What unit would you use to measure the value it provides, if not money?

"Apply that to every major opensource software effort, things like IDE's, servers, programming languages/compilers. If you were granted a monopoly (like some software companies are, eg. Microsoft with Android patents) would it allow you to make money ? Sure. Would it create extra value ? Nope. "

I don't understand the point you're making. Obviously somebody thinks Microsoft's Android patents are valuable, or they wouldn't pay to use them. What do you mean by "would it create extra value?"

"Government should never protect the producer."

At least we agree on something...

"Will the demand go away if you eliminate the IP laws ? No. So the producers will have to figure out how to create new business models that work in a new environment. "

That makes no sense. Demand existing isn't enough for something to spring into existence. You make it sound like other people slaving away to create music, movies, and software is your birth right or something.

I'm against quantifying it at all because, while useful, price is a very limited metric. There are numerous cases where you can increase the transaction sum and achieve 0 value increase, eg. monopolistic pricing in a market with inelastic demand or bad investing (destroying capital) or externalities, etc.

>I don't understand the point you're making. Obviously somebody thinks Microsoft's Android patents are valuable, or they wouldn't pay to use them. What do you mean by "would it create extra value?"

Nobody is "using them", in fact nobody knows what patents are in question, all that's known is that Microsoft forced different Android manufacturers to pay up for Linux kernel or they take them to court. That's textbook rent seeking. It's likely that Linux devs arrived at the solution independently (since IIRC it's unknown what patents are in question), or would have done so - so you can't make the point that without granting Microsoft a monopoly you wouldn't have Linux kernel.

>That makes no sense. Demand existing isn't enough for something to spring into existence. You make it sound like other people slaving away to create music, movies, and software is your birth right or something.

People choose to share their creations, once it's copied the copy is no longer their property. They can do whatever they want with their property but knowledge is a non-rivalrous non-excludable good (without infringing on excludable property of others) and creating artificial scarcities to sustain someones business model is ridiculous. Software can translate nicely to a no IP environment by SaaS, NDAs and open-source development financed by consulting. There are various routes for other industries, and many more can be created. I'm not sure about things like pharmaceuticals and maybe other industries have different conditions that would lead to catastrophic results, but that doesn't apply to software and entertainment, bankrupting Disney and Microsoft != bankrupting a company with 10 years of R&D in cancer treatment research.

I read your words, but all I hear you saying is "I want free media".

Do you fundamentally disbelieve in the concept of paying someone for the use/enjoyment of IP they produced?

"I don't think you should restrict sharing" is not the same thing as "I don't think you deserve to be paid". Find a business model that isn't based on prohibiting what everyone's mother has encouraged them to do since they were toddlers.

Sharing is good. Information flow is good. Impeding either of those things impedes human progress. Creation is also good, but modern technology proves it can be encouraged and compensated without strong arming society as a whole.

Also, for the record, I am not a music/movie/etc artist, and I do not hold IP.

All the media I consume nowdays is free, news, learning resources, youtube vids etc. Apart from going to cinema (but even that started to suck), and music from local bands that I pay for to support the artist. So nope, I don't want any media.

>Do you fundamentally disbelieve in the concept of paying someone for the use/enjoyment of IP they produced?

Do you pay for broadcast TV program or radio ? They are funded by advertising. Same thing with software, I don't mind paying for it, but if you expect people not to copy it - keep it on a private server and expose it as a service, or find some other model.

Dude, sell tickets to shows, sell merch at shows, don't perform unless paid before hand.

If all else fails, consider that maybe you don't have a product worth buying, and then improve or leave.

This point bears repeating. As a musician, like it or not, you're an entrepreneur. You can outsource your marketing and collections to a third party in exchange for a percentage of profit (or even in exchange for an advance on anticipated profits), but it doesn't make you any less of a businessperson.

Everyone reading Hacker News knows the statistics when it comes to startup success. Why would the music industry (or any artistic endeavor) be any different in this regard?

Make something people want, at a price they're willing to pay.

This is the failed model that leads to the kind of monopolies all too well known to artists like myself.. It's sure not the American model for entrepreneurship. This hits "business" business model is for the fucking birds, and this line "If all else fails, consider that maybe you don't have a product worth buying, and then improve or leave." is bullshit. Ask Mozart, Van Gogh, Stephen Foster and lots of other great artists who died penniless.

"As a musician, like it or not, you're an entrepreneur"

Sorry, I know this and I like it. And as an entrepreneur, what I hate about about the hits business model that started in music, and is making its rounds to software is that it's not a very healthy one -- it's a winner take all, zero sum game, ans it's naive to not understand that most successful business models cannot run this way. Yesterday music, today movies, tomorrow software.

TL;DR thank you so much for the lecture, hacker bro. When it comes to: "Make something people want, at a price they're willing to pay."

"why would" indicates you did not think about it but you just want to fit the arguments to your position. Answer is: why should it? Like everyone here on HN you should know that softwareland is not only filled with startups but that there are infinitely more ways to run a software company. Same with music. It's not about being Michael Jackson or starving poor.

I have seen all kind of spoiled brat arguments of entitled hard drive owners seen coming along here and they are in the end just that: sense of entitlement and "i want" spelled out in different forms.

Foremost I read it from the snarky tone with which BS "tips" are given like "sell you underwear", "if people don't pay just f* off" ... I was even reading from people who think that artists principally have no rights on their creations, others were going pseudo philosophical with "the bits of my hard drive are free", (Oh yes physical property is still sacred, can someone tell me why?).

And then to witness the shit storm breaking loose if a company uses designs of 37 signal. Then the wannabe startups come out of their holes, they already see their ios-apps floating around in freedom and not generating money anymore.

Here it is: If a content creator creates something it's at his will to decide what happens to it, if it's free, it's free. If he wants to be attributed or paid, then it be so. All else is not at your discretion. Running away with a 1TB hard drive full of downloaded content and then screaming "it's good for your resume" is just an insult. Not more.

This has got nothing to do with entrepreneurship. Apparently music motivates people to buy gadgets for several 100 bucks to have it 24/7, so let them take the free stuff, let them pay for the stuff with a price tag.

To paraphrase: consider it a product worth buying and pay or just leave.

As an aside: I do not make and do not intend to make money from music anymore and always have profited from very liberal use of copyright laws. But when I played copyrighted material I always made note of it and paid dues where applicable. Why is this such a difficult concept for the elite hanging out here? And why this kind of annoyed lecturing?

/rant ends.

Dude, sell tickets to shows, sell merch at shows, don't perform unless paid before hand.

You're an ass.

If all else fails, consider that maybe you don't have a product worth buying, and then improve or leave.

You're an ass.

cp ShohamsGreatestFlames.txt ShohamsGreatestFlames2.txt

Man, that was really really cheap. Free even.

"It costs money to duplicate and distribute licensed copies of other people's work."

Notice that I didn't say anything about licensed copies of other people's work. Duplication--the raw act as shown above--of digital data is effectively free.

Your profits derive from your ability to control the scarcity of your product, right? If a publisher licensed your music and stood next to you at your shows handing out your album for free, you'd be boned, right?

The fact here is that these people can and will make duplicates of your work, and there is nothing you can do to stop them. It's not costing them enough not to, and anything you do to increase that cost--pushing for rediculous prison terms, making blank CDs have a big tax, forcing ISPs to limit service, etc.--hurts society far more than your loss hurts you.

"And it's not information, it's art."

To my capture card in the studio, to my sound board mixing analog signals, to my microphone receiving vibrations in the air, reading a phonebook and playing a song are functionally equivalent. To the hard disk, the bytes look the same. Metadata about "art" or "not art" is lost in the medium.

There may be a great philosophical difference between art and information, there may be a moral difference about how one ought be treated as opposed to the other--but there is no practical difference, and getting paid is about getting practical.

I think you shouldn't write this off as "you're an ass". It's rough to hear "you likely won't get full payment for the product itself because it can be pirated", but that is the curse of massive amounts of processing power, digital information, and storage space. It doesn't mean you can't be successful, it just means that traditional cash cows such as prints/CD sales are harder get. You used to be able to record a song once, and sell that song indefinitely. Milk the cash cow. Now, in a world where you could potentially (but not likely) make zero due to piracy, you can't rest on your laurels with an awesome work. It's strange, and like I said in a different post, not unlike software, but in the end, you can fight the whole internet and increasing technology or adapt (or die).

Actually, in the UK, we do pay for it (BBC broadcasts, at least) through a TV license.

I'm all for free flow of information and such, and the abolition of software patents and other substantial types of patent reform, but this kind of naive radicalism against all IP protection dilutes any reasonable demands for patent reforms and makes any activism look like a joke.

When you make a movie you can fund it and distribute it as you please. But it's extremely selfish and arrogant to want to benefit from other people's expensive endeavors, for which they are requesting a small fee to view, and give jack shit in return. By viewing the material you are admitting that there is at least some potential value in it, but by refusing to pay for it you are basically saying the movie studios and artists and writers and others can go ahead and close shop already, because you don't consider their business model viable and refuse to contribute anything.

I agree nice entitlement complex you have going there.

I have no entitlement complex, as I've said already I don't mind paying for cinema tickets and I don't even use other commercial media. If you're referring to focusing only on consumers and ignoring what's "fair" for the producer, they you are right, but also fail to understand the point of a market system - consumers are entitled, the whole system is designed to satisfy their needs, producers are meant to fight each other to do so and get the best results for the least amount of money. So yes starving artists - you don't have rights that trump the rights of the consumer.

I'm pretty confused as to how you first define that you don't want to quantify it but then one sentence later make a quantitative declaration ("achieve 0 value increase..."). How does this work?

You sound like you know what you're talking about here. What you're claiming is that digital media is a public good. I can live with that definition. It's certainly non-rival, and in practice is fairly non-excludable.

You then go on to claim that companies should just find a way to survive without copyright. The problem with this approach is that the creation of these public goods will be far below the social optimum without some sort of market interventions [1].

I definitely don't think that aggressive copyright law is the correct way to address the free rider problem. However, I think that it's shortsighted to create a necessarily inefficient market. It makes sense that companies like Disney want longer copyright, as that's how they capture the positive externalites of their work, and are able to keep producing it. Someone who is politically savvy and trying to solve this problem would look through possible solutions to the free-rider problem [2] and use them to formulate a way that producers and consumers can both benefit from relaxed copyright laws.

[1] http://en.wikipedia.org/wiki/Public_good#The_free_rider_prob...

[2] http://en.wikipedia.org/wiki/Public_good#Possible_solutions

If your work is not going to enter the public domain then there's no contract - the state then is enforcing a monopoly against the interests of the people.

Disney can make a profit of 100s of millions on a movie within a few years. They don't need anything like as much as 20 years.

They will of course retain their trademarks, and I think this is only right in a realistic IP environment.

>relaxed copyright laws //

Relaxation general means less strict or less firmly applied. This suggests an assumption that the state should grant a monopoly - there should be no such assumption but instead the application of a strict limited time contract in accordance with the original purposes of the law.

That wasn't my intention. I wanted to emphasize that it already has. I think the state should work to ensure the creation of public goods and I think that they should relax copyright laws.

I'd love to read a rigorous analysis of this idea:

> Disney can make a profit of 100s of millions on a movie within a few years. They don't need anything like as much as 20 years. > They will of course retain their trademarks, and I think this is only right in a realistic IP environment.

At least we agree on something...

What is this madness??? I'm no Supply sider, but government does should and always will support producers. The question to me is only whether or not they'll just support monopolistic ones, or small ones and startups as well...

Value is a different thing to different people.

Money is not required for value to exist.

There should be no intellectual property. There should be fair reward for positive contributions to society. Reward not protect. Provide an incentive rather than a pay off.

At the moment, society is based on money not value. It's founded on providing as little value for as much money as possible.

Value is a different thing to different people.*

So... yes, then? I mean, that's the whole point of money: allowing different people to express their preferences in a way that allows comparison. You don't need money to know whether you prefer apples or ice cream, but you do need to express your preferences in some way that lets stores know whether to stock more types of apple or more types of ice cream, and price is just the simplest way.

That's hand waving. Specify how you propose to achieve this.

What is the legal framework you are proposing that would ensure that I would be paid a "fair" price for my work? What if my work is brilliant and millions love it? What if it's shit, and no one would pay me a dime for it? Who judges?

If there is not a "fair value" then it probably shouldn't be being done. If it's for personal interest, don't expect a fair value for it.

People expect and somehow manage to get money at the moment for shit which is the problem.

When you put something on the free market, you are opening it to opinion and other people deciding the value. Think carefully first.

Yeah no. We want money so that we have the fluidity of choosing a candy bar one day and a vacation another. Besides, you can't have someone offer you fractions of a vacation for your work. Is it truly that difficult to see where barter systems fail?

Besides, you are putting too much faith in the "fair value" idea. First off, when you want something and you barter with someone, a common technique is to disparage the quality of the item you desire. Why? To convince someone else that it isn't worth as much, that a "fair value" is less than that. Then, take the example of a mom-and-pop shop making jams and jellies. They probably have a lot of pride in their work and the price reflects their feelings of craftsmanship. They say, "Look at how good it is! How fresh, how pure!" -- they are trying to convince you that it is worth more than you initially appraised it at.

It's a conflict of interest -- it is in the best interest of the consumer to pay as low as he can, and it is in the best interest of the producer to get as much as he can. One seeks to minimize losses, the other, maximize profits.

Ever heard of donation-based bagel shops? You pay "what you think it is worth". Some people drop $5, others drop $0.01 because they want food and don't really want to pay for it. Even being glared at (social pressure) isn't enough to stop them.

The moral of the story is that people suck and asking them to "be fair" is a hilariously misguided way of getting revenue.

"When you put something on the free market, you are opening it to opinion and other people deciding the value. Think carefully first."

Yes, they can decide on a value, and so can the producer. If the values match or can be negotiated, you have an exchange. If they don't, then there is no exchange. Eco 101?

Edit: I'll add the most important one, too: time. I like my job, I like coding, but I also like to do things like ride my bike, spend time with my kids, and so on. The more money I have, the more I can choose to do those things (simplifying a lot).

Now, do you have something concrete to discuss or not?

Why are feet and miles the metric of distance, can't we just have near and far?

More seriously: value has to have a common unit of exchange. The grocery store clerk isn't going to give you your shopping for free because you happened to write some piece of software he isn't even aware of. Money allows value to be stored and transferred. Anything else is just warm fuzzies.

Much of mainstream economics reduces the broad philosophical concept of value to the narrow economic concept of exchange-value or price.

And it's not warm and fuzzy: what's the "value" of an unpolluted atmosphere? What's the value of good health? These things generally defy attempts to be priced (though what attempts have been made are risible), yet are fundamental - perhaps even more so than money - to a decent human existence.

You may disagree with the value placed on these things, or perhaps value them differently than "the average", but don't assume that their value can't be calculated.

I disagree that we'd be better off if they assumed the value was infinite. Under that calculus, anything that might possibly impact the atmosphere would be banned: things like energy generation of nearly any form, which most reasonable people would agree is of positive benefit.

There is a value to it, that value is hard to calculate, but unfortunately, 0 is much closer to the real value than infinity.

Sorry to be glib, but as someone who lives with a sane system of units and measurements, I can't help but point out the irony of your statement.

General Electric, Du Pont, Mobil, AT&T, Sun, Oracle, Microsoft, and Google certainly have been overshadowed by the powerful snowflakes of the world!

The supply chain is much more diverse and interesting than you think, and most growth comes from new starts that will become <250K a year top line revenue corporations. These are the kinds of businesses who buy licensed copies of Office for instance, adwords, and adsense ads as well...

EDIT: You didn't say shaped "for the better". :\

People who get uptight about independent artists having their works digitally copied probably don't realize that this is a good thing. It means they are popular, it means people desire them, it means there is a market just waiting for you. Maybe it is time for a live performance, a tour, a gig, an exhibition, etc.

People seem to be so obsessed with selling copies of our work that perhaps they are forgetting what it meant to be an artist before easy, direct, reasonably faithful, copying was even "a thing".

Digital art, like code, is too easily copied to be controlled. As a programmer, I've come to terms with this. That doesn't mean that I won't ever make money, it just means that I'd make less than if there was a DRM system for everything that criminalized all of my users (note: users, not customers). And I'm OK with this. Perhaps this not OK with everyone (from the RIAA to the self-important programmer/artist), but I see fighting "pirates" as counterproductive and a waste of resources.

I work as a programmer full time. I get paid to do in-house company development. We don't sell any software, we sell physical products. I get paid for my expertise and for my ability to fix issues immediately.

I work as an open sourcer whenever-time. My work is free. Not "GPL", not "BSD". Free. As in, go, take it. No copyright asserted. Public domain where exists. WTFPL. Companies can steal my work and make it their own. They can modify it and resell it if they choose. It's financial suicide, right? It is, until you realize that programming is a skill that has to be paid for. Companies can steal and modify code IF AND ONLY IF they have someone to modify it. That means they are paying someone to modify the code. That means a programmer is still getting paid. The question is -- why can't that be me? Maybe I need to advertise myself as being the person you SHOULD hire instead of diverting company resources on acquiring an in-house person who is vaguely familiar with my code. What if they need a fix NOW, not 3 weeks from when I plan to release the next version for them to steal? They can escalate the priority with $$$. There are too many ways to monetize this.

This leaves me in an interesting position then. I'm the creator, and I'm getting paid for my services and my knowledge. I'm not getting ANYTHING for my product. Easy conclusion: if your only value is your product, and your product is free (or can, via Copy/Paste, be made free), then you are worthless.

If you're an artist, you have it even easier. Music will pretty much always sound better live, pictures of sculptures will never do them justice, a video of a play will never be the same as a live performance where you can see and smell the sweat, and seeing the paint on a framed, rough canvas will never be the same as 1000 DPI print.

In a way, this digital revolution has expanded art's ability to spread (unwillingly or not) but has also put a spotlight on novel ways of collecting payment for art and taken things back to a more traditional role. Like it or not, it is the result of the ability to digitize information. Make your peace with this system; anything else is just creating problems.

Trust me, plenty of people thought Red Hat was crazy for "selling" Linux when you could just download the source and compile it yourself. Heh, turns out that building 10,000 packages using a 233 MHz CPU takes a few days, and isn't nearly as convenient as an autoupdate service that works on a whole network of PCs.

People who wrote Linux found a model that works without forcing other people to pay for it. They do rely on copyright to prevent "free riders" but even without it the financial model is the same, eg. FreeBSD, or any other non copy-left licensed opensource project that has a commercial story. It turns out that without software, hardware is pretty much useless, so even if you can't profit on software directly, you can expect things like OS development to be driven by hardware manufacturers.

Money they could earn if they had monopolies on OS kernels would be extremely higher - but market isn't about creating profit for the producers - it's about creating value for the consumer, and consumer would get the value even if he didn't pay for it - so they are getting screwed by rent seeking.

No, not in and of itself. It's a messy compromise. Things like software patents are pretty much just bad. Copyright, in a limited form, seems to be good. Patents on things like medicines can be good in that they pay for research. All of them should be more limited than they currently are, most likely.

Linux works, but who's to say it's 'optimal'? Given the huge amount of value it creates, I think relatively little filters back into the development of the system.

> consumer would get the value even if he didn't pay for it

If no one pays for it, the consumer will not get the value because the developer will have to do something else to make money, and will therefore not produce the code. Luckily, in the case of Linux, some money is funneled back into development, so it's not impossible, it's just much, much more complex than with "intellectual property".

And that's the crux of the problem. You seem to think that it's optimal if it puts money in to developers pocket. I'm saying it's optimal it provides more value for less cost to the consumer. Market is about consumers not about producers.

>If no one pays for it, the consumer will not get the value because the developer will have to do something else to make money, and will therefore not produce the code.

Where did I say nobody pays for it ?

If you want to develop software and charge for it you're still left with different options, you can deploy with contracts/NDA style to the Oracle type market, you can sell software as a service and keep the source private (you can do this even with games by streaming them), or you can do ad-based apps like Zynga and mobile guys, you have major copying in that space and very little copyright enforcement - it sucks for the developers but it works for the consumers. And there's doing on demand stuff, where the customers pay in advanced, and can subsequently opensource it to distribute costs of maintenance or even split the costs by forming alliances (I've seen this in energy sector where three big companies decided to standardize and share some data exchange software), regular consulting/maintenance approach, etc. And there are probably many other ways to make money without IP.

Demand still exists, you just need to find a way to profit from that demand without IP.

All I'm trying to say is that intellectual property is a legal monopoly on non-rivalrous non-excludable good, it violates the nature of innovation (incremental improvement and copying are essential) and copying as creating new value for free instead of stealing.

No, I'm saying that if no money flows to developers, it's suboptimal because consumers lose out too.

It has to be a balance, and IP has been a pretty good, if imperfect, way of achieving that balance.

That's not to say I don't think IP needs an overhaul. I do, however, think that IP is part of the solution and not just 'bad'.

But that's my point, Linux/Android, and by extension most of opensource, work mostly outside of IP protections and are able to match closed source and compete. I see no reason why Google wouldn't be able to use it's business model without IP. So even now it works, without IP the entire industry would be forced to restructure.

Again - the demand doesn't disappear - you just need to find new ways of satisfying it while making a profit. Just because it's not obvious and would cost a lot of companies their business doesn't mean it's a bad thing. Apple is sitting on billions of dollars in cash on hand and protecting "multitouch". Apple's profit is largely due to it's IP monopoly, if knockoffs and iterative improvements were allowed under different brands Apple's competitive edge after the first mover advantage wears off (and seeing how long it takes phones to hit the market with Android for eg. it's a significant window of opportunity) would be efficient production, more innovation and marketing, all of which create extra value to the consumer. So they would be forced to invest in product more aggressively, margins would shrink without innovation - you would have a more competitive market. Production would have to be restructured to even further protect trade secrets (which would screw cheap China manufacturers because they can't be trusted with IP sensitive jobs if they can sell knockoffs). Conversely they would need less to protect from legal threats.

It seems to be a tougher proposition for more 'end user' types of things. OpenOffice, if you recall, was created as a proprietary project, and only later open sourced, just as one example.

What your examples point to is a world where IP producers are forced to cozy up to someone who actually controls a scarce resource in order to benefit, rather than do so on their own.

(I do agree, BTW, that software patents suck and are not good, and destroy value).

(Also, BTW, "it's" means "it is").

"Why is money the sole metric of wealth."

is a) ungrammatical and b) basically a tautology. money is the sole metric of wealth because wealth, quantified, is money.

not trying to detract from the point you raise, just getting a bit OCD about logic and grammar.

Price/money is useful but the goal is to create value for consumers, not to suck them dry :) Profit is a market signal/reward for producers but that doesn't mean that it's == to value created for consumer (see my reply above about monopolies, externalities, etc.)

"A startup is a small company that takes on a hard technical problem."

The monetary value of "discretionary time" is the amount of money you could have made if you did something else instead.

More specifically, you can't always do something else revenue-generating instead, and nor would you want to. What's the value of spending time with your children? Can you see how some people would not accept any amount of money to displace all of that time, whereas some others may would (in cases of paid-for adoption / slavery)?

I think your outlook is lacking in a specific economic concept: utility.

Obviously, you can't be doing something revenue generating all the time. But for determining the value, that's the way it's done.

When you choose to hang out with your kids, you choose that over everything else you could have done. One of the things you could have done is earn money. You decided to give that up, so the monetary cost of doing what you did instead is the money you could have earned but didn't.

The market value of your time is, assuming you have a job or charge a consulting fee or whatever, is already determined.

If there is no price level at which a transaction will take place because the supply side values the utility of the commodity higher than any amount of money the demand side offers, then you cannot price it in terms of money.

What's the value of the Mona Lisa? You can't just go off and find some other painting(s), look at those prices, and come up with a number. The only way you can discover its market price is by testing the market: i.e. putting it up for sale and inviting bids.

A person's time is not substitutable; one hour in the morning is not equivalent to one hour in the middle of the night; and 24 hours of it every day is not equivalent to 24 times the price of 1 hour of it. It's not fungible. This limits your ability to put a monetary price on it.