Athena Shrugged

January 19, 2012

Yesterday’s strike by the modern world’s gatekeepers of knowledge was fascinating, both from a professional campaigner’s perspective and for those of us with an interest in how intellectual property rights play out in the modern world. Whether it achieves its aim has yet to be seen, but the language used to describe it by its opponents is indicative. Phrases like ‘an abuse of power’ and ‘cyber-bullies’ are strongly reminiscent of the language used by opponents of trade unions to condemn withdrawal of labour. Indeed, it’s fairly clear that Wikipedia at least was able to leverage its position as a primary source of knowledge for political purposes, in much the same way as the public sector strikes used the withdrawal of public services as a political weapon.

Of course, there is absolutely nothing wrong with this – politics is part of the competition for limited resources, and condemning Wikipedia for using the levers at their disposal is comparable to condemning the film industry for buying access to lawmakers via their trade association, the MPAA. Attempting to define your opponents’ actions in the political sphere as immoral is often a way of attempting to limit their success. The condemnation of campaigning undertaken by tech companies and web services is in many respects a recognition of the failure of the likes of the MPAA to properly engage the public over the changing definition of intellectual property. This failure is hardly surprising, given that the MPAA’s position is unsustainable.

In order to understand why, it’s important to consider why intellectual property rights are valuable in the first place. In enabling people to profit from their inventions, they directly encourage innovation and are arguably a prime driver of economic development. While they are a constraint upon freedom inasmuch as they prevent people from making whatever they want, they are a reward for something so valuable that they are worthwhile constraint.

However, in the digital age, the cost of production of content can be so low that a financial reward is unnecessary to facilitate innovation. The serried ranks of Wikipedia’s editors carry out their work on an unpaid basis for little greater reward than internet glory. Running costs can be covered by donations from those who want to see that service continued, in much the same way as charities function. This model can even apply to more labour-intensive digital products – consider this paean by the New York Times to the video game Dwarf Fortress, whose developer is funded entirely by donations. You cannot recoup costs from donations if you are not the original distributor of a product. No-one is going to donate money to someone who simply copies Wikipedia onto their own website. This new business model makes profiting from IP theft incredibly unlikely. Only the innovator will see a return. It is those innovators who went out on strike yesterday, in response to an attempt to make this new model impossible.

The MPAA’s preferred business model, if enshrined in statute, would put a halt to a wholly new model of rewarding innovation. The net cost to society for doing so may be significant. If the MPAA’s members believe their products are strong enough that people would seek to support their continued production, then I would urge them to let the market decide, and not hide behind regulation.

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2 Responses to “Athena Shrugged”

  1. Phil Ruse said

    Playing devil’s advocate – I feel like I have to say that to avoid accusations of being a dinosaur – I’m not sure how the MPAA’s preferred business model puts a halt to other models of “rewarding innovation” – surely the innovator still gets to choose?

    The MPAA is trying to create an environment is which its business model has the best chance of working (irrespective of other models), that the measures they wish for (to enable this) are disproportionate, well…

    • Adam Bell said

      It depends on the cost of producing content. The Wikipedia business model relies on being free to link to other content without risk. If there is a risk of litigation because of an inappropriate link – which SOPA would bring in – then the practice of using non-professional unpaid editors would be extremely difficult to sustain. This would significantly increase the cost of producing content, effectively preventing the donation-based model, without a massive increase in donations or a subscription system. Precluding a particular model of innovation is, I submit, likely to have broader economic costs.

      I appreciate that the MPAA is trying to maximise the profits of its members by preventing particular types of competition. This is exactly what lobbying organisations do, and I have no problems with such efforts being made. I frequently do not think they should succeed, but I am not against them trying.

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