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  • aaeru1 6:25 am on June 19, 2013 Permalink | Reply
    Tags: , Profit without Copyright   

    Profit without Copyright: “Copies have been devalued. There’s so much of it it’s like confetti.” 

    The issue with piracy is really an issue of entrepreneurs insisting that they use a business model of printing and selling copies (that have been devalued) and not understanding why their copies arent worth as much as they think it does.

    Whereas in the 20th century, printing copies required giant printing press which costs hundreds of thousands (if not millions) in investment capital. in the 21st century, the commoner can buy one for several hundred. So there was a paradigm shift. For something like $300 and a $20 monthly internet connection, u can rival the output of a factory from 20 years ago.
    What happens when every household can produce as much as what costed millions to produce a decade ago? It creates an abundance.
    Because basic economics tells us that prices tend towards marginal costs. The marginal costs for producing a copy is now $0.00001, so cheap, that people are willing to produce it for free. That’s why it is free, not because people stole it, but because competing printers bid each other down repeatedly until the price of it hits rock bottom.

    There’s so much of it it’s like confetti.

    The problem is that entrepreneurs are stuck in the 20th century business model, they want to sell confetti but they don’t understand why consumers don’t want to buy that anymore. Therefore, the fix to the problem is simply to produce things that haven’t been devalued yet. Like your labour. The act of creating a new movie or a new video game is always going to be scarce, because I cannot pirate a movie into existence. I have to offer to pay the artist to motivate him/her to exchange his or her services in creating new movies.

    That is why you are seeing in post-netflix world, a market that is mass-emigrating over to this model of production. Just the other day we saw crowd funding exceed $10 million http://www.polygon.com/2013/6/10/4410436/chris-roberts-celebrates-star-citizens-10-million-crowdfund
    In 2012, kickstarter, just one private player alone, has facilitated for more funding to the arts than the entire National Endowment of the Arts!

    Of course, I’m not saying the first hundred copies that the artist sells is not extremely valuable. But once it is sold into the world, there is no enforcement ability capable of preventing purchasers from manufacturing more copies for their friends & neighbours (short of a totalitarian police state).

    That is why even in the absence of scarcity of copies, you can still make money. Just because the copies have been devalued, it does not mean that there is no business model.
    Apart from selling your labour, you can also sell:

    • Immediacy (i want it in my folder here as soon as it comes out. I will pay $3).
    • Personalization (i want u to record a brand new version of this track just for me)
    • Support (i want 24/7 support for this piece of software. I want online play.)
    • Accessibility (i want it on all my platforms. i want it on smartphone)
    • Convenience (i dont want to fiddle with file transfer. u do that for me)
    • Embodiment (i want a boxed copy. i want it to line my shelf)
    • Generosity (i want it bcuz u are so generous. i like how u sold me $400 worth of games for $25)
    • Attention (https://sharingisliberty.wordpress.com/2012/07/30/attention-economy/)
    • Patronage (i want to pay you. i like how 95% of my money goes to u)
    • Transparency (i like how u tell me how much u make, other sellers dont tell me this, aka humble bundle)

    ^ None of these things can be pirated.

  • R 6:54 pm on February 19, 2013 Permalink | Reply
    Tags: Profit without Copyright   

    As soon as one scarcity finishes, it opens up the door to every other scarcity that surrounds the one that has now been fulfilled. (that were previously out of reach) 

    Your argument is ‘right’ and ‘deserve’.
    No one has a ‘right’ to make a living. That means even if they create our beloved arts. If you create video games for a living, you are a video games entrepreneur. It is your job to find a model to monetize your creations in the way/i> that the customer wants it, not in the way that you want to serve it. But serving them is not enough. You must serve them in a way that they will be willing to pay. Society doesn’t bend itself backwards for you. If you want my money, you serve me in a way that I will be willing to accept your services for a reasonable sum of money. There is no coercion. This is how the human empire was built.

    In post-netflix world, as soon as you have sold to your customer, they compete against you. That is because advances in information-reproduction has made the industrial activity of reproducing information so infinitesimally cheap. Everyone can run a printshop for the price of a computer and an internet.
    Do you know what happens when almost every person in the country runs a printing press that previously needed Hundreds of thousands of dollars to build? It creates an abundance. There is no scarcity or market demand left for the industrial activity of information-reproduction anymore. In fact it makes no sense to try and sell information-reproduction. Even if I charge $5, the bloke down the street with his printing press will do it for free. It means the market price for information-reproduction has been reduced to zero dollars (that is because price of goods tend towards marginal costs given enough time). It means if I sell it, I will probably not succeed. I will probably be outcompeted.

    But fortunately human desires never end. They never end. They always desire something.

    As soon as one scarcity finishes, it opens up the door to every other scarcity that surrounds the one that has now been fulfilled. (that were previously out of reach). I have listed some examples of scarcities that are still in demand.

    There is also:

    • Immediacy (i want it in my folder here as soon as it comes out. I will pay $3).
    • Personalization (i want u to record a brand new version of this track just for me)
    • Support (i want 24/7 support for this piece of software. I want online play.)
    • Accessibility (i want it on all my platforms. i want it on smartphone)
    • Embodiment (i want a boxed copy. i want it to line my shelf)
    • Generosity (i want it bcuz u are so generous. i like how u sold me $400 worth of games for $25)
    • Attention (https://sharingisliberty.wordpress.com/2012/07/30/attention-economy/)

    But also:

    • Patronage (i want to pay you. i like how 95% of my money goes to u)
    • Transparency (same as above. i like how u tell me how much u make)

    ^ What if I don’t want to sell any of those? What if I can’t afford to sell any of these?
    The solution is to sell your labour. Because the creation of new arts is necessarily a scarcity. You are giving birth to a piece that previously did not exist in the world. So long as fans desire your work, it will always be a scarcity in the sense that you cannot pirate it.

    Readers don’t expect you to work for free, but they expect to be free to share and build upon the work after they have paid you to write it.

    Quote from John Gilmore co-founder of EFF.org
    “What is wrong is that we have invented the technology to eliminate scarcity, but we are deliberately throwing it away to benefit those who profit from scarcity. We now have the means to duplicate any kind of information that can be compactly represented in digital media. We can replicate it worldwide, to billions of people, for very low costs, affordable by individuals. We are working hard on technologies that will permit other sorts of resources to be duplicated this easily, including arbitrary physical objects (“nanotechnology”; see http://www.foresight.org). The progress of science, technology, and free markets have produced an end to many kinds of scarcity. A hundred years ago, more than 99% of Americans were still using outhouses, and one out of every ten children died in infancy. Now even the poorest Americans have cars, television, telephones, heat, clean water, sanitary sewers — things that the richest millionaires of 1900 could not buy. These technologies promise an end to physical want in the near future. “We should be rejoicing in mutually creating a heaven on earth!” Instead, those crabbed souls who make their living from perpetuating scarcity are sneaking around, convincing co-conspirators to chain our cheap duplication technology so that it won’t make copies — at least not of the kind of goods they want to sell us. This is the worst sort of economic protectionism — beggaring your own society for the benefit of an inefficient local industry. The record and movie distribution companies are careful not to point this out to us, but that is what is happening.”

  • R 9:37 am on February 15, 2013 Permalink | Reply
    Tags: , Profit without Copyright   

    How to make a living as a video games entrepreneur in a world without scarcity of copies? 

    How to make a living as a video games entrepreneur in a world without scarcity of copies?
    [Aaeru] it all depends on your business model
    [Aaeru] consider that the THQ bundle made $5 million by selling 1 cent bundles. http://www.joystiq.com/2012/12/12/humble-thq-bundle-ends-earns-5-million-from-885-000-bundles/
    [Aaeru] the bundle price they were offering was for 1 cent
    [Aaeru] that’s the actual price for the item
    [Aaeru] yet the average was $5.76
    [Aaeru] now where does this 5.76 come from?
    [Aaeru] how is it possible?? asks the copyright-dogma minded
    [Aaeru] the answer i believe, is patronage.
    [Aaeru] the average was 5.76 per customer bcuz that is how much ppl are willing to pay to the artists
    [Aaeru] that’s the market price
    [Aaeru] In this scenario, the value comes from the patrons. The 5.76 exist, because the customer knows most of their money is going towards more video game creations. That is why it is worth 5.76. The folks at humble bundle recognizes this, and their ingenious innovation was ‘Transparency’. Of course there are lots of other innovations, but this is one of the primary ones.
    [Aaeru] humble bundle shows us that even in the absence of scarcity of copies,
    [Aaeru] u can still make money.
    [Aaeru] handing out copies for free does not mean that there is no business model

    [Aaeru] This is a very influential article from 2008 http://kk.org/thetechnium/archives/2008/01/better_than_fre.php
    [Aaeru] so when u buy a game from Steam,
    [Aaeru] u are not so much buying the game as you are buying the service surrounding the game
    [Aaeru] u buy it for the convenience, the findability, the online play, the friends system, the community
    [Aaeru] Steam is selling accessibility (i can DL the copy on another comp and play. i dont have to move files around myself)
    [Aaeru] Steam has regular discounts. They are generous.
    [Aaeru] Steam sells me immediacy (the download is so fast)
    [Aaeru] Steam has achievements.
    [Aaeru] if you create video games for a living, you are a video game entrepreneur
    [Aaeru] It is the entrepreneur’s job to find a way to monetize on their own creation. This is not factory work. The money doesn’t just roll in, Okay? In entrepreneurship you must find ways to serve the customer in the way that they would like to be served, not in the way that you would like to serve them.
    [Aaeru] u have to find a way to serve your customer in a world where every one of your customers become your competitor as soon as you’ve sold to them (everyone with an internet is a printshop). It is a world where the industrial activity of reproduction has become infinitely cheap. And because basic economics tells us that price of goods tend towards marginal costs given enough time, therefore the price of paying someone to reproduce you a copy right now, has reached $0.00. Therefore, don’t sell reproduction. No1 wants that.
    [Aaeru] It is not enough to just serve them. You must serve them in a way such that they will be willing to let go of their money despite the free copies.
    [Aaeru] in fact Gabe newell said he doesnt consider piracy a problem anymore
    [Aaeru] bcuz he has Outcompeted piracy.

    • Tsukotaku 12:37 pm on February 15, 2013 Permalink | Reply

      Mmh, only a question: do you forgot about the millions of dollars behind each title you mentioned? AAA titles are titles with a big budget, and those were AAA titles. So, no you can’t make a living with this. With that bundle THQ probably was whishing to recover some the financial losses, not enough to save the company. Actually they didn’t make an income, in the end naturally.

      • Aaeru 12:54 pm on February 15, 2013 Permalink | Reply

        Before you invest millions of dollars into making a game, you might want to have a clear idea on how to make your money back before you do so. Otherwise you are going to lose your money and possibly go bankrupt. And that’s very bad.

        I don’t want to hear the argument that someone has a right to make a living by creating AAA budget titles. If you don’t know how to make an AAA title succeed, then please drop out. Because someone else who Does know how to, will do it. You do not have a right to turn a profit in your investment. You only have an opportunity to turn a profit.

        If it can’t be done, then just don’t do it. Someone else who is smarter than you will do it. And they will become the next set of artists that get to create AAA titles for a living.

        See J K Rowling scenario. https://sharingisliberty.wordpress.com/2013/01/22/profiting-without-copyright-jk-rowling-scenario/

        • Tsukotaku 2:00 pm on February 15, 2013 Permalink

          Now there’re more accessible license for game engines for privates and small groups, like the UDK’s licenses and the more expensive one of the Cryengine 3. However, with AAA we define a series of characteristics that the project must be.

          AAA Title = considerable amount of developers or personell = big amount of tools and workstations = a studio or a location to work = thousands or millions of € to feed what you intend to make = you need a startup = you need a publisher or something like a private funding

          And that is a very simplistic representation about how the industry works today. You’re the man who make the game for living or passion at least, and not the one who invest to make profit.

          The alternatives to make a career in the videogames industry are mainly two: the first is to find a job related to your knowledges, the second one is the “Indie” one. But honestly we will enter a never-ending discourse with a topic like this, and most importantly we can’t talk about AAA titles with the “Indie” market as subject.

          And I disagree when you say that: “u are not so much buying the game as you are buying the service surrounding the game”. I don’t know what you’re doing to live, but a simple task like make a model, a string of code or maybe a basic background may take hours. So, is not something that everyone can do without problems, and this is why you need a company or someone behind you and your group to a large scale project. And I think the is the biggest motivation of why service like Kickstarter are popular.

          Oh well, there’re also rare occasions when someone can pull up mountain of money with simple title and without the hand of no one. 😛

  • R 7:37 pm on January 22, 2013 Permalink | Reply
    Tags: Profit without Copyright   

    Profiting Without Copyright: JK Rowling scenario 

    Imagine someone like JK Rowling.

    She writes a Harry Potter novel. She sells copies on her site and makes a bit of money, but then it gets popular so pirated copies start circulating too. She then becomes wildly popular, in part due to piracy. And probably 90% of the people who got bootleg copies would not have bought the book anyway. So she loses some sales, but now she is very popular.

    So she has book 2 written. She posts a note on her site to her fans saying that she has book 2 ready to go, and she’ll release it as soon as she gets a million pre-orders for $5 each. In a month she has $5M in the bank and so she releases the book. And then she makes another couple million more, and then sales taper off because of piracy and normal attenuation. Then she repeats this with the next 5 books. Soon she is worth $100M.

    Meanwhile three different movie studios begin making a movie version of her first novel–without her permission. She gets no payment but on the other hand this drives more sales of her earlier and upcoming books–it acts as advertising for her. But one of the three movie studios, realizing it has competition from the other two, seeks a way to distinguish its movie. It approaches Rowling and asks her to consult on the movie and to promote the movie as the “best” and “authorized” version. They pay her $1M plus 2% of box office receipts, and she consults, helps improve it, and makes sure they don’t adulterate her plot too much etc. Or maybe she helps with the screenplay. In any case the “authorized” movie does way better at the box office than the unauthorized versions–if you were a Harry Potter fan which of the 3 would you want to see? Maybe all 3. but if you could only see one…. the one the author authorized of course.

    And let’s say all this was on a lower scale. The money might not be as much, … but maybe the author is famous enough to get a job offer teaching in an English literature department. Or writing or polishing screenplays. Or copyediting others’ draft novels for a fee.


  • R 4:30 am on October 22, 2012 Permalink | Reply
    Tags: Profit without Copyright   

    Why The Music Industry Should Be Thanking Illegal… 

    Why The Music Industry Should Be Thanking Illegal Downloaders

    Next month, people who download music illegally may start getting anti-piracy warnings from their Internet Service Providers. If recent research is any indication, maybe they should be getting “thank you” notes instead. 

    Turns out that people who frequently download music without paying for it actually end up buying 30% more music than everybody else, according to a study from the National Assembly at Columbia University. This isn’t the first research that has shown file-sharing to be beneficial to artists, but this comprehensive study blows yet another good-sized hole in the conventional music industry wisdom. 

    It makes sense, though.

    That heavy-duty downloaders also pay for lots of music isn’t shocking, considering they’re likely to be much more passionate music fans than others. In Napster’s heyday, I must confess, I routinely queued up albums to download overnight, which I then burned onto CD-Rs before walking to high school in the morning (this was pre-iPod). I quickly grew accustomed to the immediacy of file-sharing and before I knew it, I had ripped the audio from all of my CDs so I could get rid of them once and for all. When Napster shut down, I switched to Soulseek and blog searches to find MP3s. 

    See Also: Music Piracy Debate Reignites, Despite Evidence That Digital Distribution Pays

    I still paid for some music, especially if it was recorded by a smaller, independent artist whose work I wanted to support. But of the several-hundred gigabytes of music I amassed in the early 2000s, the majority of it was pirated.

    Over time, though, my music consumption habits – along with my disposable income – evolved. So did the digital music ecosystem. These days, I spend $10 per month on a premium Spotify subscription and on top of that, am known to eagerly drop at least another $30 on vinyl records per month, on average. Last month, when I set foot in San Francisco’s Ameoba Music for the first time, I may or may not have gone a little overboard. It makes sense to me that those of us who hopped onto peer-to-peer networks are also quick to throw down some actual money for music, even while others aren’t. 

    That isn’t to say that file-sharing hasn’t done very real, palpable damage to the traditional business model of the music industry. It has. Put more accurately, the changes in music consumption and consumer expectations brought on by the advent of the Internet, have crippled the old model. 

    On one hand, that’s hurt deep-pocketed gatekeepers who are widely perceived as having hampered innovation for years (instead opting to sue Internet companies and consumers alike). It’s hard to shed too many tears about that. On the other hand, the decline in album sales has also hurt what musician and piracy critic David Lowery calls the “middle class of the music industry.” Music might be easier than ever to create, disseminate and discover, but it’s still quite difficult to make a living creating it. 

    As encouraging as the National Assembly numbers might seem, paying consumers like me are not enough to “save” the music industry, or at least the version of it that existed 15 years ago. It’s gone. But maybe that’s okay.

    See Also: BitTorrent Downloads Booming – And Benefitting Musicians

    Perhaps it’s time, as many have suggested, to stop thinking about recorded music as the cash cow it once was and instead treat it as a smaller revenue stream that has enormous promotional value to support an artist’s other work: touring, merchandise, licensing their music and selling it in deluxe package with extras that fans can’t download. 

    It’s hard to picture overall music sales numbers climbing back up to their pre-digital heights anytime soon. Listeners are being conditioned to expect to find and listen to music instaneously, with or without shelling out money for it. That trend started with Napster and continues today with more legitimate services. Today’s teenagers instinctively search for new releases on Spotify. If they’re not there, they check YouTube or SoundCloud. Some might pay for a download from iTunes or Amazon, but with so many free and ad-supported options, why bother forking over actual dollars?

    In 2005, authors David Kusek and Gerd Leonhard imagined a future in which everyone carries Internet-connected media players and subscribes to a massive library of music in the cloud. “Music like water,” they called it. That’s exactly where we’re headed with smartphones and services like Spotify and Rdio.

    Early research conducted in Sweden suggests that subscription services help reduce piracy. Yes, the financial viability of the services model is still unknown, and many artists are nervous about the financial payoff. But there’s still hope that with enough scale, those services can help the music industry thrive in the 21st Century. Even if it looks very, very different than it once did.

  • R 9:32 am on October 21, 2012 Permalink | Reply
    Tags: Profit without Copyright   

    A huge percentage of the 20th century’s most brilliant musical minds would have starved without a day job. 

    “Schoenberg, Webern, Berg, Ives, Boulez, Bartok, Varese, Messiaen, Nancarrow, Babbitt, Perle, Barraque…in fact, a huge percentage of the 20th century’s most brilliant musical minds would have starved without a day job.

    Schoenberg taught composition, Webern made arrangements for night club bands, Ives sold insurance, Boulez worked as a conductor and so on. Their jobs were often related to music, but if they had depended on sales of sheet music or royalties from record sales they would have starved. Some of them came close to doing so anyway.

    This is all quite true, but few here really seem to grasp the implications of it.
    If you wanted to know, the so called ‘pirates’ are responsible for much of the modernity in communication that you see today. Everything from the printing press to the modern cinema was brought about by these so called ‘pirates’. Even Hollywood has pirate roots.

    Gutenburg was a ‘Pirate’, as he printed copies of the Bible and gave it to people. The church labelled him a pirate and the idea of copyright was introduced then and there. It was made a full fledged law by Mary, Queen of the Scotts.

    The internet as you see it today, with the ability to communicate and get content easily (yes even paid), was brought about by Napster, which brought about a revolution in music sharing, and which eventually gave birth to the idea that Apple had. Without piracy, no napster, without napster no iTunes and all the awesome sharing facilities and content you see today.”

    More is available here:

    thedude321 (22 hours ago) in reply to Anon

  • R 2:53 am on October 8, 2012 Permalink | Reply
    Tags: Profit without Copyright,   

    Rick Falkvinge: It’s Time To Debunk The Myth That Copyright Is Needed To Make Money – Or That It Even Makes Money 

    Myth: If you take away the copyright monopoly, there’s no way for artists to make money.

    Fact: This is a very odd myth, given that the old gatekeeper system was the poster child of keeping skilled artists away from any form of income. Under the “sign-a-record-deal-or-remain-poor system”, 99% of artists didn’t get record deals with the abusive record industry – and out of those who did, 99.5% never saw a cent in royalties. Thus, we are moving away from a system that deliberately kept 99.995% of artists without any form of regular income for artistry.

    Observing that, I find it preposterous to claim that any shift towards a more inclusive system without those gatekeepers will somehow “take away the possibility of making money for artists”, especially given that the now-obsolete gatekeepers took 93% of the cut, on average, for the 0.005% that did make money in this system. Eliminate those gatekeepers and those 93% of the money go to artists instead – or at least, a significantly larger portion of it.

    Myth: The copyright monopoly is an essential source of income to artists today.

    Fact: Out of the money spent on culture, a mere 2% (yes, two per cent) make it to individual artists through mechanisms of the copyright monopoly. This was studied in-depth in Sweden by Ulf Pettersson in 2006 (link to article, direct link to study, both in Swedish), who concluded that the vast majority of artists get their income from other means – everything from a day job to student loans.

    Myth: The copyright industry is vital to the economy overall.

    Fact: The “copyright industry” is deliberately measured in a thoroughly deceptive way that borders on ridicule. According to WIPO’s guidelines as to what should be included when calculating the size of the “copyright industry”, we find everything from paper pulp manufacturing, to kitchen appliance retail sales, to shoemaking (WIPO 2003, via Pettersson’s paper above). If you include practically every part of the economy in group X, and then claim that group X is a vital part of the economy, then it’s going to look like you’re right. Just don’t get caught looking silly when it turns out how you selected that X, and that there’s no correlation at all with what you’re really talking about – the industries benefiting from the copyright monopoly, which are about one-tenth the size of those being held back by it. Want to create jobs? Kill the monopoly.

    Myth: With free sharing, nobody will spend money on entertainment.

    Fact: The household expenditure on culture has increased, year by year, since the advent of large-scale file-sharing with Napster in 1999. (According to some reports, it’s constant – but none claim it’s falling.) It’s true, however, that record sales are slumping and falling through the floor. This fact is excellent news for musicians, who don’t need to rely on middlemen who take 93% of the cut, and have instead seen their own income rise by 114% in the same time period.

    Myth: Without the incentive of possibly getting money, nobody will go into artistry and create.

    Fact: People create despite the copyright monopoly, not because of it. YouTube sees 72 hours of video uploaded every minute. Arguably, most of it will remain unseen, but there are certainly gems in there. Also, the argument is bunk from the simple observation that there is a vast oversupply of artists compared to what the market will hold: you can easily find a professional accountant who picks up an electric guitar in their spare time for a bit of relaxation, but show me one single professional guitarist who relaxes with a bit of bookkeeping in their spare time.

    GNU/Linux and Wikipedia are two excellent counterpoints that shatters this weird myth. The dominant operating system and dominant encyclopedia was created by unpaid volunteers. (When I say that GNU/Linux is “dominant”, I include the Android derivative, just for the record.)

    We have created since we learned to put red paint on the inside of cave walls, not because of the possibility of making money, but because of who we are, because of how we are wired. (Usually, people who are into life for the money don’t go into artistry in the first place. They go to law school or medical school. There’s a reason for the parents’ face of despair when their child says they’ve decided to be a poet for a living.)

    The myth that the copyright monopoly is needed for any kind of artistry to make money, or even to happen in the first place, is an obscene myth perpetuated by those who have something to gain from skimming off 90% of the artists’ money by denying them an audience in an old-style racketeering.

    Can we please move on now?


  • R 7:30 am on September 25, 2012 Permalink | Reply
    Tags: , , Profit without Copyright   

    Eben Moglen: Software is an inherently incremental intellectual product. 

    Vast institutions are committed to the social philosophy that only exclusionary practices inevitably involving the large-scale continuance of unnecessary ignorance are essential to the production of useful information. Vast economic rents are being extracted from the world, and enormous numbers of people are going unfulfilled in intellectual and aesthetic needs that we can provide for. One inevitable consequence of the continuance of that approach is that people are forbidden to share.

    In 1993, the National Information Infrastructure Working Group on Intellectual Property, led by the chair of the PTO, Bruce Lehman, produced a green paper on intellectual property in the evolving Internet, which became eventually a White House policy document in the first Clinton administration. The IP Working Group report stated that, although it would indeed be necessary to increase copyright infringement penalties drastically, that measure would be inadequate to change social behavior sufficiently to protect intellectual property in the net. Accordingly, the IPWG suggested, every school receiving federal funds should have a curriculum in grades K-12, teaching children that it is wrong to share information. They suggested–I am not fooling you–a slogan in the aftermath of Mrs. Reagan’s extraordinary success at ending drug abuse in America. The slogan was: “Just say ‘yes’ to licensing.” What they did not explain was what you called the institution in which you explained to children that it is wrong to share information; it seemed improbable that one would continue to call such a place a school. Nonetheless, I thought that their intellectual honesty was extremely commendable. They had come to the heart of the problem. Their goal was the maintenance of existing social and economic relationships at the expense of incurring the fundamental intellectual inconsistency of their position: that we must teach people that they must not teach others, or else.

    Now, it is in that context that we have made a social network committed to the proposition that the central executable elements of human technology can be produced by sharing–without exclusionary property relations. And that if the central executable elements of technology can be made by sharing, without exclusionary property relations, then the non-executable elements of culture–art, useful information, and so on–can be distributed without exclusionary property relations. It is this process that you are presently witnessing.

    When I began working as a computer programmer for pay, in the early 1970s, there was a goal. Software developers had a purpose. The purpose was embodied in a four-word phrase: “Write once, run everywhere.” It meant, develop software which can be made to run on all of the hardware that even then rather heterogeneously populated society. It was, from the point of view of venture-capital funded, profit-making, investor-owned industries, an impossible goal, never achieved. We did it. GNU, Linux, and all the other thousands of programs in the free software world, run, as Rita correctly said, on everything. From the palmtop, the cell phone, and the single-purpose appliance–like the digital camera and the personal video recorder–to the mainframe. There was one purpose to software engineering overall throughout my lifetime, and we did it. The best-funded monopoly in the history of the world does not even try.

    There are reasons, which I have explored in my writing, including in the piece “Anarchism Triumphant,” that production of executable software without property relations inherently develops superior software–not immediately, but over the long term. The analysis of that proposition I leave in detail for further discussion. It’s essence is this: software (executable software) is an inherently incremental intellectual product. This is an argument, by the way, against the application of the patent system to it, not a philosophical one, but a technical one. The appropriate invocation of the principal of novelty and non-obviousness to software results in zero software patents. All persons reasonably skilled in the art are capable of achieving each result incrementally, from where the art is at any given moment. But more importantly, for our purposes, the process of making software is massively parallelizable when the costs of communication and coordination are reduced near zero.

    The net is a superconductive medium for the creation of software. So, as I wrote in 1999 when it was a little less obvious than it is today, we are witnessing a phenomenon first noticed by Michael Faraday at the beginning of the nineteenth century. Wrap a coil around a magnet; spin the magnet. Electrical current flows in the wire. One does not ask, “what is the incentive for the electrons to leave home?” It’s an inherent, emergent property of the system, we have a name for it: we call it induction. The question we ask is, “what is the resistance of the wire?” Moglen’s corollary to Faraday’s Law says, wrap the Internet around every brain on the planet; spin the planet. Software flows in the network. It is wrong to ask, “What is the incentive for people to create?” It’s an emergent property of connected human minds that they do create. The forms in which they create, like the evolution of spoken and written language, like the disposition of memes, cultural forms, patterns of pottery, shapes of musical endeavor, and so on, are structural characteristics of the human mind. We are a social species, and we create together; that’s our nature. The question to ask is, “What is the resistance of the network?” Moglen’s Corollary to Ohlm’s Law states that the resistance of the network is directly proportional to the field strength of the intellectual property system. The conclusion is: Resist the resistance. Which is what we do. We have been doing it in an exponential growth curve for slightly over twenty years. Now we have forty percent of the server market (note: 60-65% as of 2012). We’re going to have a hundred percent of the appliance market within five years. That’s a trivial economic deduction from the following simple fact: when you sell a four-hundred dollar palm top, you can afford to pay a license fee for its operating system, of $24.95, or $49.95, or incur expensive in-house development activity and make a Palm OS. When the box costs fifty bucks, there’s no room left for paying $12.95 to Mister Gates: we win. We win.

    We all do it together, the software’s a public utility; “Write once, run everywhere”; we’re done. This is a noticeable proposition, not just to us- though we understand why it is socially and politically desirable that the world work this way. It is a noticeable proposition for the International Business Machines Corporation (IBM), too. You now have, after a mere twenty years of work on our part, the largest, best-funded technology company on earth fundamentally on our side with respect to how the information technology system will work in the twenty-first century. San Palmisano, Irving Wladawski-Berger, you read them all the time, there’s a simple proposition: software’s a public utility, computing is an on-demand service provided by service providers who handle the internalized cost of making computing possible, and so on.

    Thus we observe the new political economy of software. If you have a network and you share, you can achieve the ethical goal of allowing everybody to understand, to improve, to find and fix bugs, to create better software, and to share information in a way that allows them to improve their technical skills. Free software is the single greatest technical library on earth. I say that because free software is the only field where a person can go from naiveté, to the state of the art, in everything that a particular field contains, solely by reading material that is universally available at no cost everywhere the network exists. That is the single, greatest intellectual capital development program in the world. The legal system that makes that possible, the GNU General Public License, with which I have some intimate experience, achieves the creation of a greater and more extensive knowledge exchange program than any other in the world, at no cost. When my colleagues at the Massachusetts Institute of Technology (MIT) decided to put their entire curriculum on the web–every course, every teaching material, every problem set, every examination–they were adopting the recognition that the principle of Western science, the principle of free software, and the principle of non-exclusion are the path of development for the twenty-first century, a proposition which has its capitalist echo in the behavior of IBM.

    • Eben Moglen

    Freeing the Mind :
    Free Software and the Death of Proprietary Culture

  • R 7:14 pm on September 21, 2012 Permalink | Reply
    Tags: , Profit without Copyright   

    “How should the people who produce knowledge – whether designs, novels, or software – be paid, then?”

    Well, you know this is of course a question I hear a fair amount. And I think it comes from a confusion. And it’s an odd confusion, in this room, because it makes a distinction which maybe we don’t need to make, and introduces one that we shouldn’t have.

    People get paid, voluntarily, because we love what they do.

    I know that’s true; I pay people because I love what they do, and so do you. We pay – and would be happy to pay more, if we didn’t think that someone else was in the way – for things of beauty and utility all the time.

    What we are losing is the ability to force people to pay. We are losing the coercive distribution system which says: “I won’t give this to you you until you pay me for it first.”

    We’re losing that because people can’t manage to make it work anymore; that’s what it means to be a music company or a movie company in the present world; it’s the distributors who have a problem. Their model was: “We make a profit as distributors because you can only get this from us.”

    And by forcing people to pay, right, they made their business model work.

    We can’t force people anymore, but we can ask them.

    And the reason that shouldn’t be a surprise in this room is: that’s how you do it. You ask people to pay. You tell them “It’s worth it. You love what we do, you care about it, you have passion. Pay us for it.”, and they do.

    You shouldn’t be worried. This shouldn’t be your question, this isn’t your fight, you won it already. The people who are worried are the people people wouldn’t voluntarily pay, and that’s not you.

    We’re going to have every bit as much creativity as we had before Edison; Edison was the guy who made it possible to put the thing in a can and sell it like a product in the store. There wasn’t any absence of music before there were recording companies. Musicians got paid poorly then and they get paid poorly now. [Laughter] The difference was: there were no recording companies stealing from them then, and there are now.

    The issue of “How will people get paid?” is agitating our friends on the other side. But I don’t think it needs to agitate us so much. People pay for what they love. Make what they love; they’ll pay you for it.

    I have an odd business model. I don’t charge clients. I charge people, voluntarily, who make a lot of money in technology, to provide lawyering services for people who don’t make any. And I haven’t fired any lawyers yet. And I’m an unusual law firm in New York city because I haven’t.

    • Eben Moglen


  • R 10:12 am on September 21, 2012 Permalink | Reply
    Tags: , Profit without Copyright   

    Neil Young: Piracy is the new radio. 

    “Piracy is the new radio. That’s how music gets around. […] That’s the radio. If you really want to hear it, let’s make it available, let them hear it, let them hear the 95 percent of it.”

    • Neil Young

    Neil Young on music and Steve Jobs: ‘piracy is the new radio’

  • R 9:52 am on September 18, 2012 Permalink | Reply
    Tags: , Profit without Copyright   

    Pirate Coelho: Don’t they understand that if I hear a song and I like, chances are that I will buy the CD? 

    Pirate Coelho
    The publishing industry will say: Artists can’t survive if they’re not paid.

    In 1999, when I was first published in Russia ( with a print- run of 3,000), the country was suffering a severe paper shortage. By chance, I discovered a ‘ pirate’ edition of The Alchemist and posted it on my web page.
    An year later, when the crisis was resolved, I sold 10,000 copies of the print edition.
    By 2002, I had sold a million copies in Russia, and I have now sold over 12 million.

    When I traveled across Russia by train, I met several people who told me that they had first discovered my work through the ‘ pirated’ edition I posted on my website. Nowadays, I run a ‘Pirate Coelho’ website, giving links to any books of mine that are available on P2P sites.
    And my sales continue to grow — nearly 140 million copies world wide. (…)

    ‘Pirating’ can act as an introduction to an artist’s work. If you like his or her idea, then you will want to have it in your house; a good idea doesn’t need protection.

    The rest is either greed or ignorance



    Paulo Coelho, the best-selling author of “The Alchemist”, is using BitTorrent and other filesharing networks as a way to promote his books. His publishers weren’t too keen on giving away free copies of his books, so he’s taken matters into his own hands.

    Coelho’s view is that letting people swap digital copies of his books for free increases sales. In a keynote speech (embedded below) at the Digital, Life, Design conference in Munich he talked about how uploading the Russian translation of “The Alchemist” made his sales in Russia go from around 1,000 per year to 100,000, then a million and more. He said:

    In 2001, I sold 10,000 hard copies. And everyone was puzzled. We came from zero, from 1000, to 10,000. And then the next year we were over 100,000. […]

    I thought that this is fantastic. You give to the reader the possibility of reading your books and choosing whether to buy it or not. […]

    So, I went to BitTorrent and I got all my pirate editions… And I created a site called The Pirate Coelho.

    He’s convinced — and rightly so — that letting people download free copies of his books helps sales. For him the problem is getting around copyright laws that require him to get the permission of his translators if he wants to share copies of his books in other languages.

    So is Coelho just seeding torrents of his books? That’s just the beginning. He took it one step further and, as quoted above, set up a WordPress blog, Pirate Coelho, where he posts links to free copies of his books on filesharing networks, FTP sites, and so on. He says it had a direct impact on sales:

    Believe it or not, the sales of the book increased a lot thanks to the Pirate Coelho site…

    In his speech he talks about how the Internet is changing language and books, and how online “piracy” and BitTorrent have helped him not only be more widely read, but also sell more books! It’s a must watch.

    Torrent Freak – Alchemist Author Pirates His Own Books
    http://torrentfreak.com/alchemist-author-pirates-own-books-080124/ (see video on this page)

  • R 6:39 am on September 16, 2012 Permalink | Reply
    Tags: Profit without Copyright   

    “Piracy is not your enemy…

    …obscurity is.”

    • Tim O’Reilly
  • R 10:14 am on September 10, 2012 Permalink | Reply
    Tags: Profit without Copyright   

    The world I want to live in 

    The world I want to live in is a flattr button for each animation studio. and i flattr the ones i want to see anime from.
    And when the anime comes out, i get to share it with my friends.

    The world I want to live in is one where 100% of my money goes to making anime. NOT advertising anime. NOT publishing anime.

    I’ll market it for them. I’ll publish for them. They dont need to market it. I am a true fan. I’ll make a website to advertise them. I’ll make a website to publish them. I’ll even hook up a flattr button for them. And I’ll do all of this for free. And I actually WANT to do it.

  • R 11:59 am on September 1, 2012 Permalink | Reply
    Tags: , , Profit without Copyright   

    Daniel Cook: Embracing Piracy 

    Piracy as a fun activity

    I was a pirate in my youth. Many of my fondest memories involve sorting through a giant stack of 3.5" floppies searching for that one diamond in the rough. I’m not exactly ignorant of the practice. In fact, I partially credit my current design chops to playing through such a vast range of hundreds of wonky and experimental games.
    Being a ‘pirate’ was being part of a community. You and your friends shared games like social gaming gifts on Facebook. It didn’t cost you anything to copy a game and give it to someone. A game was a social token to chat about, a gesture of kindness to reciprocate. A key takeaway from that time is that copying and sharing vast quantities of digital goods is a deeply fun, social and highly useful activity. This is a new thing, a new behavior in a post-scarcity world.

    Hacking piracy for profit

    As a young game developer, I believed that ‘piracy’ was the norm. The first game I worked on, Tyrian, used the shareware model. The essential assumption was that people love copying games for free, taking home a stack of 100 and then playing through them like it was Future Christmas. This behavior wasn’t about ethics, morality, legality, etc. It was an observable cultural pattern of behavior that sprung quite naturally and innocently from technology and people mixing.
    If you put out a pool of water and people start merrily flopping around in it, you acknowledge that this thing called ‘swimming’ exists. You can ban it as immoral, but I’d rather invent a sexy sandy thing called a ‘beach’ and get 2 bucks a head for admission.
    With shareware, we hacked the copying behavior. People would play the random floppies and some of clever programs would say "Hey! Did you know that you can pay for this?" And a small portion of users did. ‘Pirate’ and ‘consumer’ are not mutually exclusive properties. In our capitalist society, almost everyone (with a few notable exceptions) is trained to buy stuff. People who like checking out new software for free are really just another audience of potential consumers.

    Observing retail shenanigans from a distance

    Now to the retail world, piracy is kind of philosophically shocking. For much of history, physical goods have featured an inherent production cost. I make stuff, I sell stuff and hopefully the resulting revenue pays for the cost of making all that stuff. This is ingrained… we don’t even think about it. In fact in our specialist world, we’ve abstracted many of the roles and treat them as magical black boxes. Many engineers focus just on the ‘making stuff’ portions of the pipeline. "Oh, I don’t sell stuff; I’m a maker" is the essence of their personal identity. When the rest of the black boxes don’t magically perform ‘selling’ and ‘making a profit’, the world seems broken.
    Over the past 30-plus years, we’ve witnessed multiple generations of business owners coming to terms with this wild new copying behavior. And it is hard. EA used to think of themselves as a company that sold boxes. That is their culture. They hire people that love selling boxes in the same way that engineers like ‘making stuff’. Then they find that 80-90% of the people playing their games didn’t pay for them. In physical goods, that situation doesn’t even compute. Identities are at stake. The closest analogues are terms like ‘piracy’, ‘counterfeiting’ or maybe ‘intellectual property theft’.
    It has been a really confusing time for businesses. Some lashed out by labeling consumers as evil, some tried to protect the old ways with DRM. Relationships with customers…who see themselves as just having fun sharing cool stuff…became antagonistic. 30 years. When you raise kids in a warzone, they grow up parroting propaganda. No wonder the conversation is polarized.

    Embracing the culture of free

    I’ve never really cared much about piracy. Even the term itself is a construct of a retail mentality attempting to protect old business models.
    Those business models may fail in the long run. I have zero emotional attachment to buying games at retail, collecting cardboard boxes or even more radically, preserving the existing forms of games that thrived in the retail world. If all ‘sequels’ aka ‘excuses to get you to buy another box’ stopped tomorrow, I wouldn’t be overly upset. Detach yourself from the emotions of history. Give up the past forms of what games were. Adapt to the current environment with one eye firmly fixed upon the future.
    People copying digital goods as an inherently joyful social activity is an opportunity. It is an artistic opportunity. It is a business opportunity. It is a cultural opportunity.

    – Daniel Cook



    Techdirt: http://www.techdirt.com/articles/20120825/19545120159/piracy-is-cultural-opportunity-embrace-it.shtml

  • R 6:09 am on August 31, 2012 Permalink | Reply
    Tags: , Profit without Copyright   

    Formula to making money as an Artist on the Net 

    The formula to profit on the net is this:
    1) More access to content = more fans
    2) More fans = more true fans
    3) More true fans = more money

    The internet is the Economics of Abundance. Whereas in the 20th century, content was a scarcity (as a child I played through the same Nintendo games over and over again), Today on the internet there is overwhelming content & overwhelming copies (people have huuuuge backlogs), which means My Time becomes the scarcity, not the content nor the copies. See Attention Economy. John Perry Barlow, founder of eff.org states that the internet is monetized through ‘Attention’ or ‘Familiarity’.

    This is how it works:
    The spreading of your copies BUYS people’s Attention.
    The more your work is freely available, the more attention you’ve bought, therefore the more true fans you will generate, therefore the more money you will make from true fans gobbling up your shit.

    Your own fans sharing those purchases has now become your single BEST asset to establishing even more relationships with fans. They have become your co-conspirators, your vehicle of advertisement.  When they copy you, they evangelize you. And that is the best thing that can happen to you as an artist on the net because access to content brews fans, fans brew true fans, and true fans will pay you to make more of your work… Why do they do this? They certainly don’t pay because they Have to pay you… rather… they pay you because they WANT to pay you. They want to exchange their money for more of your work to get made.

    The Economics of Scarcity and the business models of the 20th century is COMPLETELY IRRELEVANT on the internet. In fact it is extremely counter-productive knowledge, it is worthless knowledge, and it now works to hinder us from making money in an environment THAT-IS-NOT-THE-SAME-AS-THE-PHYSICAL-WORLD!  The faster you scrap them the faster you will reach life-sustaining profit.

    Neil Gaiman (a prestigious author) explains it the best:



    • aeliusblythe 3:43 pm on September 3, 2012 Permalink | Reply

      This is a really good reminder to creators.

      If people don’t KNOW your work, they can’t support it. So even if only a tiny percentage of people pay up (which is what creators fear) a tiny percentage of a big number is still MORE than a tiny percentage of a small number!

    • Aaeru 7:10 am on September 15, 2012 Permalink | Reply

      A wealth of information creates a poverty of attention. – Herbert Simon

  • R 4:38 am on August 30, 2012 Permalink | Reply
    Tags: Profit without Copyright,   

    If I’ve paid you to write me an article, I expect to be able to share it. 

    If I’ve paid you to write me an article, I expect to be able to share it.

    If I’ve paid you to draw me a picture, I expect to be able to share it.

    If I’ve paid you to make me a game, I expect to be able to share it.

    If I’ve paid you to make me a film, I expect to be able to share it.

    If I’ve paid you to code me some software, I expect to be able to share it.


    Why is this so difficult to understand?

    • Aaeru 4:48 am on August 30, 2012 Permalink | Reply

      So long as there are 1) People who want things created…
      So long as there are 2) People who are willing to create (for a modest fee)…
      Then 3) The free market will work to bring these two groups of people together (through entrepreneurship and innovation).

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