Why copyright will survive

August 31, 2008 | Filed under: Uncategorized

I hear people occasionally calling for the abolition of copyright. Often they use the phrase ‘imaginary property’ to show their contempt for the idea. I have often debated with these people, and found it very frustrating. Many times, I am lectured on economics by them, and have them explain marginal cost to me, on the (false) assumption that price should equal marginal cost in the long term. (It doesn’t, because fixed costs must be repaid to make the enterprise worthwhile, and normal proft must be factored in as a reward for entrepreneurial risk). Anyway…. when debating it recently a great example struck me as to why copyright not only makes sense, but will continue to work even without scarcity.

MONEY

Money is the answer. Money is (just like copyright) a totally artificial construct. It’s a relatively recent invention in human terms, if you count early stone age man., and not all tribal societies even have it. It is a product of our technological society. Once you live in a grouping where you don’t know bob from dave, you need a way of knowing who has done what and who owes who what. Enter money!

A long time ago, we used precious metals as money, gold and silver and bronze coins. And even after we started to introduce paper money, we still had the money ‘backed by gold‘. You could, at any point, exchange the pieces of paper for gold. The transition was pretty smooth, and people soon went from valuing the pieces of paper just like they did the finite precious gold.

Now the obvious problem is that it is possible to just print money. And that’s what we do. It’s how it’s made. We don’t mine for gold any more, we just switch on the printing press. And very very naive governments sometimes try and do exactly that to solve problems. Now and school kid will tell you that printing money is a disaster because it leads to inflation (the money itself becomes valueless). And any idiot will realise that for a society with money to function, we have to have incredibly strong penalties against forgery, and go to great lengths to make it impossible. If tomorrow, someone found a way to print perfect, usable $100 bills, The economy would quickly fall apart.

Now of course, the government doesn’t let that happen. The notes are made using special paper from a restricted supply, the inks are also special. Holograms are embedded into the notes, and a magnetic strip is added. Special combinations of characters are added that photocopiers refuse to print…

You can see where I’m going by now. These are all methods of DRM. They are ways to ensure that you can’t make copies of your money. And they work, no doubt after huge expense and careful policing. Now think about the implications of this… Being able to copy adobe photoshop is worth a few hundred dollars. Being able to copy all music and games in their entirety is worth maybe a few thousand dollars a month from the advertising on your torrent site. A million dollars a year at most. Being able to copy dollar bills is worth billions, maybe tens of billions, maybe hundreds.

And yet we are constantly told that the battle that the pro-copyright lobby fights is unwinnable and doomed, despite the fact that their situation is a thousand times easier than the battle governments fight to control the integrity of their money supply. The DRM on money works, and works practically 100%, because of two reasons:

1) The DRM on a dollar bill does not vaguely inconvenience the user of the money in any way at all. and

2) Everyone understands and accepts that the government has to stop people being able to copy money.

Now one day, maybe, 1) will get fixed, I have no idea how, and right now its definitely not fixed, which is why I agree with the pirates and the anti-DRM lobby that DRM is more trouble than it’s worth. However, I do believe that we need to address 2) at some stage. I cannot see the reason why digital goods IP and money are not equal in this regard. They both are ways of ensuring value is fixed for something that in technical terms can be produced at almost zero cost (printing presses are pretty cheap, even secure ones).

I think this is a pretty strong argument, but never see it mentioned anywhere. Am I missing something really obvious?

(For anyone thinking this is a very different POV to earlier posts, I still stand by all my piracy response decisions regarding demos, pricing and DRM, but am still a firm believer in copyright. I understand the frustrations and justifications behind piracy, but I believe 100% that the producers o digital goods must be fairly compensated for their work.)

14 Responses to “Why copyright will survive”

  1. SR says:

    One slight problem with this analogy is that DRM is part of what makes the money work. Paper money has value precisely *because* it is scarce and hard to duplicate. If it were easy to copy, people would abandon it and return to precious metals or move to something else harder to forge. It’s not just an aspect of paper currency, it’s a *feature* of it, one that its users require in order to be able to get any benefit from it.

    For the end user, DRM isn’t a feature of Photoshop. Nothing any user wants to do with Photoshop requires DRM or benefits from it. At best it’s a necessary inconvenience.

    I’m not arguing against DRM or copyright, just that your analogy isn’t quite apples to apples.

  2. some guy says:

    I can touch money

  3. Thomas A says:

    One potential problem I can see with this argument is that by illegally printing and using money you are decreasing the value of the currency, hurting others. By pirating software you are not directly hurting other users or the developers (although they loose potential sales and all that.)

  4. LN says:

    Why did you use a dollar bill? You’re English, right? Your money is the best in the world!

  5. Reliant says:

    The reason there is “DRM” in the currency is not so that people can’t make a copy. Making a copy of the currency doesn’t have any effect at all on society. It is the passing of the bill as real money and putting it into circulation that causes the problem to society and degrades the value. The protections are there to help people identify the real ones from the fake ones.

    In terms of software, it isn’t making a copy for yourself that’s the problem, it’s putting those copies back into circulation where they compete against the original.

    The key difference between money and software. People acquire software so that they can use it for themselves. People acquire money so they can use it on others. Because of this, the purposes in the copy protections have different goals.

    Another difference is that copyright is a time limited monopoly to allow the holder to recoup their investment. Because there is virtually no cost in making a copy, there is a benefit to society if, after a time, the item becomes public domain, and anyone can make a copy at their own cost. This allowed the creator to make money from their work, and the time limit also gave them reason to continue making new content. Now with the huge extensions on copyrights, some corporations keep milking the same old stuff hoping to continue making back even more money on the backs of society. Copyright is vital, but it needs to be balanced against fair use and the public. The idea wasn’t that you “own” the work, the idea was that you owned the time limited exclusive right to make copies, while the actual work belonged to whomever bought it. This is because copyright stems from the times when it was considered normal to make a copy of something, because making a copy was an intensive process involving a scribe and a quill.

  6. cliffski says:

    It’s easier to find a dollar image than a pound! (weak excuse).
    The comparison isn’t watertight, I know, but I think it’s an interesting point to show how people claim that you can never stop people reproducing something technically copyable, whereas clearly you can, if it is in everyone’s interests (except the criminals).

  7. Interesting argument. Hm…

    There are a couple of problems with the idea:

    – Different Goals: If you are an artist you want your work to be spread as much as possible (without starving of course). If you are a federal bank you don’t really want everybody to have plenty of money – on the contrary.

    – Money can’t be used but can be exchanged. As a customer, you can’t re-sell digital delivery products and they are generally meant to be USED.

    – The Value of money is not fixed but dictated by the demand. If you are selling your game you dictate how much your game is worth.

    The last two points are the reason why “Everyone understands and accepts that the government has to stop people being able to copy money”. That’s because everybody OWNS money and wants to exchange it for other things (like games!). If there are people out there who print their own money then that’s obviously unfair because they would be able to exchange all that money for all those wonderful things and not having to work for it. Also, it means that the value of your own money is depreciated and you will not be able to exchange it so well.

    Also, the copy protection on bills is far less effective then you might assume. I had a interesting discussion about it with a toy store owner recently. And let me tell you: if you think piracy is frustrating, try finding out that a bunch of money you thought you had turns out to be completely worthless. Now THAT’s stealing.

  8. gabbe says:

    “- Money can’t be used but can be exchanged. As a customer, you can’t re-sell digital delivery products and they are generally meant to be USED.”

    mm,never seen some drm on bills stop me from using it the way I want,fold it in my wallet.fold it to a paperplane and playing with it,put it in my vault, or safe or leave it at a friend.
    I don’t need to take care of some other papers with digits on them to be able to use my money. If they break,and you can get your hands on atleast 60% on them you get a totally new shiny one for FREE,just go to a bank and they check it themselfs or send it to some experts that puzzle it togheter,ever gotten a new cd for free if your kid scraches it? I doubt it.
    Had a friend buying some horsegame for their kids that was windows95 safe(was a long time ago) turned out it wasnt, she went back to store,they refused to take it back due to it being opened, gave her adress to the company and sent her away.
    She contacted them and they said it was a known issue,and wanted her to send it recommended to them and pay 225 for a new one,the full price was 399.
    So her response was not to pay more than half the cost again but to ask some friends teenage boys if they could fix it for free.
    They could.
    My point is bills drm is all about stopping copying of the bill,and making it easy to use. Games drm is on computers,and what one make another crack,so it has become more of stopping people from using the game in any other form than what the makers want AND the computer it’s on.
    Thus spreading outside of it’s perceived area,that’s what makes IP overall feeling too intrusive, atleast IMHO.

  9. >ever gotten a new cd for free if your kid scraches it? I doubt it.

    Actually, you do. Even games magazines offer such services for their cover CD-Roms. You horse game story is unfortunate but rather an example of an unserious company then anything.

    And copy protection on money isn’t perfecr either. For example when a vending machine refuses to accept a coint or a bill.

    “never seen some drm on bills stop me from using it the way I want,fold it in my wallet.fold it to a paperplane and playing with it”

    Ever tried to fold a coin? ;-)
    Or to DRAW on a bill?

    And yes, you can also use an DRM protected CD-ROM as a beer coaster. What’s your point?

    The analogy is simply wrong. Money has no use in itself. It is only there to be exchanged. So copy protection is much simpler since there is no function that could be diminished.

  10. Ivan says:

    The key difference between protecting money and software from copying is the diversity of the later. One government can protect one currency, but there are tons of different software packages and they are changing every day. Imagine that you have different bills for buying bread and sugar and a whole different currency for buying gas. Further imagine that each company prints it’s own money. Will the government still be able to protect all of it from forgery?

    Another point is that most of monetary exchanges now are done electronically – where you don’t have a copy of money and only issue “commands” what to do with your account. It is a “money as a service” analogy to “software as a service”. You can’t copy gmail because you don’t have a copy of it and you won’t copy your credit card because it won’t double your money.

    Recently I sent you an e-mail offering new technology of selling software without DRM. Please take a second look. For whatever reason the reality is that governments do protect currencies and don’t protect software good enough.

  11. Luke Maciak says:

    Here is the difference:

    Money = special paper, watermarks, security threads, special printing paint, special design etc.

    The money is the DRM – the DRM makes it what it is. It doesn’t only prevent copying the money but actually creates the identity for your bills. It makes them unique. When you counterfeit money your not trying to remove DRM but to duplicate which is hard.

    Also, money is made to be used and copying money is not part of their core functionality.

    Software = 010101000101001001001001

    Do you see the pattern here? Software is made to be copied. You have to copy it to your hard drive when you install it. Then parts of it get copied into your memory when you use it. Copying as a whole or in parts is the core functionality of software – it works because it can be copied.

    Furthermore if you remove DRM the software doesn’t lose identity – it remains perfectly usable. Thus someone out there will probably figure a way to remove it.

    I submit that designing an unbreakable DRM is virtually impossible because the concept of DRM is not cryptologically sound. The Bob, Alice and Eve analogy breaks down when Alice and Eve are the same person. Every year copying data becomes easier and more straightforward, and protecting it becomes more expensive and more annoying to the end user. We have already reached a point where custom made DRM schemes that cost millions to develop get cracked even before the product gets released to the public.

    I think you are right though – I think that copyright will survive but not due to DRM because as you have seen yourself it does not work right now, and I doubt that it ever will.

    It will survive because people still want to take credit for their creations and ideas, and get paid for them. People object to the term “intellectual property” because it has the word “property” in it. Property implies properties of physical objects – and thus things such as scarcity. Software on the other hand is more akin to an idea rather than to property.

    An idea is your property, until you tell someone about it. Then you can no longer claim exclusive ownership of that idea. You can claim to be the original author and request to be compensated if someone uses that idea, but you cannot ask someone to give the idea back to you and erase it from their memory.

    Trying to “protect intellectual property” is fruitless because you are working with a flawed assumption that ideas can be treated as physical property. Instead we should be thinking how to facilitate exchange of ideas in a way that adequately compensates their creator for his/her effort.

    Copyright will survive because a lot of people still believe in the old maxim of “you get what you pay for”. So when they pay for software they expect convenience, easy installation, no hassles, support and etc. When they download a torrent they are gambling on an unknown and get a product that may or may not work – or if they are not careful may turn out to be a virus.

    DRM is destroying this notion however. Look at what happened to Spore. People who pirated it are happily playing it and enjoying the experience. People who bought it are still waiting to play it because the activation servers crashed.

  12. Larna says:

    Actually, there is some small tiny inconveniance with the DRM on money on occasion :)

    Some places will use those special currency markers to draw a small line on the bill to see if its legit. This takes only a couple seconds :)
    Or some people who get large bills will hold them up to light to check to see if they have the strips in them. Etc.

    Its the equivalent of a server checking your cd key when you enter a multiplayer server to play online, its really not noticible and is done as part of the process of connecting to server usually (like the money check is done as part of the payment process).

    Now maybe those money pens are inaccurate, or not used outside of USA or anything, I dunno. Just thought I’d throw that out there.

  13. ludovico says:

    Your analogy does somewhat ignore the fact that the whole financial industry is currently tumbling off a cliff, precisely because banks have been trying to make a profit out of assets that don’t exist.

  14. tiotags says:

    The difference between money and copyright is that most people use money while not a lot of people use or need copyright (or at least not the pirates) so you still need to give them more reason to respect other peoples intellectual property