25 June 2009

Finding a fair price for free knowledge

I found this article quite thought-provoking. It highlights how the explosion of free information has undermined the 'economy of scarcity'.

And indeed the article asks some pertinent questions: Will we cling to scarcity just so that we can keep capitalism? Or will capitalism have to evolve into some new kind of digital economics? The question underlines many things - from music piracy to the woes of the newspaper industry to Google's efforts to scan all the books in the world.

Finding a fair price for free knowledge
Peter Eckersley, New Scientist 24 Jun 09;
TEN years ago, a piece of software called Napster taught us that scarcity is no longer a law of nature. The physics of our universe would allow everyone with access to a networked computer to enjoy, for free, every song, every film, every book, every piece of research, every computer program, every last thing that could be made out of digital ones and zeros. The question became not, will nature allow it, but will our legal and economic system ever allow it?

This is a question about the future of capitalism, the economic system that arose from scarcity. Ours is the era of expanded copyright systems and enormous portfolios of dubious patents, of trade secrecy, the privatisation of the fruits of publicly funded research, and other phenomena that we collectively term "intellectual property". As technology has made a new abundance of knowledge possible, politicians, lawyers, corporations and university administrations have become more and more determined to preserve its scarcity.

So will we cling to scarcity just so that we can keep capitalism? Or will capitalism have to evolve into some new kind of digital economics? The question underlines many things - from music piracy to the woes of the newspaper industry to Google's efforts to scan all the books in the world.

This fragile scarcity has a purpose: to make things expensive. Water is plentiful and essential; diamonds are rare and useless. But diamonds are much more expensive than water because they're much rarer. People in the business of selling information have good reason to want a future where knowledge is valued like diamonds rather than water. Here pharmaceutical giants, Hollywood, Microsoft, even The Wall Street Journal speak with one voice: "Keep expanding copyright and patent laws so our products remain expensive and profitable." And they pay lobbyists worldwide to ensure this message reaches governments.

The irony of the battle between advocates of abundance and advocates of scarcity is that both sides are right. It makes no sense to limit and control access now we have technologies to give information to everyone. But it is also foolish to pretend we do not need incentives to help produce and publish that information.

While financial incentives are a very complicated business, two simple points hold true. First, even without payment, some folk will always record music, write software, make their feature films, do their own investigative journalism, occasionally even test their own drugs. You couldn't stop them if you tried. Second, we will all be better off with more, not fewer, professional careers available for knowledge producers. Not having to stick with a day job allows creative workers to be more creative and productive, for the benefit of all.

Crucially, though, if we really want to end scarcity, we will have to build institutions that promote knowledge-sharing, while at the same time ensuring that there are incentives for creative and technical minds to contribute.

Science, and the universities that support it, is the grandest example of a system that has evolved to promote the abundance of knowledge. Universities offer incentives in the form of tenure, promotion and prestige to researchers who can discover and share the information which their peers consider most valuable. Academics are human: they are as greedy, short-sighted and treacherous as everyone else, but the academic environment encourages them to focus those vices and impress their colleagues with their cleverness and cool discoveries published in fancy journals. Sometimes those cool discoveries are imagined or incomplete, but then others get ahead by pointing this out, and when the whole process works, the result is science.

In recent years, however, science has become another front in the conflict over scarcity. As any biologist will tell you, patents, secrecy and commercialisation have become a way of life. At the same time, science has inspired new institutions and movements that promote its ideals and its liberty.

Take the open access movement, which has campaigned to ensure that scientific articles are freely available to the public, who ultimately paid for the research with their taxes. Historically, most scientific writing was confined to expensive scholarly journals and essentially available only to people with university affiliations. Some publishers resisted the open access movement, but trends are against them. In March this year, for example, the US Congress made permanent a requirement that all research funded by the National Institutes of Health be openly accessible, and other countries are following. Within a decade or two, it is safe to say that all scientific literature will be online, free and searchable. Journal publishers will still be paid, but at a different point in the chain.

Outside the universities we have some even more remarkable developments. Fifteen years ago, who would have predicted that teenagers would be allowed to edit the world's primary reference source from their homes? Twenty years ago, who would have predicted that teams of volunteers would succeed in writing and giving away software that produces many billions of dollars of economic wealth?

Wikipedia and the free and open-source software movements have produced stores of knowledge while trying to insulate themselves from the old institution of copyright, which is inherently unsuited to their processes of authorship. But that's not enough: we urgently need institutions to liberate knowledge produced under the old rules, too.

The music industry, for example, is slowly realising it cannot win the war on copying. People are pirates, and there are still 10 songs copied for every one bought on iTunes. Soon, the record labels will start to experiment with alternatives to copyright, such as licences that allow unlimited, restriction-free file sharing in exchange for flat fees, maybe a $5 or $10 voluntary payment with your monthly internet provider bill. This kind of system will not be perfect, but it will allow us to have wonderful libraries of legal MP3s, and it may help more independent professional musicians to flourish.

Another experiment in post-scarcity capitalism concerns the digitisation of the world's books. One draft of the rules for access to scanned books is currently being written in the US courts as Google settles a class action over its scanning projects. This settlement will make books more searchable and improve access to both out-of-print and "orphaned" books whose copyright holders can't be found. Under the current version, books will only be available in snippets and sections. Some out-of-print books will be available through institutional and individual subscriptions, but we don't yet know whether the prices will be inviting to most of the public, thus making Google Books a true post-scarcity project.

So here's a challenge to the governments of countries that want to lead the way, whether rich or poor: sit down with Google (or one of its competitors), authors and publishers, and work out a deal that offers a complete, licensed digital library free to your citizens. It would cost taxpayers something, but less than they currently spend on buying scarce books and supporting large paper collections. It would be great news for publishers and authors, who would receive most of the funds and would no longer need to fear piracy.

It's time to recognise that when we build institutions to promote the abundance of knowledge, everybody wins. When it comes to knowledge, you can never have too much of a good thing.

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