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The Smartpass & the Road to IP

The Copyleft's program is that creative goods should be distributed freely over the Internet, with the material fuel for the creative process supplied by either the spirit of volunteerism or government subsidy.

But we rely on non-markets and government subsidies for another major product -- roads. And, as TCSDaily points out, it does not really work too well. We pay a huge price in congestion and inconvenience. So more attention is being paid to how to move roads into a market system, so people can save what they actually value most -- their time.

The same slant needs to be applied to creative goods. Not, "how do we get a subsidy?" but "how do we make markets work?'

The Internet taketh away, but it also giveth, and one of the things it giveth is expanded opportunities for control of creative products through DRM, watermarking, and deep packet inspection, and, consequently, the opportunity to create better markets that now exist, similar to the way the smartpass is revolutionizing the prospects for markets in roads.

posted by James DeLong @ 7:12 AM | Free Culture Movement, Markets: Business, Investment & Innovation, Prices, Terms, and Licensing

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As ever, please provide some kind of reference when you make extravagent claims like: "the Copyleft's program is that creative goods should be distributed freely over the Internet, with the material fuel for the creative process supplied by either the spirit of volunteerism or government subsidy".

A cursory glance over the literature will show that you have ommitted quite a range of positions from people who endorse copyleft, most notably those who believe it can be a sound basis for business models!

Posted by: Tom at February 14, 2007 7:37 AM

The only business models I see presented are advertising, patronage, and complements -- any of which are highly limited substitutes for markets.

Posted by: J.V. DeLong at February 14, 2007 7:47 AM

Ah, so a few examples already that contradict your original post.

Also, how is advertising not a market? What we're talking about there is using markets that complement and facilitate the distribution of material, and of course it's potential is limited because there aren't many art forms whose production costs can be met by advertising revenue. But it's also rash to dismiss it outright as a an insignificant business model.

Can you clarify what you mean by "complements"? Do you mean things like physical CDs with inlays, etc. to accompany the copyleft-licensed music? If so then I think it's pretty hasty to claim that there is a limited market for that sort of stuff. The same goes for events.

Here is another quick example, by the way. In Reading, UK, an organisation I started is running workshops with local youth groups and schools. The artists get paid for these workshops, and we are working on establishing strong links between the network of artists and local businesses so they can gain more contract work. The revenue isn't tied to their work at all, but it is a useful revenue stream that can support their work. As with all business models in the arts, it's not a lviing wage plus luxuries but it is one more valuable way to finance the arts.

This diversity and innovation, now being explored by the likes of OpenBusiness, is what you fail to recognise, and indeed imply doesn't exist. It's a shame, there are so many interesting markets out there that you're not looking into just because they reject "all rights reserved" copyright as their basis.

Posted by: Tom at February 14, 2007 8:15 AM

Tom, it is fine, at least with me, if creators try to carve out markets marked by complementaries, ads, services. You're right that such markets show how diverse business models can arise, but lets not forget the importance of "all rights reserved" business models and a system of copyright that allows creators to selectively waive those property rights. The copyleft crowd would have everyone believe coyright owners should be forced to waive their property rights in the way the copyleft does.

Posted by: Noel Le at February 14, 2007 3:08 PM

I would second the below comment, as it is yet another example of straw-horsism, which seems to be the prevailing ideology at IP Central:

"As ever, please provide some kind of reference when you make extravagent claims like: "the Copyleft's program is that creative goods should be distributed freely over the Internet, with the material fuel for the creative process supplied by either the spirit of volunteerism or government subsidy".

From my following of the free culture movment I would simply observe that they want to be free to build there own free culture space, distributing code and programs and perhaps music for free, as they like without being attacked by the content fascists who are constatntly striving to make this illegal, by for example outlawing P2P technology itself.

Simply follow the story over at Groklaw and it would be clear that the content industry's goal is to make free culture illegal.

Certain free culture advocates my want to lessen the power of certain monopoly industries, but don't they have a right to do so??

Posted by: en at February 14, 2007 9:07 PM

"The copyleft crowd would have everyone believe coyright owners should be forced to waive their property rights in the way the copyleft does."

No significant player from the free culture movment belives this statment, which Noel Le has pulled straight out of thin air...

Posted by: enigma_foundry at February 14, 2007 9:26 PM

Mr. Enigma

The copyleft is “free” to use their information freely, but why do they continually insists on using others’ information freely?

Sure, free culture advocates can oppose the established copyright industries, but this suggest they are trying to force copyright holders to waive their property rights. If you’re looking for copyleft advocates who support this position I “pulled out of thin air,” look at the person who posted just above you- wait, that’s you:)

Posted by: Noel Le at February 14, 2007 10:06 PM

"The only business models I see presented are advertising, patronage, and complements -- any of which are highly limited substitutes for markets."

Someone had better tell Google that advertising is a "highly limited substitute for markets."

Posted by: Tim at February 15, 2007 11:13 AM

Somebody better tell Tim-Google isn't a content producer.

Posted by: Solveig at February 15, 2007 2:36 PM

"The copyleft is “free” to use their information freely, but why do they continually insists on using others’ information freely?"

They don't. However, they do not want to allow content producers to run over the First Amendment to protect content (see DMCA, just ask Ed Felten, Dmitry Skylarov or dvdJon)

Also, they do want to keep the productive pwoer of tthe PC in the hands of the people and not have it stolen away through Treacherous Computing.

Note to Solveig:

Google is a content producer, in the sense that aggregation produces more than the sum of the parts. They are producing meta-content. Words are to letters as Google is to old media...

Posted by: enigma_foundry at February 16, 2007 12:11 AM

Enigma, that argument about Google is stretching things. I think you're wrongly focusing on the transaction involving rather than creation of content. Would you consider the Post Office a content producer?

Posted by: Noel Le at February 16, 2007 12:26 AM

Enigma's comment here echoes what I said in a recent post about the FCM preferring the word "content," as it commoditizes creative works. Content then is just a bunch of Legos that Google can build into a cool sailboat or dinosaur, and apparently the sailboat or dinosaur is more important than the individual Legos.

A far different creative process went into producing each of those Legos -- Gnarls Barkley's "Crazy" differs from "Little Miss Sunshine" or James Patterson's "The Fifth Horseman" or "Super Monkey Banana Blitz" for the Wii (played it last night, what a long list of credits; you float on the screen eating bananas while the many names scroll by). Google produces its "meta-content" with an algorithm, albeit a creative one. If Google creates an algorithm that produces an original top song, movie, novel or video game, then it's a content producer. I won't hold my breath.

Posted by: Patrick Ross at February 16, 2007 10:38 AM

The free market cannot efficiently produce a pure public good, such as information, due to the free rider problem.

However, trying to turn information into a club good using copyrights and patents, doesn't work either because it creates monopolies, and possibly a tragedy of the anticommons.

The free market has therefore yet to demonstrate an efficient way to produce information.

However, an information gift culture (that freely shares information) *does* produce information efficiently.

Traditional scientific research is such an information gift culture.

The way forward is not through more restrictive licencing and patents, but through less restriction.

Posted by: Gustav Bertram at February 16, 2007 11:53 AM

Somebody better tell Tim-Google isn't a content producer.

We could get into a semantic argument about whether or not the code to Google's search engine qualifies as "content," but certainly you can't deny that from an economic perspective, Google's products have similar characteristics to a Hollywood movie: high fixed costs and very low marginal costs. If Google can generate billions of dollars in profits from advertising, why is it unreasonable to suggest that many content creators could do likewise?

If you don't like the Google example, what about broadcast television? Does Jim DeLong claim that TV ads are "highly limited substitutes for markets."

Posted by: Tim at February 17, 2007 12:18 PM

***but certainly you can't deny that from an economic perspective, Google's products have similar characteristics to a Hollywood movie: high fixed costs and very low marginal costs.***

What? And how does this tie in to your discussion of content markets?

***If Google can generate billions of dollars in profits from advertising, why is it unreasonable to suggest that many content creators could do likewise?***

Again, Google is not a content company.

Tim, by proposing the elimination of the DMCA and DRM, you are *forcing* content creators onto the ad business model. Saying this, and as you have elsewhere, that content creators can just sell music lessons and T-shirts, just makes your argument sound like more of a stretch; especially when considering that your bottom line is to achive more "freedom to tinker" at the expense of creators.

Posted by: Noel Le at February 17, 2007 4:18 PM

hmmm.... well I suppose that if Google's not a content producer, then neither are Urban Designers, after all, they just aggregate the work of Architects...

Posted by: enigma_foundry at February 18, 2007 7:33 PM

"Tim, by proposing the elimination of the DMCA and DRM"

Tim hasn't said that any company should be forced to abandon DRM. His freedom-based perspective, IMHO, would probably not want to force anyone to do or not do DRM. However, realizing the anti-freedom nature of the DMCA, Tim is in favor of abolish the special government support of DRM, which has taken it's present form in DMCA...

Posted by: enigma_foundry at February 18, 2007 8:48 PM

Enigma, yes, Tim is against the "anti-freedom" nature of the DMCA. He takes an ideological, not an economic or policy position against the DMCA.

Posted by: Noel Le at February 18, 2007 9:03 PM

"He takes an ideological, not an economic or policy position against the DMCA."

I don't really see I difference--read Hayek on Patents, for a Free Market approach--that meshes quite well with freedom based ideology.

I would also refer you to an excellent book by Amartya Sen "Development as Freedom" which makes a very persuasive case that our Freedoms and economic betterment are linked, and therefore it is quite silly to sacriface one for the other, as you will end up with neither...

Posted by: enigma_foundry at February 18, 2007 11:37 PM

Enigma, the difference between taking an "ideological" vs economic or policy approach to IPRs, is that those who argue from an ideological point of view rarely weigh and balance factors. Notice that ideological perspectives often advocate "perfectly free markets" and "perfect competition," which are themselves ideologies, not real world functioning economic models.

Posted by: Noel Le at February 19, 2007 2:49 PM

"Enigma, the difference between taking an "ideological" vs economic or policy approach to IPRs, is that those who argue from an ideological point of view rarely weigh and balance factors.."

That depends how intelligent and mature their belief systems are. It is a hallmark of mature belief systems not to make informational exclusions, that is to accept all information from all fields of knowledge into an evolving system, rather than a received set of ossified principles.

I would refer you to the above referenced book by Amartya Sen for his extended discusion if informational exclusions.

Posted by: enigma_foundry at February 20, 2007 8:33 PM








 
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