Marketing

World Wide Web

Product (mathematics)

Cournot competition

Microeconomics

Product differentiation

Digital content

Commerce

Accounting

Operating system

Economics

Computer science

Business

Internet privacy

Mathematics

Geometry

Revenue

Intellectual property

Industrial organization

Research Policy

It is yet unclear whether patents and copyright are effective at protecting digital innovations. In this paper, we investigate this question using novel product-level data on mobile apps, in which we relate the use of both patents and copyright to (i) revenue performance and (ii) IP licensing. We theorize that these relationships depend on differences in product-level characteristics and that apps differentiated by their design are more likely and effectively to be protected by patents; apps combining elements of differentiated content are more likely and effectively protected by copyright. Our results support these predictions that product characteristics shape the appropriate contingent use of patent and copyright protection in digital products. These patterns are especially relevant to industries where digital products combine elements of differentiated design and differentiated digital content.

Profiting from digital innovation: Patents, copyright and performance