O'Reilly:: So do you think the market will return any sort of balance to this? When I think of, for example, software copy protection, we had a lot of similar issues in the '80s about the spread of personal computer software, and people were spending a lot of time with both copy protection on software and on licenses. There was a lot of the same kind of hysteria that it will be impossible to make money on software. And we know how false that was. Bill Gates went on to figure out some business models that work pretty darn well. Do you think that effectively this is just a period of hysteria that we'll get through as people figure out workable business models, or are we in for a real problem?
Lessig: Yes and no. I certainly think that the entertainment industry is going to be pushed to a very different model of doing business, one where the objective is to sell a much higher quantity at a lower price and not worry about theft as much. You know, when it's 5 cents for me to get a bit of music or to listen to a particular song, I'm not going to waste any time trying to steal it. I might as well pay the 5 cents as long as I can pay it extremely easily. (Editor's Note: For an opposing opinion, see Clay Shirky's The Case Against Micropayments.)
So they need to adopt a different business model and that will result in much greater content that's being distributed, but just not at the kind of prices that you're getting now. That would be good for them. So in a sense, you might say that they will voluntarily adopt that expansion or that different business model or at least if existing dominant industries don't get it, the next generation will and so it will change in any case.
But the no part of the answer is that I don't believe that the parallel to 1980s copy protection is perfectly analogous in this case. Because the technology that was used in the '80s to protect software was really very cumbersome and crude. And it elicited a lot of consumer reactions against it because there were so many times where consumers had a completely legitimate reason to want to get access to something and it was just so cumbersome that people were extraordinarily frustrated and angry about it.
That is remedied if these technologies can be developed to seamlessly and invisibly control the content and the access that people have to the content. If you can code it so that it's not cumbersome, it's invisible, it's automatically deducting money every time you do something, itŐs controlling your rights in a very smooth way. If that can be done, the industry will choose to maximize their control rather than to achieve the balance that the original copyright law achieved.
Koman: An argument that the industry would probably make is that they are limited in their ability to distribute the full range of their catalogs of music because of the limitation of radio, of video channels like MTV, and that having access to Internet technologies like Napster or webcasting, will actually let them make available to more people a much wider range of music than is currently the case.
Lessig: Yes, I think there is a story here that industry needs to focus on: about how this is a win for them. People like Michael Robertson at MP3.com are attempting to sell the world on the win that Internet technology has offered to traditional media. I think that there is an unavoidable loss for traditional media that the Internet will create and that is if it goes the way Michael Robertson wants it to go, it will weaken the power of traditional media to control the artists, and the power to control the artists and control what gets distributed and in which ways is at the core of what creates the market power that the existing media has. That's the real threat that the Internet ultimately brings. It's not just about distributing content that they have, it's also about who controls where new content comes from and how it gets produced.
O'Reilly: So, going back to peer-to-peer, do you have any hopeful thoughts or are they all sort of dark thoughts about the dangers of the future?
Lessig: I have some hopeful strategic thoughts. I've been trying to talk up in as many contexts as I can the idea of using these existing forms, even Napster-like forms, to distribute content other than music - audio content, for example, people giving talks or magazines columns that are distributed as Napster MP3 files, to just muddy up in people's minds the question of what's going on on Napster. It's a very bad strategic decision, I think, that they structured it such that 99 percent of what's going on there is an exchange of music, as opposed to the great potential that MP3.com is attempting: to use it for distribution of all sorts of content, most of which has no copyright connection at all. Now that's a hopeful strategic step that I think might help us weather this storm of attack about the copyright stuff.
And the other great hope is, I just saw a story today that Microsoft is developing this thing called Farsite, have you seen this?
Lessig: So here's a very large, smart institutional player who makes a decision to develop technologies to facilitate the use of this extraordinarily underutilized resource on the Net. So it would appear that file-sharing structures could be usable in a commercial context. In my book I'm very skeptical about the role that commerce is going to play in defending traditional liberties in cyberspace. But here I think the quicker we can get mainstream commerce in and doing the things that peer-to-peer makes best, the more solid the defense of peer-to-peer architecture will be.
O'Reilly: Well, it's certainly been our approach with the conference. Our goal has been to try to demonstrate the range of interesting work that people are doing with these technologies. We're really talking about the next generation of network computing, which has hundreds of thousands of applications. In fact, the music issues are a relatively small part of the conference, and I think we will see that. The question is will we see it soon enough?
Koman: I was just wondering if you relate developments in other areas, like the attempt to copyright the human genome or the attempt of pharmaceutical companies to own organic compounds found in nature in the Third World, with this American assent to increase the scope of copyright?
Lessig: I certainly think that this is linked in the sense that the Americans have been selling this view around the world: that progress comes from perfect protection of intellectual property. Notwithstanding the fact that the most innovative and progressive space we've seen - the Internet - has been the place where intellectual property has been least respected. You know, facts don't get in the way of this ideology. This is what we've been selling.
So I do think they are linked in that sense, but I'm not against intellectual property. I'm not even sure that the attempt to patent the processes in the human genome project or in the context of developing pharmaceuticals is a bad thing. I don't know enough about the genome to be able to say that. I do know in the context of pharmaceuticals that if there is one place the patents seem to be doing good, in the sense of inducing innovation by giving a significant return to the developer, it is in the context of pharmaceuticals. So in that context it might actually be a good thing.
But our problem is that lawyers have taught us that there is only one kind of economic market for innovation out there and it is this kind of isolated inventor who comes up with an idea and then needs to be protected. That is a good picture of maybe what pharmaceutical industry does. It's a bad picture of what goes on, for example, in the context of software development, in particular. In the context of software development, where you have sequential and complementary developments, patents create an extraordinarily damaging influence on innovation and on the process of developing and bringing new ideas to market. So the particular mistake that lawyers have compounded is the unwillingness to discriminate among different kinds of innovation.
We really need to think quite pragmatically about whether intellectual property is helping or hurting, and if you can't show it's going to help, then there is no reason to issue this government-backed monopoly.
Tim O'Reilly is the founder and CEO of O'Reilly Media, Inc., thought by many to be the best computer book publisher in the world. In addition to Foo Camps ("Friends of O'Reilly" Camps, which gave rise to the "un-conference" movement), O'Reilly Media also hosts conferences on technology topics, including the Web 2.0 Summit, the Web 2.0 Expo, the O'Reilly Open Source Convention, the Gov 2.0 Summit, and the Gov 2.0 Expo. Tim's blog, the O'Reilly Radar, "watches the alpha geeks" to determine emerging technology trends, and serves as a platform for advocacy about issues of importance to the technical community. Tim's long-term vision for his company is to change the world by spreading the knowledge of innovators. In addition to O'Reilly Media, Tim is a founder of Safari Books Online, a pioneering subscription service for accessing books online, and O'Reilly AlphaTech Ventures, an early-stage venture firm.
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