Intellectual Property

Financial Dictionary -> General Finance -> Intellectual Property

Intellectual property is a collection of laws that protect somebody's original ideas, creative works, discoveries, and designs from being copied or stolen. It is commonly cited in regards to literary and musical works, but covers anything from a tangible idea, to the design of a building. In a nutshell under intellectual property laws, the original creator has the right to pursue said creation and gain economic benefit without somebody copying or stealing said creation. Patents, trademarks and copyrights are closely linked under intellectual property.

An example of intellectual property in action could be a band member writing lyrics for a song. This band member now owns the intellectual property to those words and can pursue getting it recorded with his band, with legal protection should a rival band try and pass the song off as their own. Often record labels may buy the rights or a percentage of the profits from a song. It should also be noted that lyrics to a song ultimately do not make up the full scope of the work, since music etc has been added during production.

When the song is produced and available to buy, copyright laws come in to play. It would now be illegal for somebody to copy the CD or MP3 and sell it on or share it with others, because it is not their intellectual property and they do not have the right to profit or infringe of the profits of those who do.