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.

Continue reading The Smartpass & the Road to IP . . .

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

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An interview with Jacqueline Charlesworth of the National Music Publisher's Association.

posted by Solveig Singleton @ 3:46 PM | Markets: Business, Investment & Innovation , Media , Prices

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Longtime readers of this blog will know I'm a fan of subscription music services, and have been a Napster to Go member almost since it debuted almost two years ago. I still have tech woes -- don't get me started on the problems I had this week integrating a new Creative Vision:M -- but I love the service anyway. But when commenting to a Nick Carr blog the other day, Nick reminded me I'm in the minority in my love for music subscriptions. Subsequent commenters repeated some of the same arguments we've heard against subsciption services, namely that music needs to be owned. Perhaps I come at this differently from most consumers because I understand no end-user owns music; they have purchased a set of rights from the actual owners, in the case of a song the songwriter(s) and the performer(s).

Will subscription services survive? Nick's right, they haven't gained a lot of traction in the market. Their future will also be impacted by a Copyright Royalty Board proceeding that I'll discuss further below. But as an artists' advocate, I would note this: we hear that the digerati won't buy CDs any more because they're all about online consumption, yet the average iTunes customer is only spending $22 total. At $15 per month, I've already given Napter to Go over $500. I have over 1,000 songs on my player that I don't have a CD of, but they've all been paid for. Can the $22 iTunes customer make the same claim about all of the songs on their iPod?

Continue reading Music Subscription Services and Songwriters . . .

posted by Patrick Ross @ 9:39 AM | Markets: Business, Investment & Innovation , Prices

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What is the current consumer view on DRM? Perhaps they focus on the lack of interoperability between iTunes songs and most non-Apple music players, or the inability to play various music services on the iPod. While some online music services and music players are free of DRM, these issues highlight incompatibility, or fragmentation, between DRM systems. This fragmentation does not simply result from preferences of technology or content companies, but rather the business dynamics they work under.

Although standardization of DRM systems would result in lower prices for digital goods, this has not occurred as some scholars like Suzanne Scotchmer of Berkeley predict. In Fragmentation versus Standardization in the Market for Digital Rights Management Solutions (July 2006), several rearchers at Law and Economics Consulting Group ask why, and find that fragmentation of DRM solutions arises from market competition and the different uses of DRM that firms leverage. 10. Acknowledging that fragmented DRM schemes not only prevent price reducation but also limit the value of products for consumers, the researchers point out the ease enabled by low switching costs between different proprietary brands. 17. They note that users often buy several different DRM solutions at once, as content owners often release their content in many different formats. 18.

However, the benefit of fragmented DRM systems arises in competition to create products with greater functionality and value, thus bringing more innovation to market in the long term. 20. Competitors find ways of leveraging existing content sources and perhipherals, such as RealNetwork’s reversing engineering of Apple’s DRM around iTunes. 20. The DMCA may bring restrictions, yet the market has its own correcting balance through increasing the flexibility with which consumers can enjoy content. 23. Finally, as no DRM systems have become industry standard "vendors compete for more content owners by developing secure DRM solutions, and for customers by offering a wider selection of content and more flexibility with the purchased product." 20.

… when the iTunes store first opened in April 2003 songs purchased were only able to be played on 3 computers… RealNetworks, MusicMatch and Wal-mart all entered the digital download market, and Wal-mart offered downloads for a mere $0.88 that we able to be played on up to 10 computers. It is very likely that Apple’s choice to lower restrictions on its DRM protected content was a direct result of increased competition in the digital download market… although there could be a wide breadth of restrictions limiting customer’s right of fair use, the competition among online stores has increased users’ flexibility with protected content. 23.

posted by Noel Le @ 4:12 PM | DRM , Prices , Standards

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Interesting discussion over at the U. of Chicago blog, concerning the closing of the Xbox to Linux users via tinkering. Randall Picker starts off with a post in response to Ed Felten.

Here, I sought commentary from a game industry insider and add some of my own. My insider, who wishes to remain anonymous, responds as follows:

Continue reading Opening and Closing the Xbox . . .

posted by Solveig Singleton @ 1:45 PM | DMCA , DRM , Free Culture Movement , Games , Prices , Software

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WHO has been debating the need for alternatives to patents for inspiring new, cheaper medicines for third world countries.

Elisabeth Rosenthal describes the WHO report in "How drug patenting fails the world's poor" in the International Herald Tribune on May 21:

Governments should therefore develop and finance an alternate system for drug development and distribution in the developing world, the report concluded. More controversially, it suggested that drug companies should not seek patents in poor countries.

The report is ably critiqued in an editorial by Andres Mejia-Vergnaud in the Manila Times, "Drug Delusions at the WHO.":

The “Global Framework” fundamentally misdiagnoses the problems faced by the poor, claiming the market has left the poor without treatments for their myriad diseases. In reality, the vast majority of the diseases of poverty can be treated with existing, cheap, off-patent drugs. While there remain some diseases, such as leishmaniasis, that lack adequate cures, these kill far fewer people than diarrhea, chest infections and malaria, for which treatments exist. The real problem is getting existing medicines to those in need—a problem the “Global Framework” does not even acknowledge.

Shockingly, these barriers to access include extortionate taxes and tariffs on drugs: 37.8 percent in Kenya and 28.6 percent in Brazil.

Most government-directed initiatives to develop new medicines have ended in failure. At best, such schemes are poorly managed and wasteful.

posted by Solveig Singleton @ 11:43 AM | International , Patents , Pharma , Prices

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Yes, another blog on Stephen Colbert, but this one doesn't debate whether he "spoke truth to power." First, let me say I'm a big Stephen Colbert fan and I watched his address April 29th to the White House Correspondents Dinner on C-SPAN. My wife, who was lucky enough to be at the dinner, confirmed my feeling on his performance, namely that Colbert bombed. Maybe he "spoke truth to power" but he didn't "speak funny to me." I forgive him, though, and I'm still watching his show (his interviews with US House members are pure genius). But there's another, more interesting debate surrounding his speech, as Stacey Higginbotham of The Deal reports on their Tech Confidential blog.

Continue reading The Viral Video Business Model . . .

posted by Patrick Ross @ 4:22 PM | Content Controls , DRM , Free Culture Movement , Internet , Markets: Business, Investment & Innovation , Media , Prices

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that the download music market is in its infancy but is growing and maturing, and that patience will yield dividends for creators. CNET's Candace Lombardi reports on an international, cross-industry effort to develop better tracking mechanisms for online legal downloads so that rights holders can be more accurately compensated.

ADDENDUM: I see Jim was posting on this at the same time I was. Well, it's worthy of two posts.

posted by Patrick Ross @ 9:45 AM | Markets: Business, Investment & Innovation , Prices

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In his blog on satellite radio and devices that can anticipate specific tracks, record them and permit reuse later, Jim has hit it on the head -- there is a difference between a radio service and a download service. They are licensed differently, and while I can see why XM would want to avoid negotiating a download license as Sirius has, I don't see how it could be avoided. As artist Anita Baker and songwriter Victoria Shaw said at a hearing last week, they just want to be paid for their work, whether it's downloaded to keep on iTunes or XM. It's also not clear to me why we need legislation to accomplish what seems self-evident, but I suppose legislation can be seen as preferable to litigation.

Of course the legislation in question, the PERFORM Act by Senators Feinstein, Graham and Frist, contains more than this provision.

Continue reading Legalism Exchange . . .

posted by Patrick Ross @ 10:25 AM | Access: Commons, Fair Use, Orphan Works, Public Domain , Content Controls , DRM , Internet , Legislation and Legislators , Liberty and IP , Prices

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Yesterday the Court heard oral arguments in the Ebay v. MercExchange case. The first round of assessments suggests that the Court was not particularly sympathetic to Ebay's attacks on injunctions, but is very aware of the issue of patent quality and the link between the two (i.e. improvements to patent quality will strengthen the legitimacy of injunctions).

Promote the Progress links to J. Matthew Buchanan's article in Law.com (you need a subscription--how come one has to pay for all the good stuff? Oh, wait, that's a good point. Doh!).

An article by Nathan Mhyrvold in the WSJ also addresses the Ebay case, and inventors' rights. Excerpt:

The telling point in the troll debate comes if you look where tech companies pay big money for patents. It's not trolls, but rather small and completely legitimate patent holders -- the same ones that would be hurt by the "reform" proposals or the eBay case. As one observer puts it, Goliath is crying "Unfair! Take David's sling away!"

Excerpts from observations on the Ebay oral arguments from Hal Wegner:

Continue reading Supreme Court Roundup: Ebay . . .

posted by Solveig Singleton @ 8:21 AM | Big Tent , Biotech , Patents , Pharma , Prices , Software

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posted by Solveig Singleton @ 11:18 AM | International , Patents , Pharma , Prices

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posted by Solveig Singleton @ 4:22 PM | P2P , Prices

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