Those are recent and famous examples of intellectual property for which ownership must be legally acknowledged. And now it appears that payment must be made for a combination of the two.
Researchers at Cornell University's agricultural research station in Upstate New York are charging farmers for the intellectual property (IP) rights to grow and market apple varieties developed by the unit.
It is certainly interesting to read about apple IP that does not involve smartphones. But it does raise questions about the extremes to which our attempts to extract value from intangibles have driven participants in this economy.
It is worth noting that up until a few years ago, hardly anyone identified, let alone tried to charge for intellectual capital. It was presumed to have been 'baked in' to the price of whatever was for sale. But as technology's contribution to the economy generally and to the creation of wealth for a few, specifically, became manifest, assigning value to ideas, concepts and their outputs have become sources of profit themselves.
In the case of agricultural products, researchers have begun to charge for new varieties based on the projected 'excess profits' farmers and wholesalers may enjoy due to the special features these products are said to possess. The new apples are supposed to have taste calibrated to the demand for what are reported to be the most popular types. In addition, they are bred to better withstand the long periods of travel and storage that contemporary fruits must survive in order to be sold at a premium to today's discerning consumers.
This makes some business sense. We are famous for paying up to get the brands we want, Apple (the tech company) being a perfect example for the growers of the edible kind. If the apples with IP value sell better than their competitors, then the relative worth of the research that went into creating them will have been established.
However, for generations such knowledge was passed along free of charge. The legend of Johnny Appleseed being a fanciful illustration of that process. The Agricultural School at Cornell University, which created these varieties, was established and paid for under the US's 19th century 'land-grant' system, making it a public university specifically endowed with tax revenue for the purpose of propagating knowledge of use to farmers.
The question is not whether such research adds value: it most certainly does. But as in so many other aspects of contemporary economic discourse, this development does raise the specter of privatization of public resources at a time when citizen consumers are questioning both the value their tax payments generate and the appropriateness of the benefits' distribution. JL
Don Cazentre reports in the Syracuse Post-Standard:
After a century of free access to new hybrids apple growers in New York this year have agreed to pay Cornell fees and royalties for the right to plant and sell the university's two newest varieties: SnapDragon and RubyFrost.
In the 1960s, research scientists at Cornell University's agricultural station in Geneva launched a new breed of apple, which they called Empire. It was a hybrid of Red Delicious and MacIntosh, two of the most popular apples in America. It was bred to be juicy but firm, sweet and crunchy.
"It was a good apple, but it was really slow to catch on," said Walt Blackler, who operates Apple Acres, a wholesale grower in LaFayette. "It wasn't until the 1980s that there was enough (grown) to make them known in the market. Then in the 1990s, they were overproduced and flooded the market and that was a big problem.
"That's what we're trying to avoid."
Blackler tells that story as a way to explain something that seemingly defies business sense.
The growers will pay for the young trees that Cornell provides them, then pay a licensing fee for every acre they plant, and send the university a percentage of the revenues from every bushel they sell.
"We'll be paying all along the line," said Blackler, who acknowledged that some of the cost cost will be passed on to consumers. "But we're happy to do it."
Why pay now for something that used to be free?
It's partly because the Cornell deal will help the growers manage the marketing, development and supply of new apple varieties, to avoid the situation that hurt Empire apples for so long, Blackler said. And the deal means the new apples will only be grown in New York.
"In the past, new apples were planted willy nilly," he said. "We need to manage the introduction and promotion. We need to create the demand."
"And," he said, "we're creating a New York exclusive product."
Plus, Cornell promises to put some of its revenues into its apple research and breeding program. Neither Cornell nor the growers could provide a figure for that revenue.
"We think it's going to be positive for us in the short term, for bringing the apples to market, and better in the long run with the apple research," said Blackler, who is treasurer of the new group called New York Apple Growers, the association formed by the growers who have agreed to pay for the rights to SnapDragon and RubyFrost.
This is not the first time Cornell has charged growers based on its control of the "intellectual property rights" for new food varieties - one such agreement came a few years ago for new potato varieties that were developed specifically for the potato chip industry.
But this is the first time it's been done for apples, one of the most iconic foods in Cornell's long breeding history and one that consumers are especially likely to buy as a specific variety. Those looking for SnapDragon and RubyFrost this year, by the way, should keep a sharp lookout - only a hundred or so bushels will be sold this year and they aren't expected in large numbers until the 2015 harvest.
Cornell has been breeding varieties of foods like grapes, berries and apples since the 1890s, but the law that allows research institutions to retain and charge for the intellectual property rights has only been on the books since 1980.
The university is able to apply for patents for breeds it develops and to trademark the names, said Jess Lyga, Cornell's plant varieties & germplasm licensing associate.
But it doesn't arrange the deals to charge for the rights in in every case, she said.
Bottom line: The new variety needs to show that it has a potential market - that it can make money - before the university works on such a deal.
"As something is developed that has possible commercial application, that's when we get involved," Lyga said.
That can take time to figure out.
Cornell horticulture professor and researcher Susan Brown has led the team working on the two new apple varieties for 15 years.
Brown still crosses different apple varieties to produce a new breed the old fashioned way - using bees to pollinate one variety with another. Modern technology speeds up the process by allowing the researcher to look for DNA markers and other traits that help determine which varieities to cross to achieve specific results - from disease resistance to firm texture.
Once it became apparent that the two new varieties had commercial possibilities, Lyga's office went to work to create the deal that would identify growers who would pay for the rights. "These apples were fast-tracked," she said, noting it still took more than a decade to bring them to market.
The growers got together to create the association called New York Apple Growers. Its sole purpose is to create a "club" whose members will pay Cornell the rights fees. (There is another group, the New York Apple Association, which represents most growers for other purposes). Creating that club to pay rights fees was a first for Cornell, Lyga said.
Until this summer, the two apple varieties Brown's team were working with were known as NY1 and NY2. In a ceremony at the Geneva research station in August, they were christened SnapDragon and RubyFrost.
SnapDragon is an early ripening apple that is described as as sweet and crisp. RubyFrost ripens later in the season and is juicy, a little tart and refreshing. Both were bred to withstand long periods of storage.
If all goes well, they are likely to command premium prices when they come to the market in greater numbers in a few years, Blackler said.
New York's growers are hoping to duplicate the recent success of HoneyCrisp, a crispy yet juicy variety developed at the University of Minnesota. It has been the hottest new breed in recent years - but its rights are not protected. Many New York growers have given it a try.
The projected price for the two new varieties when they fully reach the market in a few years is difficult to pin down, Blackler said, but he suggested HoneyCrisp could be a guide. This year, HoneyCrisp is selling for around $2.49 per pound, compared to about $1.79 per pound for a more common variety like MacIntosh.
"HoneyCrisp are difficult to grow," Blackler said. "Getting the critical mass took a long time. We're hoping to get that critical mass for RubyFrost and SnapDragon in about five years."
Blackler, whose orchard has about 15 different varieties, said he hopes the money that the growers have agreed to pay to Cornell will help with new breakthroughs.
"We'd all like to see apples that are disease resistant, but too often those apples just aren't any good," Blackler said.
"We selected these apples (SnapDragon and RubyFrost) because they are good," Blackler said. "We hope people will go for them."
New York's newest apples
SnapDragon: It's an offspring of Honeycrisp and an unnamed apple in Cornell's breeding program. It's an early ripening variety that is crisp and juicy, and is said to be similar to Jonagold.
RubyFrost: It's a hybrid of Braeburn and Autumn Crisp. It's a late-ripening variety that is tart, juicy and refreshing. Cornell says it will be popular with fans of Empire and Gala.
Availability: Only a few hundred acres across the state are yielding fruit this year, so they will be hard to find. SnapDragons are mostly sold out; RubyFrosts will be hitting scattered markets in the next few weeks. Expect to see them more readily available by 2015.
Bred by Cornell
Cornell University has been developing varieties of fruits and vegetables for more than a century. Only a few are licensed. Here's a small sampling of Cornell breeds:
Apples
Cortland, Macoun, Empire, Jonagold, Jonamac
Grapes
Cayuga White, Chardonel, Noiret, Traminette
Cherries
Kristin, Sodus, Somerset
Raspberries
Double Gold, Crimson Night
Nectarines
Hunter, Morton, New Yorker
Peaches
Eden, Brighton
Strawberries
Purple Wonder, Eden, Empire, Clancy
Plums
Mohawk, Seneca
Potatoes
Lamoka, Waneta
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