I'll be brief - I don't want to start a theoretical discussion. I simply want to point out a few things.
Nobody has really responded to my saying that labor used to create IP is scarce, other than to try to reduce it to a labor theory of value, which is not even true since the resulting product can be shown to be demanded (that means I give up $xx.xx in exchange) by a market economy. I'm not saying IP has ___ value, should be paid involuntarily, or even that our current IP law perfectly represents a market economy. It should simply be obvious, however, that a great bulk of IP is produced simply to create profitable market products.
There seems to be a growing prevalence for people to assume that absent the financial gains IP laborers receive for their work, nothing would change. This is pure stupidity. It is obvious that patent and copyright are abused, being granted for ideas that are fairly simple and could reasonably be stumbled upon by hobbyists or developed just for the resulting IP. However, the majority of IP does not fit these abused categories.
Most IP is developed by professionals and intended for mass consumers. Let me give you some examples: video games and Mac and Windows operating systems.
It seems to me in the anti-IP utopian fantasy this site has become dedicated to creating, that IP laborers will work just as hard under different business models which cannot produce a reliable expectation of income, if any. Also, the fantasy assumes IP laborers would create the same consumer-targeted products.
Looking at my examples, we have alternative OS's - specifically Linux. We even have at least one specific variant designed for mass consumer use - Ubuntu. These products are free to use. Every hardware vendor could save money installing it over Windows.
So why do Windows and Mac still rule the OS market? Because Mac and Windows are designed to be user friendly to the mass majority of computer users. Their software developers are hired specifically to do so. The developers are working for bread, not necessarily in the pursuit of what they consider a great product. They may even be using Linux workstations to do their work, ironically.
Compare this to Linux. One study says that Linux would have cost $1 billion to develop in a traditional proprietary environment. In other words, it has had lots and lots of man hours put into it? Why? The answer is obvious. Those who wanted Linux decided to communally work to make it. Thus, Linux is more an operating system for developers than it is mass consumers. Those who labor on Linux wish to have a better Linux, not more money. If they end up getting some money out of it, even better. However, the brunt of the direction of development is in the direction the developers want to consume. They don't want to compete directly with Windows market, because they don't want Windows.
Ok, so now someone please explain a few things to me. What business model would allow entrepreneurial investment to direct IP labor towards satisfying consumer demands, while guaranteeing as much or greater income than current business models that rely on IP law?
It seems anti-IP cannot answer this question. They can only point out abuses, or make far-fetched claims like that we'd simply stumble upon such information anyway or that the equivalent of the "new socialist man" would appear and work simply for others' benefit. They cannot tell me why division of labor would still be performed efficiently, even while forcing formerly pure IP developers into quasi-entrepreneurs, beggers, or part-time manual laborers.
Here's a simpler question to answer - why would I work year-round with 2 dozen people to produce a video game that will give me less than a week's work of entertainment, if not for the monetary gains derived from satisfying consumer demand, which are obviously larger if our product is allowed to be artificially scarce? It seems anti-IP would turn all video games into hobbyist mods of existing games.
Check my blog, if you're a loser
meambobbo:Here's a simpler question to answer - why would I work year-round with 2 dozen people to produce a video game that will give me less than a week's work of entertainment, if not for the monetary gains derived from satisfying consumer demand, which are obviously larger if our product is allowed to be artificially scarce?
You wouldn't.
meambobbo:It seems anti-IP would turn all video games into hobbyist mods of existing games.
It seems you insist that a world without IP would have the same products and demands it has now.
Maybe people wouldn't have video games. Maybe they would play badminton. Maybe they would drink more. Maybe they would read more.
Maybe there would be fewer games. Or more simpler games. Maybe the frameworks would be open source, and people would make their own games.
You're not going to be able to fit an IP world into a non-IP world. IP has totally distorted the market for creation and creativity. Things would be radically different.
a lot of video games could earn money from in-game advertisement. (car manufacturers in grand-theft auto etc.)
a lot of video games could make money from a subscriber model.
the basic economic force of trying to compete with your competitors for the markets of your material products will lead companies that arent taxed to hell to invest in R&D to reduce their costs relative to their competitors and increase their quality ahead of their competitors. This is an obvious motivating factor that would direct funds for intellectual pusuits in an economic fashion.
even if scrapping IP would reduce capital accumuklation and technical advancement (which i dont believe) surely the ethical/coercion of supporting bizarre claims to 'concepts' and 'patterns' is enough to damn it as a bad idea. Even if slaves could be more productive than freemen (which they arent) this wouldnt make slavery a defensible moral position.
Where there is no property there is no justice; a proposition as certain as any demonstration in Euclid
Fools! not to see that what they madly desire would be a calamity to them as no hands but their own could bring
meambobbo: Ok, so now someone please explain a few things to me. What business model would allow entrepreneurial investment to direct IP labor towards satisfying consumer demands, while guaranteeing as much or greater income than current business models that rely on IP law? It seems anti-IP cannot answer this question. They can only point out abuses, or make far-fetched claims like that we'd simply stumble upon such information anyway or that the equivalent of the "new socialist man" would appear and work simply for others' benefit. They cannot tell me why division of labor would still be performed efficiently, even while forcing formerly pure IP developers into quasi-entrepreneurs, beggers, or part-time manual laborers. Here's a simpler question to answer - why would I work year-round with 2 dozen people to produce a video game that will give me less than a week's work of entertainment, if not for the monetary gains derived from satisfying consumer demand, which are obviously larger if our product is allowed to be artificially scarce? It seems anti-IP would turn all video games into hobbyist mods of existing games.
It cannot answer it because it does not seek to guarantee anything. Remember, the entire point of what we talk about is to prevent monopolies and encourage liberty - not to provide system which will allocate goods and services; people can do that on their own.
You're assumption is that people only work for capital reimbursement - yet you proved earlier that linux is obviously the proof of the opposite. Which one do you actually believe?
Why would video game development as a hobby be bad? Your assumption that MOST IP is developed for mass consumers is also incorrect and backward. In reality consumers find the products that are good and fit a specific need and gravitate toward that, not the other way around.
Again, the key here is liberty - IP opposes that.
AndrewKemendo: the entire point of what we talk about is to prevent monopolies (and encourage liberty)
the entire point of what we talk about is to prevent monopolies (and encourage liberty)
Just a quick off topic point, in general I'd say I'm only against enforced monopolies like that of government on force, or like those the government grants. Where the free market throws up a monopoly (very rare, but theoretically possible), I would be "for" this, so long as all exchanges were voluntary, and it did not initiate aggression against potential new entrants to the market. If everyone began to hate coke, and love pepsi, I'd have no problem with even 100% of the world's cola consumption being of pepsi, so long as pepsi didn't try and use force to preserve its position (etc).
The difference between libertarianism and socialism is that libertarians will tolerate the existence of a socialist community, but socialists can't tolerate a libertarian community.
meambobbo:So why do Windows and Mac still rule the OS market?
Windows, because MS has a chokehold on the computer hardware industry. Mac... well, Mac's 8% market share isn't that much better than Linux's 2%, and both are demonstrably superior to Windows in almost every way. It has very little to do with actual market forces and a whole lot to do with the fact that Microsoft gets massive amounts of state privilege in the form of IP laws.
Also, your post doesn't consider alternative business models. For example, Canonical, the company backing Ubunutu, provides the OS for free and sells technical support. They make a lot of money doing this. The backers of several other big distros also do this. Things like pay-to-play games and premium web services are similar.
On a side note, just because something is available for free doesn't mean that there aren't advantages to buying it. If I see a new CD from a band that I like, I will generally buy, because of both the generally higher quality and the fact that I want to see that band's work rewarded.
Market anarchist, Linux geek, aspiring Perl hacker, and student of the neo-Aristotelians, the classical individualist anarchists, and the Austrian school.
Well, let's not forget, that prior to strong IP enforcement on digital products, Windows got all of it's initial momentum. If IP enforcement in the 80s was as it is today on digital goods, Windows might not have gotten off the ground.
Thedesolateone: Just a quick off topic point, in general I'd say I'm only against enforced monopolies like that of government on force, or like those the government grants. Where the free market throws up a monopoly (very rare, but theoretically possible), I would be "for" this, so long as all exchanges were voluntary, and it did not initiate aggression against potential new entrants to the market. If everyone began to hate coke, and love pepsi, I'd have no problem with even 100% of the world's cola consumption being of pepsi, so long as pepsi didn't try and use force to preserve its position (etc).
That's not a monopoly. A monopoly is a producing entity which determines the terms on which individuals have access to their product by coercively disallowing competition - not just simply having a better product.
What you speak of is a really kick ass product.
liberty student: Well, let's not forget, that prior to strong IP enforcement on digital products, Windows got all of it's initial momentum. If IP enforcement in the 80s was as it is today on digital goods, Windows might not have gotten off the ground.
True.
meambobbo:Nobody has really responded to my saying that labor used to create IP is scarce,
So what? IP laws distort rewards. People would still be rewarded for ideas without IP laws. No one has a monopoly on making tomatos. But they still do it, do they not? They just do not make as much producing tomatos as they would if they had a monopoly on it. IP proponents conveniently ignore the fact that people would still get rewarded for good ideas, they just would not get a distorted amount.
At most, I think only 5% of the adult population would need to stop cooperating to have real change.
AndrewKemendo: Thedesolateone: Just a quick off topic point, in general I'd say I'm only against enforced monopolies like that of government on force, or like those the government grants. Where the free market throws up a monopoly (very rare, but theoretically possible), I would be "for" this, so long as all exchanges were voluntary, and it did not initiate aggression against potential new entrants to the market. If everyone began to hate coke, and love pepsi, I'd have no problem with even 100% of the world's cola consumption being of pepsi, so long as pepsi didn't try and use force to preserve its position (etc). That's not a monopoly. A monopoly is a producing entity which determines the terms on which individuals have access to their product by coercively disallowing competition - not just simply having a better product. What you speak of is a really kick ass product.
Then we fully agree
Spideynw: So what? IP laws distort rewards. People would still be rewarded for ideas without IP laws. No one has a monopoly on making tomatos. But they still do it, do they not? They just do not make as much producing tomatos as they would if they had a monopoly on it. IP proponents conveniently ignore the fact that people would still get rewarded for good ideas, they just would not get a distorted amount.
Tomatoes do not become infinite goods after they are first discovered. Ideas, or digital products (like games, etc.) cost next to nothing to copy and distribute, thus there is a disconnect in the time before the product and after. Before the product, the game does not exist. The game must be designed and that design must then be executed, this requires time, labor, etc. Once the execution is completed the product can be reproduced infinitely. In this way, without some form of IP (free-market contract or some legal standing), there is no reward for the development of a digital product (or any other infinite good).
I want to stress the point that I am simplifying this scenario and treating the infinite good as the primary product sold by the developer or company and not some form of advertising or gimmick used to sell some other non-infinite good.
It is because of this I would argue that the development of infinite goods would greatly diminish in the absence of all IP.
I am writing this post in an attempt to remain value free in this analysis, thus I am not appealing to morality or some "correct" libertarian position. So, in fact, I am presenting a prediction.
JackSkylark: Tomatoes do not become infinite goods after they are first discovered. Ideas, or digital products (like games, etc.) cost next to nothing to copy and distribute, thus there is a disconnect in the time before the product and after.
Tomatoes do not become infinite goods after they are first discovered. Ideas, or digital products (like games, etc.) cost next to nothing to copy and distribute, thus there is a disconnect in the time before the product and after.
You misunderstand.
The ability to produce tomatoes, and the efficient ways of doing so become instantly infinite as soon as they are discovered; it is analogous. And indeed, it is a forceful argument; imagine if the arabs and egyptians had enforced IP - there would have been no population explosion etc, as only a few would have been allowed to use the new farming techniques - the idea of doing so was their intellectual property.
JackSkylark:Tomatoes do not become infinite goods after they are first discovered. Ideas, or digital products (like games, etc.) cost next to nothing to copy and distribute, thus there is a disconnect in the time before the product and after.
This is precisely why IP is not property.
JackSkylark:The game must be designed and that design must then be executed, this requires time, labor, etc.
Sure. But there are all kinds of activities that consume time and labour that might not find a buyer in the market (and thus have a value of $0).
JackSkylark: In this way, without some form of IP (free-market contract or some legal standing), there is no reward for the development of a digital product (or any other infinite good).
But surely the creation of numerous websites and digital products that are not "for commercial distribution" undermines this premise. Not to mention, you are defining profit very narrowly.
JackSkylark:It is because of this I would argue that the development of infinite goods would greatly diminish in the absence of all IP.
We already have open source goods being produced. In fact, more and more all of the time. IP on the other hand, just like any regulation, can only stifle the marketplace. So how one can argue that stifling the market increases it, seems counter-intuitive to me.
So what? ideas aren't scarce. You can dodge the issue and point out that your labour is scarce, but that misses the point. I can think of an idea, at the same time as you. And that's why you can't own an idea.
By the way, if I choose to take a really deep breath, that uses labour, it doesn't mean I own the air because of it.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
meambobbo is making a pseudo-LTV argument. I think I wrote on the Mises blog somewhere, people who argue for IP, have not completely accepted the subjective theory of value.
Strawman position and you lack understanding of the economics involved. Read the grand theory of infinte goods.
This have something to do more with momentum now. A suitable Linux OS should be usable for grandmas.
Nonsense. There are lot of developers working on it because they get paid to do it. The linux kernel project is quite possibly one of the largest commercial free software project on the planet.
Ok, so now someone please explain a few things to me. What business model would allow entrepreneurial investment to direct IP labor towards satisfying consumer demands, while guaranteeing as much or greater income than current business models that rely on IP law? It seems anti-IP cannot answer this question. They can only point out abuses, or make far-fetched claims like that we'd simply stumble upon such information anyway or that the equivalent of the "new socialist man" would appear and work simply for others' benefit. They cannot tell me why division of labor would still be performed efficiently, even while forcing formerly pure IP developers into quasi-entrepreneurs, beggers, or part-time manual laborers.
It seems anti-IP cannot answer this question. They can only point out abuses, or make far-fetched claims like that we'd simply stumble upon such information anyway or that the equivalent of the "new socialist man" would appear and work simply for others' benefit. They cannot tell me why division of
labor would still be performed efficiently, even while forcing formerly pure IP developers into quasi-entrepreneurs, beggers, or part-time manual laborers.
You sucks at thinking up business models. Look at techdirt and search through their archives for business models.
I already got 50 bucks for my first programming contract on video games. Without such copyright restriction on the game, I wouldn't be able to work on it.
All your concerns have been addressed by real world examples and emperical evidences. There are thousand of business models that could work but was not tried yet and there are probably thousand of examples.
http://libregamewiki.org - The world's only encyclopedia on free(as in freedom) gaming.
JackSkylark:Tomatoes do not become infinite goods after they are first discovered. Ideas, or digital products (like games, etc.) cost next to nothing to copy and distribute, thus there is a disconnect in the time before the product and after. Before the product, the game does not exist. The game must be designed and that design must then be executed, this requires time, labor, etc. Once the execution is completed the product can be reproduced infinitely. In this way, without some form of IP (free-market contract or some legal standing), there is no reward for the development of a digital product (or any other infinite good).
Of course there is, you are just denying reality. Console games cannot be downloaded. Granted, other companies would probably reproduce a good game that they did not invent, but they would probably add or change the content of the game to try and make it better. So you would have hundreds if not thousands of companies churning out better and better games. Companies would keep trying to make games better, rather than just trying to invent new games.
I find it hard to believe that having a legal backing to "I made this, make your own" stifles the market. Sure, go ahead and imitate, but direct copying I predict will drive down the time and labor spent in research and development, leading to a slowdown in innovation in anything that would now be an infinite good. I believe we would see a shift away from the technology sector into the material goods sector of the economy.
Spideynw: Of course there is, you are just denying reality. Console games cannot be downloaded. Granted, other companies would probably reproduce a good game that they did not invent, but they would probably add or change the content of the game to try and make it better. So you would have hundreds if not thousands of companies churning out better and better games. Companies would keep trying to make games better, rather than just trying to invent new games.
You moved away from the limits of the constructed arguments in your first two sentences. You say "console games can not be downloaded", and I say "I am only talking about goods that would become infinite in supply without IP." This is a very important assumption, which acts to overlook any company based copy protection.
Do you know why you go into a electronic store and buy a game for 50$? Because that is what a single company needs to sell their game in order to get a return on the investment they put into development of the product, also the are competing with various other games, etc... Anyways, putting out your game (without any form of IP, meaning your digital good enters into unlimited supply once it hits the market) would now, after a few purchases at 50$, be reduced to a market price of 0$ (once again assuming this is the primary good sold, so as to deflect the business model argument) -- Obviously, the investment put into the development of the product would not be repaid, and as such the company will most likely see no use in continuing any sort of development within a market which creates infinite goods.
Based on this, I don't see (in the absence of IP) much investment of either time or resources (outside of hobbyests, and people getting 50$ for messing with a game engine, i.e. people who really enjoy working in these areas) in the development of a good with an infinite supply. Perhaps this is a good thing, I'm not arguing that. I am only arguing what would happen to that area of the market.
another option, and probably a good counter example, would be company based copy protection (license keys, online registration, etc.). But I am excluding these examples for the sake of argument and will only be introduced if need be.
Once again, I am not saying this is good or bad, but rather what I believe would happen to the market for infinite goods, in the absence of any form of IP.
JackSkylark:I find it hard to believe that having a legal backing to "I made this, make your own" stifles the market.
You admit that the product of your labour is not scarce, and only IP can make it scarce, and thus retroactively add value to your labour.
meambobbo: Here's a simpler question to answer - why would I work year-round with 2 dozen people to produce a video game that will give me less than a week's work of entertainment, if not for the monetary gains derived from satisfying consumer demand, which are obviously larger if our product is allowed to be artificially scarce? It seems anti-IP would turn all video games into hobbyist mods of existing games.
Bzzzt wrong. There are many PC games made now where most of the fun is had through online games. You cannot get onto the servers without a key, which are all unique. World of Warcraft is a good example. People could copy it all day long and still not be able to get onto the server. Perhaps the incentive to create actual video game systems would go down, maybe it wouldnt. I suspect companies would adjust and find a workable solution without IP.
Music is another area that seems like it would be fine without IP. Musicians make most of their money through concerts anyway, scarcly much at all off IP related sales. In a free society, record contracts would probably be more akin to advertising contracts.
I'm going to try to reply to everyone at once. This might get sloppy. Thanks in advance for the thoughtful analysis already offered.
LS, I agree that a consequentialist approach is probably going to be very misleading. However, I would counter that the many arguing against IP are not interested simply in justice, but acquiring currently protected IP without legal hassles. In other words, many anti-IP proponents view this debate purely as consequentialist, without actually thinking through the long-term implications. In any case, I do agree with many of Kinsella and other's points about the justice aspect of IP. However, I think there are ways to reform IP law, rather than abolish it, that would better serve these just purposes without altering the desired consequences of our current system. I definitely believe that outright prohibition of market competition, free speech, and non-commercial flow of information is unjust while failing to produce positive consequences to the public as a whole, both in short-term and long-term time frames.
I tend to agree that justice is favorable to prosperity and that in the long-term for the most people the two are indistinguishable.
nirgrahamUK, this would indeed be an alternative business model. However, I'm not sure it can be profitable without being avoidable. What I mean by this is that consumers tolerate and even encourage advertisement to a certain extent, as it is either unnoticeable or enhances gameplay. But consider this. At equal market cost, would you choose the ad-free version of a program or the ad-full version? It's worthy to note that it may be more difficult to find an ad-free version as opposed to the ad-full, and this IS a cost. Then again, ad-free versions may become popularly found in common locations, such as torrent finding sites, actually reversing the situation.
It seems to me that such a model is less profitable than exclusive distribution/licensing, otherwise it would already be done. In some cases it is done, but are these an exception or a rule? Firefox indeed derives significant revenues from Google to use their website as the default website. This actually enhances Firefox, however. Who would prefer a version with no webpage, when it costs more in one's time to find this alternative? Such opportunities are not always available to software developers, however. Consider a program for a database, which can't readily display ads to consumers, or if it did would diminish its consumer value.
Furthermore, what is to stop a distributor from replacing the ads that funded the fixed cost of development, and replace it with their own, becoming a more profitable venture than the original? Of course, that is a cost in itself, and it is unlikely to find greater consumer demand than the original producer.
So, the question then becomes do first-arriver benefits trump fixed research and development costs, which competitors can simply disregard? In some areas, like car engines, this would seem to be "yes". For many forms of digital IP, especially software, I believe the answer is "no".
It seems these arguments all resolve to the same thing, which is "yeah, people could do that, and yea, it would be cheaper for them to obtain the IP in that manner, or the IP would be more valuable, but then they wouldn't be supporting the developers. if they want similar IP in the future, they need to voluntarily agree to support the developers financially in some manner."
This creates a gift economy. Let's look at the Austrian criticism of such on wikipedia:
Austrian economists argue that general prosperity in the modern economy depends on a highly elaborate and global division of knowledge and labor. Non-local division of labor in turn requires a market price mechanism based on transactions between strangers who, beyond prices and some other simple contractual terms, are generally ignorant of each other's needs. The "gift economy," on the other hand, depends on high degrees of reputation, trust, and mutual knowledge of those with whom one transacted. It is necessarily thus limited to a network of friends and relatives, a group no larger than the Dunbar number. According to their analysis, it would thus reduce the division of labor, and result in universal poverty in larger groups.
Next, a misinterpretation of what I was saying:
You're assumption is that people only work for capital reimbursement - yet you proved earlier that linux is obviously the proof of the opposite. Which one do you actually believe? Why would video game development as a hobby be bad? Your assumption that MOST IP is developed for mass consumers is also incorrect and backward. In reality consumers find the products that are good and fit a specific need and gravitate toward that, not the other way around.
I use Linux as an example of the prosumer model. Producers work for the end product, which is more quickly developed and developed with greater quality by allowing open collaboration. Indeed, allowing the free distribution of such works is beneficial to all involved. I don't think anyone could argue however that Linux was created to rival MS Windows as a user-friendly OS to the mass majority of computer users. The point here is division of labor. Should a brick layer who only desires a computer for porn have to learn a crap-load of technical computer knowledge to do so? No, he is enhanced by commercial products aimed at him. In turn, he provides those who make these products his market service.
Development is not as big a gift economy as people assume. Developers rarely develop programs that they don't really need or desire simply to satisfy the desires of others. Prosumption is different from gift production.
Similarly, I would love for their to be an "open engine" that could compete with the Unreal Engine or Source for hobbyists, or even professional developers to use to more quickly and in more quantity produce video games. I'd love a greater variety of hobbyist-created games. However, if the absence of IP law prevents professional developers from being rewarded for creating innovative games, there will actually be less, not more of them; and if this is my interest, it is NOT in my interest to get rid of IP law.
I am not anti-open source/free software. Yet these things exist inside copyright law. I think copy-center is the best licensing method. It enhances both commercial and non-commercial products. Mac, Windows, and Linux all use BSD networking code, as far as I know.
And I don't think the view that most IP isn't purposefully geared toward consumers is wrong. Films, books, software, video games, etc. are generally commercially produced to satisfy consumer demand. Even open-source projects like Firefox follow this model. They may not generate their income from licensing usage, but their model is based around selling something to consumers. For Firefox, it's google ads. For Apache, it's commercial licensing. The only notable exception to this I find is prosumption, which includes a lot of art.
wombatron, MS does not have a grip on the hardware market. If it does, it is the result of voluntary contract, not government coercion. It may engineer contracts that are overly exclusive and designed to harm their competitors, but it can't force vendors to sign them. If there were an OS preferred by the market, MS would have NO grip on the hardware market. IP law can't claim to be at fault here. Given that Wal-mart offered PC's with Ubuntu pre-loaded is case in point. All OS producers are subject to the same IP laws. And as Torvalds has said, most patents on OS fundamentals were created in the 60's and have expired. Any copyright violation is likely incorrect and could be quickly recoded for compliance. It is not simply IP law creating MS dominance, but consumer preference. As for demonstrably showing Linux is better, show it to a 10 year Windows user who knows next to nothing about computers. The time to learn a new OS is indeed a cost. I'd agree it's better to me and you, but not the mass market.
As far as the alternative business model of support services, this isn't necessarily available on all types of IP. How would you sell support services for a simple child's video game that his/her parent would normally buy for them? A help hotline? Advertisements? These are most likely ineffective revenue generators. I agree that alternative business models are a good thing, and that IP law is currently too strict and too abused. However, these alternative business models and open licensing agreements are available inside a world with IP law. That they are not already prevalent throughout all IP industry suggests they are not always competitive or even viable.
As far as buying when you could avoid buying, this is a pure and simple gift economy. See the above criticism our school poses on this.
As far as tomatoes vs. IP, the differences are clearly obvious. The market prices for the resulting products have nothing to do with the labor required to create them, but the forces of supply and demand. Any free rider "problems", such as a boost in sales for one producer from many other producers' collaborating to encourage tomato consumption through general advertisement, do not effect the market fundamentals and can be dealt with without government force.
In IP, this is different. The marginal cost of reproducing the IP is virtually 0 compared to the fixed costs of development. Free riders would drive fixed costs down sharply. Thus, the only surviving IP products designed for consumers would be ones that could be produced cheaply or are already produced through prosumption. It essentially tells those who enjoy current consumer IP products that they need to support such industries through charity. We are back at the gift economy.
Please don't interpret my mentioning of the free rider "problem" as an indication that I support public choice theory. I do not.
I can think of an idea, at the same time as you.
I would agree that such ideas shouldn't be subject to IP law. I doubt, however, that anyone could write the same novel as me, beyond a few basic themes and characters and plot interactions. I doubt two different people can write a song with the same structure, melodies, harmonies, timbre, and rhythm at the same time. A melody here or a chord progression there is quite understandable. Same verse/chorus structure with the same melody/harmony/rhthym - infintesimely doubtful. IP law already takes this into account. Juries can easily tell if one work was copied beyond a reasonable doubt from another, rather than freely and independtly created.
...Finally, there are the collective consumer purchase agreements, which you can find if you google "code bounty". These are proven inefficient mechanisms. They require consumer labor, risk, and expectations of reward, things traditionally handled by entrepreneurial middle men.
And I definitely don't have a pseudo-LTV view. Value is surely subjective and imputed by the market. I'm not for prohibition of market restriction. I do feel that commercial providers of IP should be forced to give some of their revenue to the copyright holders, and that this portion should decrease over time until it hits 0%.
STOP WRITING WALL OF TEXTS PLEASE!
meambobbo: I'm going to try to reply to everyone at once. This might get sloppy. Thanks in advance for the thoughtful analysis already offered. LS, I agree that a consequentialist approach is probably going to be very misleading. However, I would counter that the many arguing against IP are not interested simply in justice, but acquiring currently protected IP without legal hassles. In other words, many anti-IP proponents view this debate purely as consequentialist, without actually thinking through the long-term implications. In any case, I do agree with many of Kinsella and other's points about the justice aspect of IP. However, I think there are ways to reform IP law, rather than abolish it, that would better serve these just purposes without altering the desired consequences of our current system. I definitely believe that outright prohibition of market competition, free speech, and non-commercial flow of information is unjust while failing to produce positive consequences to the public as a whole, both in short-term and long-term time frames. I tend to agree that justice is favorable to prosperity and that in the long-term for the most people the two are indistinguishable.
Copyright law is completely abritiary. How long should the term last? What count as fair use and what count as commercial use(HINT: It is very blurry)?
nirgrahamUK, this would indeed be an alternative business model. However, I'm not sure it can be profitable without being avoidable. What I mean by this is that consumers tolerate and even encourage advertisement to a certain extent, as it is either unnoticeable or enhances gameplay. But consider this. At equal market cost, would you choose the ad-free version of a program or the ad-full version? It's worthy to note that it may be more difficult to find an ad-free version as opposed to the ad-full, and this IS a cost. Then again, ad-free versions may become popularly found in common locations, such as torrent finding sites, actually reversing the situation. It seems to me that such a model is less profitable than exclusive distribution/licensing, otherwise it would already be done. In some cases it is done, but are these an exception or a rule? Firefox indeed derives significant revenues from Google to use their website as the default website. This actually enhances Firefox, however. Who would prefer a version with no webpage, when it costs more in one's time to find this alternative? Such opportunities are not always available to software developers, however. Consider a program for a database, which can't readily display ads to consumers, or if it did would diminish its consumer value. Furthermore, what is to stop a distributor from replacing the ads that funded the fixed cost of development, and replace it with their own, becoming a more profitable venture than the original? Of course, that is a cost in itself, and it is unlikely to find greater consumer demand than the original producer.
How many website have ads? Tons of them and yet they still exists. If that is the case, the free market will forced to adapt a new business models to fit consumer wants.
Absolute nonsense. The high cost of innovation is inherient in every field. It takes time to write good software.
It is called "work for hire".
(delete stuff about gift economy)
Next, a misinterpretation of what I was saying: You're assumption is that people only work for capital reimbursement - yet you proved earlier that linux is obviously the proof of the opposite. Which one do you actually believe? Why would video game development as a hobby be bad? Your assumption that MOST IP is developed for mass consumers is also incorrect and backward. In reality consumers find the products that are good and fit a specific need and gravitate toward that, not the other way around. I use Linux as an example of the prosumer model. Producers work for the end product, which is more quickly developed and developed with greater quality by allowing open collaboration. Indeed, allowing the free distribution of such works is beneficial to all involved. I don't think anyone could argue however that Linux was created to rival MS Windows as a user-friendly OS to the mass majority of computer users. The point here is division of labor. Should a brick layer who only desires a computer for porn have to learn a crap-load of technical computer knowledge to do so? No, he is enhanced by commercial products aimed at him. In turn, he provides those who make these products his market service.
The linux world have lot of division of labors. Tons of text editors, video games, browsers, two rivial desktop environments, and different distro that serve different needs and users.
You completely ignored the commercial aspect of free software.
This is more of a business problem. I am working on that area and I already got my first programming contract.
What the hell are you smoking? The best software are the most free one(in both cost and freedom) and yet rivial proprietary applications.
(Delete craps)
Nonsense. Just because the proprietary business model is the dominant business model doesn't mean it is the best. The enterprise linux world didn't get built in a single day and RedHat doesn't start out as a big fish.
As far as buying when you could avoid buying, this is a pure and simple gift economy. See the above criticism our school poses on this. As far as tomatoes vs. IP, the differences are clearly obvious. The market prices for the resulting products have nothing to do with the labor required to create them, but the forces of supply and demand. Any free rider "problems", such as a boost in sales for one producer from many other producers' collaborating to encourage tomato consumption through general advertisement, do not effect the market fundamentals and can be dealt with without government force. In IP, this is different. The marginal cost of reproducing the IP is virtually 0 compared to the fixed costs of development. Free riders would drive fixed costs down sharply. Thus, the only surviving IP products designed for consumers would be ones that could be produced cheaply or are already produced through prosumption. It essentially tells those who enjoy current consumer IP products that they need to support such industries through charity. We are back at the gift economy.
BS. Did you read ANY of my techdirt links? It shows lot of examples.
Please don't interpret my mentioning of the free rider "problem" as an indication that I support public choice theory. I do not. I can think of an idea, at the same time as you. I would agree that such ideas shouldn't be subject to IP law. I doubt, however, that anyone could write the same novel as me, beyond a few basic themes and characters and plot interactions. I doubt two different people can write a song with the same structure, melodies, harmonies, timbre, and rhythm at the same time. A melody here or a chord progression there is quite understandable. Same verse/chorus structure with the same melody/harmony/rhthym - infintesimely doubtful. IP law already takes this into account. Juries can easily tell if one work was copied beyond a reasonable doubt from another, rather than freely and independtly created. ...Finally, there are the collective consumer purchase agreements, which you can find if you google "code bounty". These are proven inefficient mechanisms. They require consumer labor, risk, and expectations of reward, things traditionally handled by entrepreneurial middle men. And I definitely don't have a pseudo-LTV view. Value is surely subjective and imputed by the market. I'm not for prohibition of market restriction. I do feel that commercial providers of IP should be forced to give some of their revenue to the copyright holders, and that this portion should decrease over time until it hits 0%.
We don't need IP laws to separate liars from real authors. The market already does that just fine.
For example, techdirt get copied by people all the time, but techdirt's aren't dropping anyway. The bloggers there didn't attempt to go out that sue everybody who did.
Also, copying is human nature. Are you suggesting we ban something that we can't help do?
sicsempertyrannis,
your example is not entirely accurate, but it is indeed a good one. potentially, i can create my own host server with a less expensive key than the official Blizzard ones. i could possibly reverse engineer their server software, even if it was not made public. all that would be required is for someone to hack the game and change the networking code to work with any user-specified host. of course, in this example, blizzard would have a strong first-arriver advantage. and if their prices were fair, it may simply be unprofitable for a venture to spend the time and labor doing the reverse engineering and setting up their own host.
of course, this only applies to a small segment of IP. look at the amount of software that requires validation through the internet that has had such safeguards cracked. In a world without IP law, distributors could advertise and host these versions publicly...in any country.
in addition to performances, musicians make a good bit of money off of merchandising. without IP law, any merchant could offer their own merchandising. while that doesn't eliminate the musicians' own sales, it could be seen as cutting into them. so musicians would make even less money.
it seems to me that IP law is not the reason why most musicians are borderline broke. it's simply that there are scores and scores of them. hell, i'm one, although i think it would be arrogant to offer my art as a commercial product. On the other end of the spectrum, there are few "middle class" musicians, who enjoy relative affluence but are not pushed hard by corporate advertisement/events, especially involving the media. Of course, this might be due more to our non-free market media and corporate tax/regulatory structure.
but the real question is this - what would happen to film score composers - those whose product is completely reproducible information, not tied to scarce goods and services that only they can authentically provide?
meambobbo: so musicians would make even less money.
One can only hope.
meambobbo: but the real question is this - what would happen to film score composers - those whose product is completely reproducible information, not tied to scarce goods and services that only they can authentically provide?
Simple. Their fucking labor and writing ability.
JackSkylark:ou moved away from the limits of the constructed arguments in your first two sentences. You say "console games can not be downloaded", and I say "I am only talking about goods that would become infinite in supply without IP." This is a very important assumption, which acts to overlook any company based copy protection.
But at the end of your statement you referred to video games. But computer games are not the only video games. And have you seen the supply of "good" computer games recently? It is next to nill.
JackSkylark:Do you know why you go into a electronic store and buy a game for 50$? Because that is what a single company needs to sell their game in order to get a return on the investment they put into development of the product,
Because copyrights and patents limit research, causing the cost of producing a game to go way up.
JackSkylark:Anyways, putting out your game (without any form of IP, meaning your digital good enters into unlimited supply once it hits the market) would now, after a few purchases at 50$, be reduced to a market price of 0$
Not necessarily. First of all, there is still the cost of the disc and storage. If you are referring to downloads, computer game makers can protect their products like Blizzard and Valve do.
JackSkylark:Obviously, the investment put into the development of the product would not be repaid, and as such the company will most likely see no use in continuing any sort of development within a market which creates infinite goods.
Except that development costs would drop dramatically, since companies would not have to create a whole new set of code for each game.
Kiba, would you prefer a dozen individual responses? In my mind it makes no difference. Plus you don't need to quote my arguments at length if you want to keep posts small.
I agree that what i described for copyright is arbitrary. I don't think this is a terrible flaw, so long as its juries and not regulatory agencies that get to be arbitrary. it seems clear that those who simply host direct copies of copyrighted works for commercial profit would owe some of their commercial profit to the copyright holder. trying to argue against an idea by exposing a portion of a copyrighted work seems like fair use to me. everything in between is gray. maybe juries could also determine what is owed without bounds, rather than enforcing the pointless range of fines that the government forcefully ascribes. as far as length, it seems 10 or 20 years is quite long, in regard to any form of IP. Limitless copyright lifespans attached to corporations are a terribly backward idea.
Good argument with the adverts on websites. I agree, especially when site content is regularly updated. See more on this towards the end, after the "..."
I address the "work for hire" argument. Without entrepreneurs between laborers and consumers, the production process becomes inefficient. There are already dozens of "code bounty" sites and few of them produce any end result. This does not apply to a small group of consumers desiring specific software, which does operate pretty well. This is for mass-consumption products.
I do not ignore commercial aspects of free software. I say that they rely on advertising other tangible services. There are types of software that could not benefit from such.
I look forwards to hearing more about your project. Please don't label me as an enemy.
Free software is most free when it is copy-center licensed. This allows it to be freely used in proprietary and non-proprietary software. Copy-center and copy-left are simple licensing techniques based upon copyright. Why are we confused here? I use both proprietary and free software. Oh, and you know what libertarians smoke; don't pretend it makes me a moron.
If my example is incorrect, show me why. It is a very specific example - young children's video games. Enterprise Linux is something different entirely. As I say, the business model works in some areas, but completely fails in others.
I have not yet read the techdirt examples, but I am going to. I'll let you know what I think of them. I promise I'll read them before responding to you again.
I agree about the market preferring the truthful to the liars, but the market also prefers the less expensive. There is likely a cutoff.
We could also argue violence is in human nature. Or receiving satisfaction at the least cost possible. And combined, these things mean crime is in human nature. Doesn't make it right. I am not arguing that copying is inherently wrong. It seems that when you copy to purposefully attempt to undermine someone's ability to earn income off his work, it is wrong.
...
Thinking about this - video game developers would not necessarily be out of a job without IP law. They could receive substantial revenue from web advertising, so long as they broke their distributions up into many discrete parts, with new levels, etc (possibly even developed "for free" by prosumer fans), that kept them returning for more and more. This would guarantee them the first arriver benefit and extend their revenue for a product over a long period.
I am willing to admit that I am completely wrong about all this (this usually happens when I argue with LS). Business models would definitely adapt. It just seems to me that part of it would be a gift economy, which is not necessarily bad. One of the prime arguments against a gift economy is that people could not remember beyond a certain number of people who was productive and who was a mooch. With the free flow of digital information, this may be easier to maintain. Mooches could not be entirely excluded, but they could be cut off from first access to relevant information, which alternative providers would not pay money to reproduce as their market would be made of mooches that generally do not contribute.
Finally, this argument might not even matter in the near future. It is becoming more and more difficult to enforce IP law. Without a totalitarian NWO, I think we're safe to say that the only difference will be whether we have a white free market or a black one.
Kiba, techdirt is a helpful analysis of alternative IP business models, proving them more powerful than they may first appear. I like the site, and will continue to view it.
That being said, it's main supported business model is "give away reproducible information for free to increase market share while offering scarce goods and services related to the information".
This is not new news to me. In fact, I think it is the best business model one can make with many forms of info. However, it seems some forms of information would still prefer pay-per-user licenses as a revenue model.
I don't see why both can't exist, so long as IP law was reformed to prevent common abuses that border on the prohibition of free speech.
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My assumption is with a good entering a market and instantly having an unlimited supply, thus we cannot bring into the discussion any form of individual (company created) copy protection (i.e. license keys and the like), as this is a look at entering a market with a good of unlimited supply. Secondly you violate the subjective value theory in trying to put a positive valuing to computer games.
But as to why I am posting, I assert that anyone who is in complete disregard of IP is just as detrimental to liberty as a communist. In fact I can not see why any of you would spend so much time on a site whose name you do not even agree with. The arguments put forth by the majority here have taken a complete reversal of the Austrian tradition and as such you do a disservice to those names you invoke.
"Yet there is an exception to this general rule that monopoly prices benefit the seller and harm the buyer and infringe the supremacy of the consumers' interests. If on a competitive market one of the complementary factors, namely F, needed for the production of the consumer's good G, does not attain any price at all, although the production of F requires various expenditures and consumers are ready to pay for the consumers' good G a price which makes its production profitable on a competitive market, the monopoly price for F becomes a necessary requirement for the production of g. It is this idea that advance in favor of patent and copyright legislation. If inventors and authors were not in a position to make money by inventing and writing, they would be prevented from devoting their time to these activities and from defraying the costs involved. The public would not derive any advantage from the absence of monopoly prices for F. It would on the contrary, miss the satisfaction it could derive from the acquisition of G." - Ludwig von Mises, Human Action Pg. 383 (he reiterates these sentaments on pg. 676-677)
Also refer to pages 657-658, where Mises examines the "external economies of Intellectual Creation" (Mises presents the same argument I have thus far)
Or, let us look at Rothbard:
“It is true that a patent and a copyright are both exclusive property rights and it is also true that they are both property rights in innovations… Let us consider copyright. A man writes a book or composes music. When he publishes the book or sheet of music he imprints on the first page the word “copyright”. This indicates that any man who agrees to purchase this product also agrees as part of the exchange not to recopy or reproduce this work for sale. In other words, the author does not sell his property outright to the buyer; he sells on condition that the buyer not reproduce it for sale… any infringement of the contract by him or a subsequent buyer is implicit theft and would be treated accordingly on the free market. The copyright is therefore a logical device of property right on the free market.” - Murray N. Rothbard, “Man, Economy, and State” Pg. 747
Also, refer to the many footnotes from pages 673, 746-748, in which he goes on to say that designs can, and should be, copyrighted on the free market.
How about Rand (who though not an Austrian, is commonly referenced here):
“What the patent and copyright laws acknowledge is the paramount role of mental effort in the production of material values; these laws protect the mind’s contribution in its purest form: the origination of an idea. The subject of patents and copyrights is intellectual property.
An idea as such cannot be protected until it has been given a material form. An invention has to be embodied in a physical model before it can be patented; a story has to be written or printed. But what the patent or copyright protects is not the physical object as such, but the idea which it embodies. By forbidding an unauthorized reproduction of the object, the law declares, in effect, that the physical labor of copying is not the source of the object’s value, that that value is created by the originator of the idea and may not be used without his consent; thus the law establishes the property right of a mind to that which it has brought into existence….
The government does not “grant” a patent or copyright, in the sense of a gift, privilege, or favor; the government merely secures it—i.e., the government certifies the origination of an idea and protects its owner’s exclusive right of use and disposal.”
-Ayn Rand, “Capitalism: The Unknown Ideal”
I could go on and on, from Hayek to Kirzner and back. Now, I am tired of writing... but if anyone needs anymore evidence I suggest you re-read some of these sources.
JackSkylark:If on a competitive market one of the complementary factors, namely F, needed for the production of the consumer's good G, does not attain any price at all, although the production of F requires various expenditures and consumers are ready to pay for the consumers' good G a price which makes its production profitable on a competitive market, the monopoly price for F becomes a necessary requirement for the production of g
Our critics would respond that a monopoly price for F is not a necessary requirement for the profitable production of G. In other words, the created info or IP does not need a monopoly for its funder to make a profit off of the consumer goods that use/result from it.
I would respond that counter-examples do not make the rule, although they are indeed becoming more numerous. I stick by my argument - that the fundamental problem with IP law is not its premise but its abuses, which create moral problems, and that IP law still allows information to be licensed as though there were no IP law, through copy-left and copy-center licensing. Thus, we can both have our cake and eat it too, without telling IP creators they are immoral for attempting to monopolize the revenue of their products.
Maybe the largest problem is the inflating costs of legal troubles.
anti-ip libertarianism = SOCIALISM
Copy Left is not synonymous with CC 3.0 Attrib or Public Domain.
Copy Left is still IP, as is even CC 3.0.
Utilitarian arguments fail, not that they were particularly strong anyway. Moral/emotive arguments also fail, for obvious reasons.
What does not fail (IMHO) is a rational analysis of whether or not IP is property. And if it is, then certain forms of property rights apply. And if it is not, then they do not. Utilitarian and Emotive/Moral arguments notwithstanding.
engine44:anti-ip libertarianism = SOCIALISM
How so?
I wish someone would make a real case for how IP conforms to any definition of property. As far as I am concerned, property has to be scarce or unique. IP is neither. It is merely the product of time and energy. Which if that was our only definition of property we would not be Austrians as we would subscribe to a time theory or labour theory of value instead of a subjective theory of value.
IP is actually a form of fascism, in that it cannot exist outside of a state monoply of law.
meambobbo: Our critics would respond that a monopoly price for F is not a necessary requirement for the profitable production of G. In other words, the created info or IP does not need a monopoly for its funder to make a profit off of the consumer goods that use/result from it. I would respond that counter-examples do not make the rule, although they are indeed becoming more numerous. I stick by my argument - that the fundamental problem with IP law is not its premise but its abuses, which create moral problems, and that IP law still allows information to be licensed as though there were no IP law, through copy-left and copy-center licensing. Thus, we can both have our cake and eat it too, without telling IP creators they are immoral for attempting to monopolize the revenue of their products. Maybe the largest problem is the inflating costs of legal troubles.
Counter examples are so numerous that it cannot be anything else other than the rules. The problem of IP is only an entrepreneurial problem. Keep in mind that just because in certain sectors of an industry, free software do not dominate doesn't mean that there isn't a viable business models that exist. It might be due to other factors.
Such example is FOSS games, which is what I specialize my entrepreneurlship activity in. From my experience and discussion with gamers, I knew that gamers in these niche are probably willing customers who are willing to fund the development of games or is willing to buy ancillaries. The only problem is that there is no entrepenurial pool and the entrepneurs that exist are too unrealistic in their guess(Too big a target for funding, etc). Though I notes that one entrepneur was able to recevie money over a period of several month approaching his target. Unfortunately his effort was derailed by outside influences. I only been able to enter the arena through my first programming contract, which will reward me with a small amount of money. It was a culimination from months of writing games for free over the past two years.
However, these ulitiarian reasoning and practical application of economics are not the fundamental thesis for my opposition to IP. I relies on normative ethic for that. I refer to Kinsella's excellent book Against Intellectual Property and Liberty Student's statement .
liberty student:I wish someone would make a real case for how IP conforms to any definition of property
Property really isn't the important issue. I will freely admit that information cannot be property. I was thoroughly impressed by Kinsella's arguments and look forward to reading Against Intellectual Monopoly.
The violation of freely formed contracts is the moral issue. Anti-IP law arguments fundamentally say that it is immoral to enforce contracts that both parties freely accept. I don't consider this immoral. I consider refusal to honor contracts immoral.
I went back to Kinsella's book to look at how he addressed this issue. He agrees. His theoretical argument is purely against copyright law. He merely mentions that contracts would most likely be consequentially ineffective.
This is a better question. It seems like any serial number, watermark, etc. linking an illegally shared piece of copyrighted material can be quite easily removed or muddled to conceal identities. Copyright holders serious about protecting their market under such a business model should be concentrating on non-cumbersome technologies that allow them to track down the serious criminals rather than small-time file sharers.
Thinking more about this...
It seems that those who end up with a copy of information that was only released under a contract not to reproduce could claim that they received it from a source who did not include this contract. But then they would be compelled to reveal their source, or face obstruction of justice charges. In this way, there would be an attempt to root out contract violators who are re-distributing for commerical purposes.
meambobbo:But then they would be compelled to reveal their source, or face obstruction of justice charges.
why not put the onus on the prosecution to prove their case. you know, innocent till proven guilty and whatn0t
Love how everyone ignores JackSkyLark's references to the founders of austrian economics.. but that's beside my point.
liberty student:IP is actually a form of fascism, in that it cannot exist outside of a state monoply of law.
Current IP laws are a form of fascism, sure. IP, not so much.
liberty student:I wish someone would make a real case for how IP conforms to any definition of property. As far as I am concerned, property has to be scarce or unique. IP is neither. It is merely the product of time and energy. Which if that was our only definition of property we would not be Austrians as we would subscribe to a time theory or labour theory of value instead of a subjective theory of value.
Unique code is not scarce? The exact order of thousands of letters to form words and tell a story is not scarce? I'd say they are. Granted, IP is so overblown it's laughable right now, but basic IP/copyright laws should exist. But by claiming that the sentences I write here, or the book I write in my spare time is not unique, and claiming that you're able to reproduce it without my approval, means you are taking the labor of my mind. My mind and its creations are unique and scarce. You're claiming ownership of anything that comes out of my mind and manifests itself physically, because you could have the same idea at some point independently. My argument would be that logically, I could build that car/toaster/other item you consider property on my own and independently, thus I have just claim to it. You'll say this doesnt apply because I am comparing 'non-property' to 'property' in your view, and by rejecting my view you claim to invalidate it. Perhaps someday this will fly as a logical argument. But my contention is that no one will produce in this society. Don't say the market will find a way. That's a coward's way of avoiding having to actually make an argument. Why would anyone go into software production or music/book publishing (the only industries I'm talking about) when they are assured no profit? They would not. Want to cripple the market, just tell people they cannot keep the profit produced by their creations. Sure, some people will do it for the public good. Marx would be oh so proud of them. Sorry, but this is socialism. Some sort of compromise would need to be enacted, else your society will exist in a static environment without any innovation. Summation: my mind is unique and scarce, just as your labor is. The market puts value on my mind. Thus the product of my mind has value, and should be considered property, just as the product of your labor is considered scarce, and is thus property.