright may still remain with the photographer (albeit he can do little to exploit that copyright unless he reserves a right of access to that print). The recent break-up of the world-famous Polaroid collection is a case in point.

Image rights
In addition to the copyright in the photo, the subject of the photo may also have rights. These are separate to copyright, but may take the form of a right of privacy or image right, and may impact on any proposed commercial use of a photograph of that person. The leading case on this involved Eddie Irvine and Talksport.

Some tips
Here are some things to consider when using photos taken by other people:

• Make sure that you have a written licence agreement that covers your proposed use.
• Ensure that the licence agreement contains representations and warranties from the licensor as to its right to grant the licence, together with an indemnity for third party infringement.
• Just because a photo is on the Internet, does not mean that there is no copyright, or that it is free to use. It isn’t.
• Photos on sites like Flickr may be offered for sharing on a creative commons licence. If so, then check the relevant licence terms for what you can do. They often prevent use for commercial purposes.
• Acquiring physical ownership of a print of a photo (even the “original”) does not mean that you automatically own the copyright, or can reproduce it.
• If the photograph is of a person, consider whether you need the consent of the individual to use that person’s image. This could take the form of a written release signed by the subject, or a representation from the licensor that the licensor has the subject’s permission.

New Technology Associate – Victoria Moore

Victoria Moore joined the Tecnology Information and Outsourcing Group (TIOG) at Brodies last month from Bird and Bird in London.

Victoria is a returning Scot.

You can read more about her, and see her photo, here.

Once she gets over the culture shock of the move back Victoria will start blogging here.

What is my company worth?

This is the question that crops up most when chatting to technology entrepreneurs. The answer is “What someone is willing to pay”.  So how do investors or buyers work out how much to pay?

Firstly, investors will have in mind a rate of return on their money which substantially outperforms the stock market.  History shows that only 2 out of 10 companies which had serious potential will make it. So this will be factored into the investor’s expectations as to rates of return.  Your financial projections therefore need to show growth and returns which will exceed these minimum expectations.

All business plans I see have the usual graph showing the hockey-stick-shaped growth curve. However, it needs to be substantiated.

Most investors will assess a company’s potential by considering the market and working backwards from there – and so should you. The size of the overall market; market demand for the product; likely market share; timeframes before sales into the market; internal and external risks before having a robust market-ready product; barriers to entry for the competition following launch of your own product – all these will have a bearing on what an investor would be willing to pay for a slice of your company.

Whilst every investment proposal is different, I could probably predict, based on statistical evidence, what share of your company you are likely to have to give to investors on each funding round.  I could also predict the average timescales for securing your investment – which have progressively lengthened each year since the dotcom bubble burst (along with timeframes for likely exits).  Combine the statistical evidence on likely dilution on each funding round with the timeframes for raising money – you soon realise that you should be trying to raise as much money during the funding round as may be required to achieve your objectives.  You should certainly be ensuring that you are raising enough to fully fund your business plan or at least hit significant milestones, with some margin for error.  The most common problem is raising money to see your business through a minimum period without considering whether (at the end of that period) the value of the company will have been enhanced by the achievement of key objectives, either in terms of product-development or market penetration.

Coming back to valuations, it may be that your investor is sceptical about your ability to meet your business plan objectives – hence is suggesting a lower valuation than you believe your business plan justifies.  One way of bridging this valuation gap is to agree to disagree on the initial valuation. Give the investor his share of the company based on his valuation, on the understanding that (if your assumptions turn out to be correct) the shareholding will be re-balanced so as to give management a greater share of the overall pie.  This is a win-win situation where management are incentivised to perform and investors have the comfort of knowing that they have not overpaid at the outset.

Ultimately, no-one (be it management, investors, founders) will see any returns unless the team brings the company over the finishing line. This might be a sale of the company to a competitor or customer; floating the company on the financial markets; selling your key technologies. That will be the true test of whether the original valuation assumptions were correct.

Peter Pan and the Copyright that Never Grows Up

Picture the geeky IP lawyer on holiday with the kids watching a “Peter Pan” show in an Italian theme park near Ravenna (not a Disney park).

His mind wanders: “Isn’t Peter Pan still protected under copyright law?”.

The answer is “yes and no.” (Typical lawyer’s answer).

Normally in Europe (and most other countries) copyright in a work lasts for the life of the author plus 70 years. 

JM Barrie died in  1937 – so copyright ran out in 2007.

However, Peter Pan is an anomaly under UK law.

Because Barrie gave the copyright, and thus the right to earn royalties,  to Great Ormond Street Hospital for Sick Children the UK has effectively given Peter Pan perpetual copyright.  For the law geeks out there it is Schedule 6 of the Copyright, Designs and Patents Act 1988.

However, it seems that the UK extension is not recognised in other jurisdictions, so the Italian theme park is free to carry on its show.

Ciao