When Peter Vesterbacka visited China last spring, the marketing chief for Rovio, the Finnish firm behind the video game Angry Birds, saw fake Angry Birds products everywhere — and he was happy about it.
“I realized that China was already happening in a big way for us,” Vesterbacka said in an interview. “When you see all these knockoffs, you know that there is a lot of demand.”
That rosy view of an intellectual property problem that has vexed global brands for decades — and sparked friction in China’s relations with the US and others — underpins Rovio’s novel approach to the world’s fastest-growing consumer market.
While many companies go on the offensive against counterfeiters with legions of lawyers, Rovio is taking a mixed approach: waving a legal stick at some pirates, but seeking ways to cooperate with and appropriate ideas from others.
“It is definitely not a traditional approach,” said Kenny Wong (黃錦山), a partner at the law firm Mayer Brown in Hong Kong.
While skeptics may see spin behind Rovio’s enthusiasm for Chinese fakes, there are also benefits to accepting the reality that China is the world’s top source of intellectual property ripoffs and its courts cannot always help.
Rovio boasts 1 billion downloads of its video game, launched in late 2009, in which cartoon birds are hurled from a slingshot at pigs that stole their eggs. China, with 140 million downloads, is the second-largest Angry Birds market behind the US.
The firm is planning to unleash a blitz of retail stores and Angry Birds “activity parks” in China starting next month.
Paul Chen (陳博一), Rovio’s general manager for China, says the company is concerned about infringement on its intellectual property and does go after some pirates, especially those found to produce harmful goods.
However, he adds: “We tend to want to collaborate.”
Rovio says it is recruiting some IP infringers to be partners, and even offering some of them free ad space on the Angry Birds app.
It also now sells officially licensed Angry Birds balloons after Vesterbacka saw a pirated one for sale in Beijing earlier this year and liked the idea. He calls it “pirating the pirates.”
“This actually can be a successful model,” said Xiang Wang (王翔), an intellectual property lawyer with the firm Orrick.
The alternative — attacking pirates in court — can be a morass.
“You can win on paper, but paper means nothing. When you go to enforce it, local companies pay the judges, they pay the local government officials, so enforcement will take years,” Wang said.
Wong likens Rovio’s enthusiasm about knockoffs to the way new stars court media attention: Early on, there is no such thing as bad press, but that eventually changes.
“Once you reach a certain level, you don’t want the paparazzi to be around all the time,” he said. “I think probably it’s an initial strategy.”
Rovio’s retail strategy — going from zero to about 100 stores in the next year or so, starting in Shanghai next month — is another element of its strategy against fakes.
The shops will sell unique goods and purchases of official gear will unlock “digital rewards” in the game, Chen said.