Power and Property in the
Information Society

This conference is available in its entirety as a downloadable MS Word document. CLICK HERE to transfer the entire transcript to your own system.

Digested First Pages:

Introduction by Richard Farson
Welcome to all of you who will be participants in our ILF conference on Power and Property in the Information Society, and to Walter Truett Anderson, who will moderate it. Walt, a most familiar figure to all of us in the ILF, a prolific author, political scientist and social psychologist, led our conference on globalization. He is the current president of the World Academy of Art and Science. He will be joined in the leadership by four outstanding specialists in this troubling area. They are: Canadian economist Arthur Cordell, editor of Info Trends, focusing on economic, social and political implications of information technology; graphic designer Andrew Peter Fenton, Head of Interactive for the advertising giant, Saatchi and Saatchi Group UK, and interested in all issues relating to knowledge accessibility and transfer; theoretical physicist David Peat (also trained in Jungian psychology) is director of the Pari Center for New Learning, in Tuscany, Italy, author most recently of From Chaos to Uncertainty: The Story of Science and Ideas in the 21st Century, and is particularly interested in the future of knowledge in the information society. Stanford law professor, Lawrence Lessig, may also be joining us, and has made his new book, Free Culture, available to us online. It explores the technical and legal restrictions that publishers and other large media corporations use to control information and keep it from the public domain—a process Lessig believes limits creativity. To get a head start on the discussion, you may want to download it by clicking on this link:

http://free-culture.org/freecontent

So here we go on an exploration of the psychology, politics and economics of information access, transfer, protection, piracy and corruption. It may be a bumpy ride.

Participant
One of *the* most critical issues to define the future. I need this discussion to understand the issues and am awed that we get the opportunity.tellectual Property as a Scarce Resource

Walter Truett Anderson
One of the recurrent themes we'll be wrestling with in this conference will be the question of what's appropriate. There is no doubt in my mind that people who create intellectual goods should have some legal protection that guarantees they be rewarded for their efforts. My living is based on that. But there are many other issues: should I get paid every time somebody quotes a sentence from one of my books? Should my grandchildren, who had no part in producing those works, be entitled to future income from them?

There are very big controversies around such questions, involving huge and powerful interest groups and matters of national and international policy.

I look forward to getting into them, and hope you will all take the opportunity to download Lessig's book, which is an excellent survey of the subject. You might also want to check out the article I wrote some time ago, which is in the archives.

Participant
I'd like to review that article, Walt. Was it part of the conference on Globalization? I went to the Archives without stumbling on it.

Walter Truett Anderson
Excuse me, Ray. I gave you a bum steer. It's in the "Commentaries" section.

Participant
Economics can be said to be the study of the allocation of scarce resources among competing uses. Scarcity means that one person’s use of the resource deprives or ultimately affects the other person the use of that resource. Hence economics is a study of how that allocation can take place so as to optimize benefits.

The distinction is usually made between free goods and scarce goods. Free goods such as air and, say, ocean water, can be consumed without regard to depriving others of their value. Scarce goods must be allocated in some way and prices and markets serve the function of allocation.

Copyright has served to protect the creators of such material. Proceeds from copyright material flowed back to the creators of such material and the payment served as a stimulus to provide still more output.

In the days before computers, the Net and file transfer or peer to peer, the system worked well. While music and text were intangibles they were expressed in terms of tangibles: books, records and tape. Once the work was created, the fact that it was in an tangible form meant that scarcity existed and such scarcity could be enforced. So students who went to a copy shop and copied chapters or an entire text of a book for distribution with or without pay were prosecuted for violating copyright. Copying music was costly and onerous. Blank tapes cost money and taping takes time and trouble.

With the coming of computers, the Net and file transfer it became quickly apparent that this material could be easily copied and transferred to others. In the digital world of ones and zeros, costs were negligible and transfer could be made to one or to a million at basically the same cost. Furthermore, the use of the material by one person did not deprive the next person of the use that material. Contrast this to the earlier tangible era where one person reading a book, listening to a record or tape meant that to enjoy the copyrighted material; the second individual had to buy a copy of his/her own.

Suddenly we are faced with a technology that is very disruptive. The world of scarcity suddenly becomes the world of potentially free goods. Usage by one doesn’t affect usage by others.

It changes the business model for many who were "protected" by copyright. But the issue suddenly becomes: How does society ensure a continued flow of creative copyright materials?

How to compensate those who create intangibles such as novels and music when the new era of the Net makes copying so easy and makes enforcement of copyright so "heavy handed" and ludicrous? It seems difficult to believe that our society will tolerate the emergence of "copy enforcement police." When will see the emergence of a new pricing mechanism? A mechanism that ensures that enjoyment is maximized (those who want to listen or read will be able) and those who produce these creative works will be compensated.

What will the new business model be? How will pricing, distribution and marketing take place?

Walter Truett Anderson
If you look at the big picture, in relation to the economic forces Art has described, you see many players and movement in several different directions. For one thing, there are the big media empires, such as the one I mentioned in the article, that have a strong vested interest in maximum protection of copyright. Sometimes this can become rather ludicrous, as in the case where they went after the Girl Scouts to make them pay royalties for the songs they sing around the campfires. We now have a global structure for copyright protection. It's also full of holes, as witness the enormous amount of illegal copying and black marketing that goes on everywhere. And we have the "open source" movement in the world of software. Everything is becoming more global and more high-tech--both in terms of new ways of protecting property rights and new ways of stealing and copying.

Walter Truett Anderson
In today's New York Times, which I just got around to reading, there is an article that bears on one facet of this discussion: file sharing. A couple of economists have issued a study reporting that it isn't hurting record sales--mainly because the people who download would not have bought records anyway. "Downloads have an effect on sales," they say, "Which is statistically indistinguishable from zero."

Participant
Arthur: Your 1:5 is an excellent summary of material which I am sure will make this another exciting trip. Early in your discussion, you say: ""Free goods such as air and, say, ocean water, can be consumed without regard to depriving others of their value."

In recent years I have pondered over the place of these "free goods" in our current economy. It has seemed to me that for our future benefit, these essential items--and others also in the open domain--must be assigned costs. I look forward to further thoughts of yours on this.

Participant
Many things that are "free" in this society carry advertising as a way to pay for the free offering. Some books do too. Perhaps that is the inevitable, if somewhat distasteful, consequence of free content. Is that better than artists and authors being unable to afford writing or performing?

Participant
I suppose the danger with any creative act is its transformation into a commodity. As soon as a market orientation enters the picture, then literary and other artistic standards that the professions encourage are altered, and the commodification process begins. Some critics believe commodification is among the greatest corrupting dangers to our society. I'm afraid I agree. In fairness, I must admit that a market orientation may sometimes improve quality. Surely a higher quality production of Aida will draw a larger audience. (I'm actually not sure of that, and sometimes a larger box office still doesn't cover the added expense for quality.) It still doesn't reach the mass audience. I doubt that John Steinbeck would outsell Danielle Steele.

Participant
The New York Times article Walt mentions (about music downloading) is encouraging. It will be interesting to see the effect of Lawrence Lessig's sharing of his book on the Internet on its hard copy sales. Many, who do not depend upon book or music sales for their livelihood, such as professors, would probably trade book royalties from a sale of $10.00 books for a readership of a million on the Internet. Other considerations such as impact, fame, prestige, etc. certainly enter into the motivational picture.

Role of Technology in the Crisis

Participant
I am not yet sure of what we are discussing. Walt said "appropriate" and that seems like a good frame. If we reduce "appropriate" to mere economics, the discussion is over, because it is a closed model. In that model, everything that is must be owned, and the dynamics of ownership lead to concentration as in Murdock or Walmart.

The idea that current copyright serves the creators well is too absurd. It mostly benefits the owner who is rarely the creator.

The ownership model moves into everything, including air, water, or "freeways". Next is your DNA, a village created DNA, and then come memes. Current computation would allow sentences and phrases used by a writer to be sourced, and the use prohibited except on payment. A micropayment model of this can be created easily (and, I am sure, has).

Even as a writer I cannot be sure I can give to the "public realm" because the government now has the "right" to sell, for example, a painting I give to the National Gallery. There is no longer any guaranteed public space.

So I think copyright raises deep issues outside and beyond the market/economy issues.

A wonderful speech on the issue is at

http://www.baen.com/library/palaver4.htm

Macauly in Parliament 1841. He lays out many of the issues.

Technology, such as the Internet and digitalization, did not create the copyright crisis; it was already there in congress's willingness to extend copyright way beyond the creator's lifetime.

But maybe I am off course on what we want to discuss.

Participant (Quoting Donald at 1:8)
"Free goods such as air and, say, ocean water, can be consumed without regard to depriving others of their value."

In recent years I have pondered over the place of these "free goods" in our current economy. It has seemed to me that for our future benefit, these essential items--and others also in the open domain--must be assigned costs. I look forward to further thoughts of yours on this.

I agree. Traditional economics used to use the examples of air and water. Now that both are polluted we know that neither is a "free" good. Which is why I chose to use the example of ocean water. My use doesn't deprive you of your use: Unless of course I am dumping pollutants.

While the examples can be criticized the idea is clear: Technology has suddenly made a scarce good relatively free. It can be used and enjoyed by many without depriving the other of its utility.

The problem remains how to provide incentives to creative talent.

The issue it seems is of developing a new business/pricing model.

Walter Truett Anderson
What I'm mostly after here is for all of us to form some kind of a map of what's going on now in this field, and to proceed from there to investigate questions of appropriateness and fairness--and of course relevant public policy issues.

Some of the pieces of the map, in my view, are the following:

1. The extension of copyright protection in the US (and elsewhere).

2. The emergence of a global regime for the protection of intellectual property rights.

3. Rapid and accelerating technological progress that keeps changing the shape of the playing field.

Following Lessig's lead, I stress appropriateness and fairness because I assume that we are all in agreement with his idea of a "free culture," which strikes a balance between anarchy and control. He writes in the preface to his recent book: "A free culture is not a culture without property; it is not a culture in which artists don't get paid. A culture without property, or in which creators can't get paid, is anarchy, not freedom."

Of course, when you talk about "striking a balance" you open the door to dialogue and differences of opinion, all that slippery and difficult stuff. And dialogue, in my opinion, always works better when you keep it grounded in what's going on as well as in abstract principles.

This conference is available in its entirety as a downloadable MS Word document. CLICK HERE to transfer the entire transcript to your own system.

top