Open Source, Free Music Downloading, and Intellectual Property

“A day is coming, when, in the eye of the law, literary property will be as sacred as whisky, or any other of the necessaries of life.” —Mark Twain”

Inventors, programmers, writers, and musicians often get the same advice for the new Internet economy and the world of downloading and digital copying. The advice is to embrace new business models which give us exposure and access, maybe even fame or  cryptocurrency in place of boring old money. We can sell labor like consulting services and live performances, T-shirts and books too, but we better give up hopes of obsolete and shameful licensing fees and royalties.

Here’s the foremost legal theorist of the Free Software Movement insisting that the collapse of copyright law will be good for musicians too ( from Liberation Musicology published in The Nation magazine in 2001).

“This increase in efficiency means that composers, songwriters and performers have everything to gain from making use of the system of unowned or anarchistic distribution, provided that each listener at the end of the chain still knows how to pay the artist and feels under some obligation to do so, or will buy something else–a concert ticket, a T-shirt, a poster–as a result of having received the music for free. Hundreds of potential “business models” remain to be explored …  “

Back in 2000, when I started a software company,  I was advised to give away software and sell services. The argument was that my company would be known as the experts on what we had invented and customers would pay a premium for our work. Each user in the chain would know how to pay the inventor and feel under an obligation to do so and we’d be profitably exploring a new business model. Well, it seemed plausible enough at the time if you were not too smart (raises hand).  But it turns out that neither corporations nor consumers — the customers — are interested in this model.

Experience taught us that the business logic of corporate customers was not favorable to small company inventors who sold services. Our small business with a new product came with a certain level of risk that customers could reduce by asking some huge corporation to support the software instead of relying on a tiny startup. On the other hand, low wage consultants and competing venture funded startups could always under-price us particularly since we did all the work and bore all the cost of inventing and making the software. And to complete the picture, users in the chain who had money at stake were very quick to come up with convenient reasons why they did not have an obligation to pay us. Our ideas were,  according to them, wrong, obvious and well known, not new at all. Our personalities were lacking in charm, our sense of style was off, our demands unreasonable. Any competent engineer, we were informed, could reproduce what we did over a weekend. In short, we didn’t deserve payment of any kind. I have heard very similar justifications for copying music in similarly resentful tones.   People downloaded our code, rearranged it, and announced they had something better that owed nothing to our crappy inventions anyway.  We were left with a very small bit of the market – unusual people who were willing to take a chance. We met some cool people, but it was no way to make a living .

Professor Moglen was correct, however, in the sense that this system was very efficient for the big companies that used our work. Instead of royalties and licensing fees, they only needed to pay for labor in a market where everyone was undercutting everyone else. Big companies with brands, marketing power, distribution, large legal teams, and lots of different ways to charge can often find all sorts of ways to wring money from products  (“monetize”). In fact, the ways in which big companies like Amazon, IBM, and Google exploit free software both as users and contributors are fascinating for people who find innovative business models fascinating.  Record companies can offer low royalty payments to Spotify and make it back on equity, non-license fees, and sheer volume ( as David Byrne explained). They can even mass produce T-shirts. RedHat and Oracle can sell free software by leveraging marketing, brand name, and risk minimization. RedHat’s Bob Young used to have a standard speech explaining both that he, Young, was dumber than his audience of programmers and that Red Hat’s business was like ketchup where Heinz could charge a premium because of brand alone. The first part was an outrageous lie well crafted to appeal to an audience of egotistical and naive programmers, but the second part was true enough. Even IBM used to give away software back when it was essentially the only computer hardware vendor in the world. The software helped them sell hardware and kept competing software vendors from taking too much of the revenue stream. For that matter, selling bottled tap water can be a very profitable business for Pepsi, but only because it has the distribution channels and marketing reach. In the end, though, all this clever monetization   can leave artists and inventors who are not marketing wizards with a small share of the T-shirt revenue- if that.

Eventually we lost the faith, stopped releasing our code and started enforcing our intellectual property rights. Not everyone was happy. A high level corporate manager in a big company told me “we know about your technology and we understand its advantages but your patents make it awkward for us to use.” I asked what was awkward about paying a license fee, and he told me that his company was not about to pay license fees to some small time losers from nowhere. But here’s the important fact: Copyrights and patents, although they are often misused, can  make it more awkward for big companies to shift revenue from the artists or inventor’s pocket to the corporate pocket in the course of some “agile efficient monetization of the marketplace”. Efficiency is one of those virtues that depends on where you sit. It’s certainly less efficient for a giant corporation to devote time and effort to licensing technology from small companies or paying ungrateful artists for their music than to simply make use of it. It’s expensive for a large firm to vet a product from a small company for utility and possible legal exposure and, at least initially, low cost to just download something for free.

On the other hand, it’s a lot more efficient for an inventor, programmer, writer, or musician to get a royalty check than to sell T-shirts. More lucrative, anyway.

There are downsides to depending on other people to do the work for nothing, but they are downstream ones. A manager or programmer at a tech company would have received a chilly response  from her bosses a couple of years ago if she had explained that the company was depending on a minor component for logging, produced by some volunteer team, and  that the corporation  should go through all the effort needed to onboard that tiny team as a vendor and purchase and vet that software even though it could be downloaded for free. Years later, it turned out the software in question opened a major security hole in corporate firewalls and nobody who decided to download it for free was fired.

Property versus intellectual property

But is any of this morally correct? For many people software patents are bad, in fact, intellectual property itself is bad. One complaint involves the supposedly dubious status of intellectual property as property. The argument goes something like this:

“the owner of a digital recording or program doesn’t lose anything when a copy is made, unlike the owner of a piano or a bicycle who no longer has physical possession if ownership is transferred. You still have a recording of your movie or musical performance or program even if someone is letting people download copies for nothing. See – it’s not actual property.”

But even with physical objects, ownership and transfer is not really that simple. Suppose my family and I move into your house without your permission. You still “have” the house – the physical object is still there. If there is sufficient space or if it’s a rental house, you may not even be inconvenienced.  What you’ve lost is something far more abstract than a physical object. You lost a right to control use or to demand payment for use – exactly what the musician lost when someone pirated her song. And what about intangible property? Bank accounts, loans and other financial assets are intangible pseudo-objects that have less physical presence than a bunch of bits encoding a song or program. If your financial adviser embezzles your  retirement savings to bet on the dog track or your bank invents bogus charges that they deduct from your account, no physical object passes out of your possession but you’d most likely consider yourself deprived of something. What you were deprived of is a right to some money, itself a strange non-material abstraction. Property rights are all about fictional entities, pseudo objects, rights to forbid others to do something and so on – there is nothing specially unmaterial or spectral about intellectual property compared to other kinds of property.

We also heard that some kinds of IP are more worthwhile than others. It’s not especially surprising, I suppose, that these theories often seem to align with the financial interests of the person making the argument (me included, of course). For example, in Germany software patents are widely derided, but patents on pharmaceuticals (controversial elsewhere) are not. Germany is a net payer on one of those kinds of patents and a net payee on the other kind. Guess which is which. Similarly, I’ve had interesting discussions about software intellectual property with people who work for computer hardware companies and sincerely believe software intellectual property to be dubious at best. For them, somehow, a design expressed in a hardware programming language which is then converted into a recipe for computer chips can be worthy of  protection, but a design expressed in a different programming language that is then converted into a process for controlling the machinery that makes those same chips is different in kind. The most entertaining argument I saw, however, was from an enthusiastic supporter of free software who wrote an indignant email to me from his company account, lambasting my use of software patents. When I pointed out that his corporate employer owned a lot more software patents than we did, he explained that his employer was a commercial enterprise and my business was not. Musicians seem to often get these kinds of lectures too.

The internet changes everything

People also argue that the nature of the internet and of digital representations of music and programs and movies makes that old-fashioned copyright and patent stuff obsolete. Here’s Professor Moglen again:

“our world consists increasingly of nothing but large numbers (also known as bitstreams), and that – for reasons having nothing to do with emergent properties of the numbers themselves – the legal system is presently committed to treating similar numbers radically differently. No one can tell, simply by looking at a number that is 100 million digits long, whether that number is subject to patent, copyright, or trade secret protection, or indeed whether it is “owned” by anyone at all. “

No one can tell,  simply by looking at it, whether a particular block of land or house or apartment is “owned” by one private individual or another, though. Does simply looking at an automobile or a pile of I-beams or a basket of mangos, produce information on whether that object is owned, or leased, or stolen? There is nothing fundamental about a number that tells you whether it encodes a program or musical composition protected by copyright, or a method protected by patent, but there’s nothing “emergent” about a vat of chemicals or a ball point pen that tells you whether it embodies a patented chemical process or mechanical design. Ownership is not a physical property of an object or pseudo-object, ownership comes out of social relationships of human beings. Moglen continues:

” Like everything else in the digital world, music as seen by a CD player is mere numeric information; a particular recording of Beethoven’s Ninth Symphony recorded by Arturo Toscanini and the NBC Symphony Orchestra and Chorale is (to drop a few insignificant digits) 76749873424, while Glenn Gould’s peculiarly perverse last recording of the Goldberg Variations is (similarly rather truncated) 767459083268. Oddly enough, these two numbers are “copyrighted.” This means, supposedly, that you can’t possess another copy of these numbers, once fixed in any physical form, unless you have licensed them. And you can’t turn 767459083268 into 2347895697 for your friends (thus correcting Gould’s ridiculous judgment about tempi) without making a “derivative work,” for which a license is necessary.”

It’s illuminating to transfer this argument back to an older technology.

“Like everything else in the printed world, novels are mere sequences of letters; a particular printing of Fledgling might contain  “When your rage is choking you, it is best to say nothing.”, while “the banana company did not have, never had had, and never would have any workers in its service” is from One Hundred Years of Solitude. You can’t fix Octavia Butler’s anger or Garcia-Marquez’s antipathy to banana companies and make other copies of these sequences of letters for your friends unless you have licensed them.”

We had copyrights for written works long before there were those electronic computers and pesky binary numbers that are supposedly eroding the whole basis of copyright law. And, by the way, that line about “correcting” Gould hit home for me. If you think you can play the piano better than Glenn Gould, go ahead. If you don’t like his work, don’t buy it. If you want to be “creative” with it and distribute it, pay a license fee to his heirs. The concept of “derivative work” in intellectual property law is there because people were publishing “improved” versions of Mark Twain’s work too.  Intellectual property is important primarily because of the money, but it’s also important because it allows the people who create the product to exercise some control of how it is used.  Neil Young was able to prevent Spotify from using his music to promote disinformation because he owned the rights.  For our real-time software, one question I used to ask free software advocates was to explain why it would be immoral for us to forbid use of the software to control land mines.

Free software, public domain software, creative commons licenses – all of those can be good things. Irving Wladawsky-Berger’s recognition of how free software could help IBM’s business was pretty much brilliant although one could easily come up with more cynical formulations of his explanation.  I even agree with those who say music and inventions are never wholly original, but build on the accomplishments of others. Of course they are. None of that justifies compulsory pre-emptive “freeing” of creative works or inventions by consumers of that work who just feel like they know better or, more likely, that their corporate employer would find it easier. Commerce is all about incentives and the incentive of a corporate lawyer or manager to insist that the company should pay an individual inventor or small business because it is the right thing to do is not all that high, believe it or not. Same with the incentive of a consumer to buy a song or movie that can be downloaded for free. And when some companies find it more profitable to use your work without paying, that makes it even more difficult for people at other companies to argue in favor of cutting you a big check. If all your friends stream  new music from a company that systematically underpays artists, you tend to look like a chump for paying more. The same peer pressure operates in corporate purchasing. A lot of people actually want to do the right thing, but very few will buck the trend to do so.
And what’s the right thing?

“To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

The legal system of intellectual property is far from perfect. Actually, it’s scarily imperfect. Several times only dumb luck saved us being ground up between the vast resources of big companies and the vast expense of the legal system. But I was able to help create interesting technology, and get paid for it, and stay independent, because the much maligned intellectual property laws do something to protect inventors, musicians, artists, film makers and others who don’t want to work for a giant multinational, but do want to make things.

A free software advocate once told me that Mozart didn’t need copyrights. Years later I read Mozart’s letters and was appalled at how much time he had to spend groveling to wealthy sponsors.  And maybe those of us who are less talented than Mozart but also create works that other people want to use or listen to or read also should get paid by labor right, not because someone with money wants to be a sponsor. So when next you hear about terrible Disney and their apparently infinite copyrights on Mickey, or about some patent troll demanding to be paid, or some musician suing a streaming service, think also about those of us who just want to be paid when someone uses our writings, music, creations, and discoveries. Proudhon may have been right and property may be theft, but in a society based on thievery, it is quite convenient to have some property.

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YOUR GRACE, MOST WORTHY PRINCE OF THE HOLY ROMAN EMPIRE!

I will not presume to trouble Your Grace with a full description of our unhappy circumstances, which my father has set forth most accurately in his very humble petition which was handed to you on March 14th, 1777. As, however, your most gracious decision was never conveyed to him, my father intended last June once more most respectfully to beg Your Grace to allow us to travel for a few months in order to enable us to make some money; and he would have done so, if you had not given orders that in view of the imminent visit of His Majesty the Emperor your orchestra should practise various works with a view to their performance. Later my father again applied for leave of absence, which Your Grace refused to grant, though you permitted me, who am in any case only a half-time servant, to travel alone. Our situation is pressing and my father has therefore decided to let me go alone. But to this course also Your Grace has been pleased to raise certain objections. Most Gracious Prince and Lord! Parents endeavour to place their children in a position to earn their own bread; and in this they follow alike their own interest and that of the State. The greater the talents which children have received from God, the more are they bound to use them for the improvement of their own and their parents’ circumstances, so that they may at the same time assist them and take thought for their own future progress. The Gospel teaches us to use our talents in this way. My conscience tells me that I owe it to God to be grateful to my father, who has spent his time unwearyingly upon my education, so that I may lighten his burden, look after myself and later on be able to support my sister. For I should be sorry to think that she should have spent so many hours at the harpsichord and not be able to make good use of her training.

Your Grace will therefore be so good as to allow me to ask you most humbly for my discharge, of which I should like to take advantage before the autumn, so that I may not be obliged to face the bad weather of the ensuing months of winter. Your Grace will not misunderstand this petition, seeing that when I asked you for to travel to Vienna three graciously declared that I had nothing to hope for in Salzburg and would do better to seek my fortune elsewhere. I thank Your Grace for all the favours I have received from you and, in the hope of being able to serve you later on with greater success, I am

your most humble and obedient servant

WOLFGANG AMADÉ MOZART

 

DISCLAIMER: These views are my personal views.