What Makes Something "Better Than Free"?

Stanislav_J writes "In a very thought-provoking essay entitled 'Better Than Free' Kevin Kelly, Senior Maverick at Wired, probes the question of how thoughts, ideas and words that are so constantly, easily, and casually copied can still have economic value. 'If reproductions of our best efforts are free,' he asks, 'how can we keep going? To put it simply, how does one make money selling free copies?' He enumerates and explains eight qualities that can, indeed, make something financially viable — 'better than free.' A very timely article in light of the constant discussion of RIAA/piracy/copyright issues."

Comments

chocolate

[Timesprout]

nuff said

What's Better Than Getting Paid?

[NetSettler]

The article makes some quite useful observations in terms of categorizing present trends and is a worthwhile read for that purpose, I think.

But I'm uncomfortable with its "conclusions", if it can even be said to have any. (It seems to indulge a sense throughout of "this is ok, things are good, we just need to embrace them".) From the article:

In short, the money in this networked economy does not follow the path of the copies. Rather it follows the path of attention, and attention has its own circuits.

If I reworded this as:

In short, the money in a networked economy does not go to the people doing the work. Rather it follows the path of who controls the view, and that path has its own circuits.

it would sound a lot less benign.

He makes some casual references to the need for trust and the willingness of people buying to give money to creators. But he overlooks the fact that it's in the best (financial) interest of the people who are the conduit to do as much as possible to obstruct the ability to do this.

The industry thrives (for now) on talk of riches that can be achieved in this new world order if people just contribute freely and hope the money comes somehow, but the obvious truth is that that works better for the people who get the money than for the people who don't, and when you're touting that there's no correlation between where the money goes and where the credit is due, that's not sounding too good to me.

Just look at how long it took the TV writers to get what was obviously due them, and they were very organized. Now imagine how much difficulty a group of uncoordinated netizens is going to have getting the same, since when any number of them boycott their "jobs" putting out free content, there are gonig to be any number of others rushing in to fill the gap for free, causing the content deliverers to say "gee, why should we pay them at all?"

Re:What's Better Than Getting Paid?

[mspohr]

But I'm uncomfortable with its "conclusions", if it can even be said to have any. (It seems to indulge a sense throughout of "this is ok, things are good, we just need to embrace them".) From the article: In short, the money in this networked economy does not follow the path of the copies. Rather it follows the path of attention, and attention has its own circuits. If I reworded this as: In short, the money in a networked economy does not go to the people doing the work. Rather it follows the path of who controls the view, and that path has its own circuits. it would sound a lot less benign.

I think you have missed his point here. The money DOES go to the people doing the work. Except the 'work' is the not necessarily the people who made the original work but the people who are adding value through immediacy, personalization, interpretation, authenticity, accessibility, embodiment, patronage, and findability.

I believe that his real point is that it is no longer sufficient to 'create' something and then retire on royalties but you must go out and continually provide value for that creation in the ways he lists. This is the great shock to traditional businesses publishing books, music, software, etc. Their business model has been formed on the scarcity of copies and they have failed to adapt to the reality that copies are no longer scarce.

Actually, I kind of like the concept that you have to work for a living by continually providing value rather than create a monopoly on some idea or expression of an idea and coast on monopoly rents.

Re:What's Better Than Getting Paid?

[PietjeJantje]

Actually, I kind of like the concept that you have to work for a living by continually providing value rather than create a monopoly on some idea or expression of an idea and coast on monopoly rents. Let's put it this way, let's not take the RIAA as an example because that has been muddling the discussion into a mono copyright bashing affair.

If an author, say Douglas Adams (rip), spends a couple of years on a book, your equation does not work. That is because it is based on an investment of time, and you need a return for that. Creating value after that, for instance based on your popularity, is nice, but not economically related to the investment needed for the addition of value to the initial product. Also his audience, and book readers in general, might be less inclined to purchase services after the free copy.

Do we want a culture based on the commercial return on t-shirts and such? Would Adams have written the books? I for one prefer having given him some monetary units for his product, than obtain it for free, then see if I like him and toss him some coins like he's some kind of beggar.

I believe copyright and old-fashioned publishing are outdated mechanisms in digital times. I also believe that over time many money grabbing industries got a firm, unhealthy grip on the writers, artists, etc. But I also believe the single-minded mono-culture of simply proclaiming everything related to copyright as evil, and magic solutions like making everything free and then it will all be solved, is just silly and a cover-up for the fact that people like to take things for free while not having the worry about the morality of it. This makes one equal to the RIAA. Full of greed and hypocrisy.

Re:What's Better Than Getting Paid?

[oojimaflib]

If an author, say Douglas Adams (rip), spends a couple of years on a book, your equation does not work. That is because it is based on an investment of time, and you need a return for that. Creating value after that, for instance based on your popularity, is nice, but not economically related to the investment needed for the addition of value to the initial product. Also his audience, and book readers in general, might be less inclined to purchase services after the free copy.

Do we want a culture based on the commercial return on t-shirts and such? Would Adams have written the books? I for one prefer having given him some monetary units for his product, than obtain it for free, then see if I like him and toss him some coins like he's some kind of beggar.
While I'm aware that your argument may well hold for some people, Douglas Adams is a _really_ bad example in this case. Indeed, he's a fine example of the counterargument:

Douglas Adams (DA) is paid by the BBC to write a radio series. This is given away, for free, by the BBC, over the airwaves (I don't think that there was a radio license by the time Hitch-hiker's was broadcast). DA chose then to add value to the original product (the radio series) by: writing sequels, adapting it as a book, adapting it as a TV show etc., cashing in on its (and his) popularity.
Now clearly, in this proposed new world of content distribution, different ways of cashing in would have to be chosen, but the principle still holds. DA would have written the work regardless, as it was initially paid for by a corporation that wanted the content. How he then chose to cash in on his success was then simply a product of the time.

This is not to say that this will hold for every author--public service broadcasters can't be expected to employ every content creator--but DA is a fine example of exactly how you can make money by giving stuff away for free.

A Step in the Right Direction

[orionop]

In a free-market world with supply and demand determining costs, it makes sense that digital information that is in infinite supply will cost nothing. The things that are listed in TFA are things that can not be distributed infinitely and thus help guide artists and software providers toward adding valuable content that customers will pay for. Maybe sometime soon we will see less lawsuits and more content.

Re:A Step in the Right Direction

[ThosLives]

...then we need some alternative to markets for encouraging the creation of copyable things. Nobody knows what though...

We already have this. It's called people finding something they like to do for which other people are willing to trade goods and services which the former people want and/or need. If people enjoy making copyable things, and other people want those copyable things, then the balance works.

There is no rational argument for a system which enforces people trading for something I want to produce if that thing I want to produce is not desired. There is also no rational argument for forcing people to create something they don't want to create if there are people that desire it (but don't want to provide it themselves). To use two examples common in these conversations: If I create a song, there is no obligation for people to pay for it. If I only hold concerts and people want recordings, I am under no obligation to provide those recordings. (Note that I'm just talking about obligation, not about if it's a good idea or not.)

The bit where technology is helping is where it helps match up the desires of the creators with the desires of the traders.

That's it, and anything else is just what I would like to call "economic friction."

WOW, Immediacy!

[Anonymous Coward]

Immediacy -- Sooner or later you can find a free copy of whatever you want, but getting a copy delivered to your inbox the moment it is released -- or even better, produced -- by its creators is a generative asset.

Yes, yes, this is exactly what I wanted, the whole article immediately available here, instead of having to click on the link!

How much do I owe you? Where do I pay?

I would like to add "Connectability"

[Sique]

Information increases its value if it is connected to other information. Many inventions happen when separate, wellknown concepts were put together for the first time. No, I am not talking about "business method performed on the Internet", because this connection is very simple. Putting two things together of which one is all the rage is easy.

But in a cloud of possible dots finding the right ones and connect them actually creates value, and if the number of possible dots increases, the value of the single dot may be negligible, but the combination of the right ones gets more and more value. The process thus is twofold: Make every dot as connectible as possible, and find a way to spot valuable connections. Construction kits for children like LEGO show how you do it for the single dot. Every piece of LEGO can connect to every other piece (ok, sometimes with the help of a third piece, but the overall structure itself remains the same).

I hear often complain that open source software is "not innovative", and then it points out that it wasn't able to invent a single new type of building block for software. That complaint got it all wrong. LEGO also didn't invent a single new connector since the introduction of LEGO Tecnic. And when was the last time a new type of brick was invented? Often the invention of a new type of dot means that you can't connect it to anything. So the invention itself is completely worthless until you invent a way to actually connect it to something.

Many a commercial software has its value because of its combination of wellknown "dots". Photoshop is the standard because it combines Hundreds of wellknown algorithms in a unique way. SAP R/3 even is completely "open source" in a way meaning that everyone with developer rights on a SAP R/3 system can look into the complete source code of every subroutine and function block, and change it at will. But SAP R/3 draws its value from the fact that it implements so many different business concepts and business logics. Every single of it is well known, but only with a system like R/3 you get them bundled together.

And even Microsoft seldom was innovative, but it was always a good integrator. Microsoft software is not valuable because it implements things not found somewhere else. Microsoft's business was to present enough connected dots, so everyone could find something to use.

Re:As previously seen on BoingBoing

[IamTheRealMike]

Well, not really. Unless you consider "most" of the history of the human race to have taken place in the last three hundred years (a New Chronologist perhaps?) for most of human history there were practically no creative works, and what few did exist were usually religious in nature - paid for either by a totalitarian religious authority, or by believers own devotion.

Art, literature etc all started appearing during the renaissance, (or during the pre-dark age antiquity, depending which timeline you subscribe to) and were inaccessible to the vast majority of the population. Your Roman poet is a good example - he didn't care that somebody was copying his poetry because he wasn't relying on his poetry for his income. The size of the population who had disposable income to spend on poetry just was too small for it to be an issue. Anyway, a combination of illiteracy and expense of duplication meant that only the ultra-wealthy families like the Medici could indulge in owning books and paintings. The problem of copyright infringement didn't exist, because the scale was too small. As you note, fraud was the issue of the day.

The invention of copyright was triggered by "piracy" of books, effectively, and it happened only about four centuries ago. Even then, it would be a long time until the number of people making a living off of producing creative works was >1% of the population.

So what history shows us is not that artists can do fine without copyright. It's that it's possible to have the arts, as long as you have amazingly rich patrons willing to fund it, in which case not only would most of the creativity be oriented towards a 50 year old+ bankers tastes (forget Half Life!), but there'd be much less of it. We'd have an abundance of copies but a shortage of new, interesting things. Doesn't sound like a good deal to me.

Re:Simple

[vertinox]

A price. That cannot be avoided (ie piracy kills the value of objects and ideas).

Artists have been making work for centuries without often being compensated for their work and many eventually dying in abject poverty only to be recognized for their talents years after their deaths.

One could argue that if one could not make money off of art then only those really interested creating art "for the sake of art" would be doing so. If copyrights went away tomorrow, there would still be musicians playing on the street corner, photographers taking pictures, painters making paintings, and writers writer stories. Now granted there will be a lot less of them, but people still desire to create work for the reward in itself rather than a monetary return. That may be a good thing or bad things depending on how you view it but I think aesthetics will enjoy the fact corporations are no longer actively creating art and the average joe will probaly not like it because no one is making art he likes anymore.

Personally, I think the ideal solution was how things were back in the middle ages. If you wanted art, you commissioned someone to do it. If no one is willing to commission it then either you give away your works for free or don't make them. The key problem with the current system is that it derives art for profit which is sometimes shallow at best due to the fact its creating something to be consumed rather than observed as art. (Damn I sound like a turtle neck art snob with a glass of wine complaining about the sad state of affairs at the New York Art gallery, but I hope you get my point)

One more way.

[PopeRatzo]

vertinox, of course I agree with your assessment.

I have been using for a year now a "commission" model to make a living off of my music. Besides the more "traditional" methods of earning money as a musician and composer, I create one-of-a-kind works on commission. After an interview and rather extensive set of conversations, I create from 20-50 minutes of music and then give the work completely to the patron, no rights reserved. They could copy it and sell it if they want, but I never will. They could even put their own name on it if they want, but I warn them it will probably decrease its value (unless their name is Bono). So far, nobody has taken that route, though.

Oh, I also charge for this work on a sliding scale, based upon income and political orientation (I require proof of income, too). The prices have ranged from the cost of an evening out for two at the movies to 5 figures. It's sort of like the way the fine artists have always worked, and when I figure in my time and expenses, my price-per-hour is about the same as a low to mid-level painter or sculptor (but I'm just getting started).

As you say, if copyright went away tomorrow, there would still me music, books, even movies. Also, there will still be artists making a living at it, and in new and interesting ways. Creative people are supposed to be innovators, so why shouldn't that extend to the ways they monetize their efforts?

Ultimately, the price is less important than the value, to me. As long as I can continue to do what I love, what I have to do, I'm happy.

Getting paid for ever?

[serviscope_minor]

A comment on some opinions above, first:

I did an engineering degree at one of the top schools and I got a high mark, a first as it happens. I had to work very hard for 4 years to get that, and I had to pay to do it as well.

You know what sucks? People don't keep paying me since I'm a great engineer. I have to actually work to get people to keep paying me. How is this different from being an artist? I had to work very hard for years, and PAY, just to get to the position where I'm recognised. Now I can do things that the majority of other people can not. Maybe you don't think I'm creative enough and only really creativeness should be rewarded in this way. If this is the case, look around at some of the modern engineering wonders of the world. They're as much art as science (and fine examples of both). But people don't keep paying the engineers for the use of those works.

Now substitute any other high-end training/degree/education for the engineering degree I claimed above. Art is great, just like engineering. But it's not special.

Finally, I have nothing against people being stupidly successful and making vast amounts of money. What I mind is people whinging and trying to change laws so that they can make more money at my expense.

Work for a living, damn it.

And that's kind of what the article says: you will have to accept that copies are simply not scarse. No amount of wishful thinking will change that. You will now (as always) have to make money by providing things which are scarse. Like service, customization, support, trustworthiness, and so on.