Last week I posted an item on the new National Academies’ study on on Copyright in the Digital Era: Building Evidence for Policy. Today, I would like to follow up by highlighting one of the studies recommendations: the need for better data. The study notes that “the federal government needs to expand the collection of data on the digital economy as well as on intangible assets such as intellectual property holdings and their use.” To do so, they recommend an ambitious course of action:
Agencies such as the Bureau of the Census, Bureau of Economic Analysis, National Science Foundation, U.S. Patent and Trademark Office, and the Copyright Office should form an interagency group that, along with expert advisors, would study the advisability and feasibility of an ongoing and systemic national business survey of intellectual property. Like the Business R&D and Innovation Survey (BRDIS), the IP survey would include samples of businesses in the service and manufacturing sectors. It would probe uses (e.g., licensing) and holdings of intellectual property and costs of acquisition and maintenance. Because of the nature of the production of digital goods, including the prominence of user-generated content, the business survey should be complemented, if at all feasible, by a detailed consumer survey of user-generated content and use. This would include, among other things, measurement of the amount of production and distribution of digital content by non-business entities (i.e., by users), and also measurement of the consumption of such content by both business and the population at large.
Readers of this blog will know that I routinely call for better data on intangibles. As I pointed out recently in our analysis of the federal budget, government statistics are a key intangible asset. The importance of that data was highlighted in a Washington Post story on attempts by conservative activists to kill off a key government data collection activity. It is not just government programs and policy making that is tied to this economy data. Companies, such as Target use the data for key business decision.
Our need for more and better data is even more accute in the I-Cubed (Information-Innovation-Intangibles) Economy. As noted in our 2005 study Reporting Intangibles: A Hard Look at Improving Business Information in the U.S.:
American businesses, investors, regulators and policymakers are flying blind. The United States is now in an intangible economy, but financial reporting and accounting systems can’t deal with intangibles. Our business reporting system is, in many ways, not even adequate for the Industrial Age, let alone the Information Age. As a consequence, business, investment and economic policy decisions are being made “in the dark” (to quote the title of a recent study).
The situation has gotten somewhat better–at least in awareness. Starting this summer, the BEA will start counting R&D as an intangible investment rather than an expense in the GDP data. On the company side, a group known as the International Integrated Reporting Council (IIRC) just released their Consultation Draft on the International Integrated Reporting Framework — which includes specific breakout for intangibles: human, social and intellectual capital (see previous posting).
The National Academies’ call for improved data on how companies treat their copyright and other intangible assets is one more step in the right direction.