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<title>Techdirt. Stories filed under &quot;benefits&quot;</title>
<description>Easily digestible tech news...</description>
<link>http://www.techdirt.com/</link>
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<image><title>Techdirt. Stories filed under &quot;benefits&quot;</title><url>http://www.techdirt.com/images/td-88x31.gif</url><link>http://www.techdirt.com/</link></image>
<item>
<pubDate>Fri, 25 Jan 2013 08:25:56 PST</pubDate>
<title>EU VP On Aaron Swartz: If Our Laws Hold Back Benefits From Openness, We Should Change Those Laws</title>
<dc:creator>Glyn Moody</dc:creator>
<link>http://www.techdirt.com/articles/20130124/08113621779/eu-vp-aaron-swartz-if-our-laws-hold-back-benefits-openness-we-should-change-those-laws.shtml</link>
<guid>http://www.techdirt.com/articles/20130124/08113621779/eu-vp-aaron-swartz-if-our-laws-hold-back-benefits-openness-we-should-change-those-laws.shtml</guid>
<description><![CDATA[ <p>As Techdirt has reported over the last ten days, the death of Aaron Swartz has provoked an outpouring of grief from friends and colleagues, who understandably wish to express their shock and anger at what happened.  You'd expect that.  What you might not expect is for a Vice-President of the European Commission to add her voice, but <a href="http://blogs.ec.europa.eu/neelie-kroes/aaron-swartz/">that's exactly what Neelie Kroes did this week</a>.  Her post is short, and worth reading in its entirety:

<i><blockquote>You've probably seen the terrible news about the death of Aaron Swartz. It's always horrifying when someone so young and so clearly talented feels they have no option but to take their own life. I know that this is something that shook the internet community deeply. And my thoughts are with his family, and what they must be going through right now.
<br /><br />
This was a man who saw that greater openness can be good for citizens, and good for society. Hugely disruptive -- but hugely beneficial.
<br /><br />
For me, the case is particularly clear when there aren't copyright issues, when information was already paid for by taxpayers, and when more openness can help new innovations and scientific discoveries.
<br /><br />
I would never condone unlawful activity. But in my view, <b>if our laws, frameworks and practices stand in the way of us getting all those benefits, then maybe they need to be changed.</b>
<br /><br />
Agree or disagree with his methods, Aaron could see the open direction we&#8217;re heading in, and its benefits. In the meantime, those scientists who are paying tribute by making their own work legally, openly available aren't just showing their respects -- they are also <b>benefiting scientific progress</b>.</blockquote></i>

Two points stand out there.  First, the one regarding information "already paid for by taxpayers".  That's a clear reference to the open access and open data movements, which seek to make precisely this kind of material available to all.   In fact, the point that openness drives innovation and scientific progress is mentioned by Kroes not just once, but twice in her short post.
</p><p>
The other notable phrase is that "if our laws, frameworks and practices stand in the way of us getting all those benefits [of openness], then maybe they need to be changed".  That's of a piece with her earlier <a href="https://www.techdirt.com/articles/20111121/07305616860/eu-commissioner-kroes-copyright-is-tool-to-punish-withhold-new-business-models-not-more-enforcement-needed.shtml">frank comments</a> about copyright being "a tool to punish and withhold, not a tool to recognise and reward," and her call for "flexibility in the system, not the straitjacket of a single model."
</p><p>
Given the stony silence from just about everyone in positions of power regarding Aaron Swartz's suicide, it's good that at least one politician had the decency to offer her condolences and admit that there's something seriously wrong with today's approach to sharing knowledge.  It would be even better if more of her colleagues came to a similar realization and expressed it with equal honesty.
</p><p>
Follow me @glynmoody on <a href="http://twitter.com/glynmoody">Twitter</a> or <a href="http://identi.ca/glynmoody">identi.ca</a>, and on <a href="https://plus.google.com/100647702320088380533">Google+</a></p><br /><br /><a href="http://www.techdirt.com/articles/20130124/08113621779/eu-vp-aaron-swartz-if-our-laws-hold-back-benefits-openness-we-should-change-those-laws.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20130124/08113621779/eu-vp-aaron-swartz-if-our-laws-hold-back-benefits-openness-we-should-change-those-laws.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20130124/08113621779/eu-vp-aaron-swartz-if-our-laws-hold-back-benefits-openness-we-should-change-those-laws.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>still-waiting-for-the-others</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20130124/08113621779</wfw:commentRss>
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<item>
<pubDate>Thu, 4 Oct 2012 12:13:24 PDT</pubDate>
<title>Not This Again: IEEE Plays Up Bogus 'Digital Sharecropping' Argument Again</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20121004/03134720590/not-this-again-ieee-plays-up-bogus-digital-sharecropping-argument-again.shtml</link>
<guid>http://www.techdirt.com/articles/20121004/03134720590/not-this-again-ieee-plays-up-bogus-digital-sharecropping-argument-again.shtml</guid>
<description><![CDATA[ Nearly six years ago, we wrote about the ridiculousness of Nick Carr's suggestion that Web 2.0 was all about <a href="http://www.techdirt.com/articles/20061219/160759.shtml">"digital sharecropping"</a>, in which online service providers are somehow "exploiting" users to take the fruits of their labors.  I would hope that, with six years of hindsight, people would still remember what a completely nonsensical argument this is -- based as it is on the economically clueless suggestion that the only possible benefit someone could get from using an online service is <i>money</i>.  Of course that's not true.  The <i>reason</i> that so many people use something like YouTube isn't because they're being exploited, but because it enables something wonderful and powerful <i>for free</i>.  Prior to YouTube, if you wanted to put up a video, you had to install complex or expensive server software, pay a ton for bandwidth... oh yeah, and hope that whoever wanted to watch the video had the proper software to view it.  YouTube took all of that away, and made it all free (and even added easy ways to monetize it).  If that's exploitation, sign me up to be exploited.  Similarly, look at a platform like Twitter, which has enabled amazingly powerful real time communications that has connected me with people worldwide in ways never before possible.  That's not exploitation. It's called providing something of value.
<br /><br />
So it's a shame to see the IEEE basically <a href="http://spectrum.ieee.org/at-work/tech-careers/from-surf-to-serf/?utm_source=techalert&#038;utm_medium=email&#038;utm_campaign=092712" target="_blank">rehash Carr's silly argument as if it were still relevant</a>, setting up a strawman about how "Web 2.0" (really, is anyone still using that term?) was all about empowerment, but the reality is that (*gasp*) there are companies involved.  And some of them... (wait for it...) <em>make money!</em>
<blockquote><i>
But the road to Utopia all too often ends up detouring through the business district, and Web 2.0 has been no exception. By offering the means of production free to their users, other leviathan sites, such as Facebook, Twitter, and YouTube, have generated enormous amounts of content at almost no expense. Even better, this content is a gold mine for targeted advertising.
<br /><br />
Over in Utopia, the &#8220;workers&#8221; who generated all those articles, photos, tweets, and videos would get a cut of the profits they helped to generate. In the business district, however, users retain their amateur status, while the companies they labor for rake in billions. Worse, contributors don&#8217;t even own the content they create. The smallest of the small print in the terms of use, which you must agree to in order to get an account, states that the company can use your content as it sees fit.
</i></blockquote>
Beyond the fact that this is a common misreading of the terms of service of most of the sites he's talking about (which merely request a license to make sure that their hosting of the content you put up is legit), author Paul McFedries completely ignores the tremendous value that people get for using those platforms... almost all of which is given out for free.  While economic value is often measured in dollar terms, that doesn't mean that people don't get value if actual dollars aren't exchanged.  The people using these platforms aren't being exploited -- they use them because they really, really value them.
<blockquote><i>
Anthony De Rosa, a product manager at Reuters, calls this digital feudalism and laments that we &#8220;are being played for suckers to feed the beast, to create content that ends up creating value for others.&#8221;
</i></blockquote>
And this is equally misguided.  <i>All sorts of things people do create value for others</i>.  Almost no economic activity is entirely contained so that only the person doing the initial activity retains 100% of the benefits.  Concepts like externalities and spillovers exist in economics for a very good reason -- and part of the problem is people who don't understand that creating excess value that benefits others is actually a core reason we have economic growth in the first place.  Creating value for others is <a href="http://www.techdirt.com/blog/innovation/articles/20120905/08542720283/why-open-doesnt-conflict-with-money-often-appears-to.shtml">of tremendous economic value</a>.  The problem is that people ignore the fact that those doing the creating are getting back more than enough value directly or <i>they wouldn't be doing the activity in the first place</i>.
<br /><br />
It's a shame that we're still having these discussions today, after we've had many more years of experience with all of these valuable services to recognize that it's not exploitation to get a tremendously useful service for free, while also increasing value for others.  It's actually how we innovate and grow the economy itself.<br /><br /><a href="http://www.techdirt.com/articles/20121004/03134720590/not-this-again-ieee-plays-up-bogus-digital-sharecropping-argument-again.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20121004/03134720590/not-this-again-ieee-plays-up-bogus-digital-sharecropping-argument-again.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20121004/03134720590/not-this-again-ieee-plays-up-bogus-digital-sharecropping-argument-again.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>make-it-stop</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20121004/03134720590</wfw:commentRss>
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<pubDate>Fri, 30 Mar 2012 07:33:18 PDT</pubDate>
<title>If ACTA Is So Great, Where Are All The Supporters Extolling Its Virtues?</title>
<dc:creator>Glyn Moody</dc:creator>
<link>http://www.techdirt.com/articles/20120320/08514918172/if-acta-is-so-great-where-are-all-supporters-extolling-its-virtues.shtml</link>
<guid>http://www.techdirt.com/articles/20120320/08514918172/if-acta-is-so-great-where-are-all-supporters-extolling-its-virtues.shtml</guid>
<description><![CDATA[ <p>One of the striking features of the ACTA debate is the deafening silence from those who are in favor of it.  Maybe that's down to the <a href="http://www.techdirt.com/articles/20120309/13371418054/dont-get-sopad-is-new-mantra-capitol-hill.shtml">SOPA effect</a>: companies and organizations are frightened of being associated with such an unpopular idea. Of course, it could just be that even its most fervent supporters can't really come up with any plausible justifications for it.  That's certainly the impression you get reading a rare attempt to raise the ACTA flag from the Institute for Policy Innovation, entitled "<a href="http://www.ipi.org/IPI/IPIPressReleases.nsf/70218ef1ad92c4ad86256ee5005965f6/17107bdf13dcd846862579bc006fea95">Acting Out on ACTA</a>."
</p><p>
It begins by focussing on potentially lethal counterfeits -- fake drugs, fake brake linings and fake circuit breaker boxes.  That conveniently ignores the fact that no one is against cracking down on such dangerous counterfeits, and that the main problems with ACTA concern its attempt to apply the same rules to digital infringement, where there are no safety issues to justify its harsh and disproportionate measures.
</p><p>
But leaving that aside, ACTA doesn't actually tackle the problem of physical counterfeits, for reasons I've <a href="http://www.techdirt.com/articles/20120308/09284118036/why-chances-china-joining-acta-tpp-are-practically-zero.shtml">discussed</a> before -- the main one being that the nations where fakes tend to originate are not signatories to ACTA, and so won't be bound by it.  As for the countries that have signed up, the principal ones like the 27 European Union nations, Japan and the US already have stringent laws that enable counterfeits to be tackled, so ACTA won't make any difference for them either.  The only countries where ACTA might have some effect are places like Mexico, and sadly the issue there is not so much fake drugs coming into America as the problems caused by <a href="http://www.fbi.gov/news/testimony/drug-trafficking-violence-in-mexico-implications-for-the-united-states">real ones</a>.
</p><p>
Rather than offer any more reasons why ACTA is a good thing, the IPI article then changes direction, and begins a bizarre attack on widespread concerns about ACTA's lack of transparency:

<i><blockquote>[Anti-IP activists] complain that ACTA was "negotiated in secret," and protest that critics did not have access to negotiators. Rather than making substantive arguments against the actual text of the agreement, they attempt to kill it by condemning the process.</blockquote></i>

In fact, plenty of "substantive arguments" against ACTA have been provided, for example <a href="http://www.edri.org/ACTAfactsheet">here</a>, <a href="https://www.laquadrature.net/wiki/Arguments_Against_ACTA">here</a> and <a href="http://action.ffii.org/acta/Analysis">here</a>, as well as <a href="http://www.techdirt.com/articles/20120213/09564217746/debunking-eu-commissions-myths-about-acta.shtml">these</a> on Techdirt.

The IPI article goes on:

<i><blockquote>it&#8217;s disingenuous to argue that agreements between governments must be negotiated in public with opposition activists in the room, and it&#8217;s na&iuml;ve for elected officials to fall for that argument. That&#8217;s not transparency&#8212;that&#8217;s paralysis. Treaties, defense compacts, and trade agreements have always been negotiated confidentially between governments.</blockquote></i>

But <b>no one</b> has argued that activists must be in the room.  Instead, people simply want access to draft versions of the treaty as they are negotiated, plus the ability to make their views known to their representatives.  That does not mean people are demanding the right to do that <b> in the negotiating room itself</b> -- that's plainly absurd -- just a mechanism for providing feedback, perhaps by means of the Internet.
</p><p>
As to the point that treaties have "always been negotiated confidentially between governments", that's also not the case, as <a href="http://arstechnica.com/tech-policy/news/2012/02/acta-is-part-of-a-multi-decade-worldwide-copyright-campaign.ars">this article explains</a>:

<i><blockquote>Ars Technica recently talked to Michael Geist, a legal scholar at the University of Ottawa, about this effort [to export restrictive American copyright laws abroad]. He told us that rather than making their arguments at the World Intellectual Property Organization, where they would be subject to serious public scrutiny, the US and other supporters of more restrictive copyright law have increasingly focused on pushing their agenda in alternative venues, such as pending trade deals, where negotiations are secret and critics are excluded.</blockquote></i>

So, far from being the norm, ACTA's secrecy is a conscious attempt to avoid the scrutiny and consensual approach that characterizes WIPO, the traditional forum for multilateral agreements in this area.
</p><p>
The IPI article concludes:

<i><blockquote>ACTA should be judged on its merits, not on some false illegitimate-process charge created by opposition activists. And its merits are many.</blockquote></i>

It's strange that an article that claims there are "many" merits of ACTA fails to mention them, and concentrates instead on attacking straw-men.  But there's something stranger still.  According to the <a href="http://www.ipi.org/IPI/IPIHome.nsf/Donation%20Content?OpenPage">IPI's donations</a>:

<i><blockquote>IPI is studiously non-partisan, but we have a definite philosophical opposition to Big Government solutions that are almost always worse than the problem. Today, the threat from Big Government is greater than ever, and our work is more important than ever.</blockquote></i>

ACTA is the ultimate in Big Government solutions -- in fact, it's even bigger than Big Government, because it's a <b>supranational</b> treaty that imposes an extra layer of obligations and bureacracy on governments, and hence their populations.  So the key question is not: Why can't the IPI tell us what those "many" merits of ACTA are? but: Why is it supporting it at all?
</p><p>
Follow me @glynmoody on <a href="http://twitter.com/glynmoody">Twitter</a> or <a href="http://identi.ca/glynmoody">identi.ca</a>, and on <a href="https://plus.google.com/100647702320088380533">Google+</a></p><br /><br /><a href="http://www.techdirt.com/articles/20120320/08514918172/if-acta-is-so-great-where-are-all-supporters-extolling-its-virtues.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120320/08514918172/if-acta-is-so-great-where-are-all-supporters-extolling-its-virtues.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120320/08514918172/if-acta-is-so-great-where-are-all-supporters-extolling-its-virtues.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>still-waiting</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20120320/08514918172</wfw:commentRss>
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<item>
<pubDate>Fri, 9 Mar 2012 05:56:00 PST</pubDate>
<title>Loosening The Privacy Reins Isn't So Bad, But Where's The Payoff?</title>
<dc:creator>Leigh Beadon</dc:creator>
<link>http://www.techdirt.com/articles/20120307/08451118012/loosening-privacy-reigns-isnt-so-bad-wheres-payoff.shtml</link>
<guid>http://www.techdirt.com/articles/20120307/08451118012/loosening-privacy-reigns-isnt-so-bad-wheres-payoff.shtml</guid>
<description><![CDATA[ <p>The Register recently published an interesting piece looking at the other, less-discussed side of the online privacy debate: what are users getting in return? Writer <a href="http://search.theregister.co.uk/?author=Matt%20Asay" target="_blank">Matt Asay</a> doesn't have a huge problem with ad networks tracking his behavior&mdash;or at least he wouldn't, if he was seeing <a href="http://www.theregister.co.uk/2012/03/02/online_advertising_and_privacy/" target="_blank">more of the useful, ultra-targeted ads he is supposed to get in return</a>:</p>

<blockquote><em>What grates on me is that for all the spying these companies do on my online behavior, they can't seem to serve me an ad for something I'd actually want to buy. Worse, they're terrible at delivering anything close to approximating a deal on the things I'd like to buy, even when I tell Google exactly what I want.
<br /><br />
What gives?
<br /><br />
For example, I ski a lot. And I spend a reasonable amount of time on Backcountry.com, Rossignol.com and other ski-related sites. Even the most rudimentary tracking technology should know that I'm interested in Rossignol skis (perhaps it would even know I bought two pairs of Rossignol skis this past year), yet when I type in "skis" into Google or even "Rossignol" into Google, the ads served up are for ... something completely different. Even the store that sold me my last pair of Rossignol skis &#8211; EVO &#8211; keeps trying to show me every kind of ski except Rossignol skis.
<br /><br />
... Come on, people: if you're going to track my online behavior, at least use it to get me to buy something I want!</em></blockquote>

<p>Asay feels that, based on his purchasing habits, advertisers should be able to figure out that he's loyal to Rossignol skis&mdash;but he could be encouraged to spend more money on them if he was targeted with ads for sale prices and other promotions. Instead, he's shown full-price retail listings for brands he's not interested in, pointing him to retailers he already knows about.</p>

<p>Now, in some ways this example is a little unfair, since it's only natural that companies are going to want to advertise to their competitors' customers, and not letting them do so would remove one of their biggest incentives for spending money on ads. But Asay still hits an important point: most targeted ads are <em>not that effective</em>. Online advertising as a whole already faces a public perception crisis in the form of privacy concerns, and they are never going to solve it if they don't put more emphasis on giving customers something in return for their privacy sacrifices.</p><br /><br /><a href="http://www.techdirt.com/articles/20120307/08451118012/loosening-privacy-reigns-isnt-so-bad-wheres-payoff.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20120307/08451118012/loosening-privacy-reigns-isnt-so-bad-wheres-payoff.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20120307/08451118012/loosening-privacy-reigns-isnt-so-bad-wheres-payoff.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>something-for-nothing</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20120307/08451118012</wfw:commentRss>
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<item>
<pubDate>Wed, 24 Nov 2010 19:39:00 PST</pubDate>
<title>How Do You Measure The 'Benefits' Of Copyright?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20101123/03020511984/how-do-you-measure-benefits-copyright.shtml</link>
<guid>http://www.techdirt.com/articles/20101123/03020511984/how-do-you-measure-benefits-copyright.shtml</guid>
<description><![CDATA[ One of the major problems we have with the way copyright law today is developed is how much of it is <a href="http://www.techdirt.com/articles/20100216/0234308176.shtml">faith-based</a> -- with supporters insisting that more stringent copyright law is obviously "better," without presenting any evidence to support that.  The history of copyright law is filled with examples of this sort of argumentation in favor of stronger copyrights.  Thomas Macauley famously (and quite eloquently) argued against such things in the UK House of Commons <a href="http://homepages.law.asu.edu/~dkarjala/OpposingCopyrightExtension/commentary/MacaulaySpeeches.html" target="_blank">160 years ago</a>, and his words still stand today.  Here are just some brief excerpts, though the whole thing is worth reading:
<blockquote><i>
 I believe, Sir, that I may safely take it for granted that <b>the effect of monopoly generally is to make articles scarce, to make them dear, and to make them bad</b>. And I may with equal safety challenge my honorable friend to find out any distinction between copyright and other privileges of the same kind; any reason why a monopoly of books should produce an effect directly the reverse of that which was produced by the East India Companys monopoly of tea, or by Lord Essexs monopoly of sweet wines. Thus, then, stands the case. It is good that authors should be remunerated; and the least exceptionable way of remunerating them is by a monopoly. Yet monopoly is an evil. <b>For the sake of the good we must submit to the evil but the evil ought not to last a day longer than is necessary for the purpose of securing the good</b>....
<br /><br />
... consider this; the evil effects of the monopoly are proportioned to the length of its duration. But the good effects for the sake of which we bear with the evil effects are by no means proportioned to the length of its duration. A monopoly of sixty years produces twice as much evil as a monopoly of thirty years, and thrice as much evil as a monopoly of twenty years. But it is by no means the fact that a posthumous monopoly of sixty years gives to an author thrice as much pleasure and thrice as strong a motive as a posthumous monopoly of twenty years. On the contrary, the difference is so small as to be hardly perceptible. We all know how faintly we are affected by the prospect of very distant advantages, even when they are advantages which we may reasonably hope that we shall ourselves enjoy. But an advantage that is to be enjoyed more than half a century after we are dead, by somebody, we know not by whom, perhaps by somebody unborn, by somebody utterly unconnected with us, is really no motive at all to action...
<br /><br />
The principle of copyright is this. It is a tax on readers for the purpose of giving a bounty to writers. The tax is an exceedingly bad one; it is a tax on one of the most innocent and most salutary of human pleasures; and never let us forget, that a tax on innocent pleasures is a premium on vicious pleasures. I admit, however, the necessity of giving a bounty to genius and learning. In order to give such a bounty, I willingly submit even to this severe and burdensome tax. Nay, I am ready to increase the tax, if it can be shown that by so doing I should proportionally increase the bounty. <b>My complaint is that my honorable and learned friend doubles, triples, quadruples, the tax and makes scarcely and perceptible addition to the bounty.</b>
</i></blockquote>
But, that, of course leads to the question of just what is the <i>benefit</i> that copyright provides.  If you talk to many of today's copyright system supporters, they will claim the benefit (or even the entire purpose) of copyright, is to provide remuneration to creators.  That, of course, ignores the basic history of copyright law, but even if we assume this is true, then copyright does not seem to serve that purpose.  After all, very few content creators get remuneration for their creations, and among those who do, fewer still get enough remuneration to make a living.
<br /><br />
In discussing how copyright law might be rethought, Cory Doctorow does a nice job <a href="http://www.guardian.co.uk/technology/2010/nov/23/copyright-digital-rights-cory-doctorow?utm_source=twitterfeed&#038;utm_medium=twitter" target="_blank">pointing out the extremes which disprove the common claims of copyright</a>.  After all, he notes, if copyright is about helping content creators make a living, then the "best" solution would be to simply award content creators a living wage.  So arguing that copyright is designed to serve that purpose is misleading.  Similarly, in measuring the overall impact of copyright, you can't simply add up the aggregate amount made from copyright -- as some copyright system defenders <a href="http://www.techdirt.com/articles/20100427/1646069201.shtml">love to do</a> with the oft-cited $1.52 trillion dollar number.  Doctorow again disproves that as the proper measuring stick, by again taking it to the extreme: if only one person were to make all that money thanks to copyright, no one would think that was a good program.
<br /><br />
So, how do you judge the benefits of copyright?  Cory's suggestion is the following:
<blockquote><i>
In my world, copyright's purpose is to encourage the widest participation in culture that we can manage -- that is, it should be a system that encourages the most diverse set of creators, creating the most diverse set of works, to reach the most diverse audiences as is practical.
</i></blockquote>
While this sounds nice, I still don't believe this is the proper way to measure copyright, either.  After all, one could easily take this to the same extreme and note that if we get the widest participation but, in doing so, it creates disincentives for great artists to create their works, is that the best system?  I'm not convinced that's the case either.  This is also why I think Cory's piece, which starts out so promising, goes somewhat askew at the end, in proposing a blanket music tax for file sharing -- an idea that I believe is actually <a href="http://www.techdirt.com/articles/20081209/0144083060.shtml">quite a bad one</a> due to serious unintended consequences.
<br /><br />
So I would posit that the way you judge the "benefit" of copyright is the way economists judge such things: you look at the aggregate <i>marginal</i> benefit across all stake holders.  That is, what is the marginal benefit to everyone in society from a specific change to copyright.  Does it increase output but decrease consumption?  Thus, you should be looking at not just if it makes artists better off, but by how much, and whether or not it makes others better off and by how much.  This may not be easy to measure, but it is how to best think about the impact of changes in copyright law.  Look at both the increases and decreases in "benefits" to everyone in the ecosystem and see which maximizes the overall societal benefit.
<br /><br />
This is also why I disagree with Cory's concept of "balance" -- a concept I have <a href="http://www.techdirt.com/articles/20071214/184433.shtml">argued against</a> in the past.  If you are striving for "balance," you are arguing for what everyone must give up.  Yet, if you are looking for the greatest marginal benefit, you are seeking the result where you are maximizing overall social benefit -- meaning, you are increasing opportunities for content creators to create and to make money, while at the same time increasing the social benefit that others can get out of their art  by consuming it, by sharing the experience associated with it, by building on it, etc.
<br /><br />
The goal should not be to "balance" what needs to be taken away or to just focus on one side of the equation (artists or "participants"), but to seek out what policies would actually maximize the marginal benefit to all.<br /><br /><a href="http://www.techdirt.com/articles/20101123/03020511984/how-do-you-measure-benefits-copyright.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20101123/03020511984/how-do-you-measure-benefits-copyright.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20101123/03020511984/how-do-you-measure-benefits-copyright.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>evidence-based</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20101123/03020511984</wfw:commentRss>
</item>
<item>
<pubDate>Tue, 24 Aug 2010 03:31:22 PDT</pubDate>
<title>Once Again, How Does DRM Benefit Anyone?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100819/04050510683.shtml</link>
<guid>http://www.techdirt.com/articles/20100819/04050510683.shtml</guid>
<description><![CDATA[ <a href="http://www.techdirt.com/profile.php?u=blinddrew">Drew</a> points us Shane Richmond's blog post about <a href="http://blogs.telegraph.co.uk/technology/shanerichmond/100005456/sorry-you-cant-open-that-book-here/" target="_blank">not being able to open legally obtained eBooks due to DRM</a>.  There's nothing <i>new</i> in this story -- which has been repeated thousands of times over the past decade or so, but it's just a reminder of the pointlessness of DRM and how the <i>only</i> thing it serves to do is to make the <i>legitimate</i> consumer worse off:
<blockquote><i>
Can we pause for a moment to remind ourselves just how absurd this situation is? It's been a problem for so long that sometimes it's easy to take it for granted but we are being sold products that work in one set of circumstances but not others. And there's no good reason for the distinction. It's not as if this is a piece of software that needs to be re-written for each new platform -- it's just text.
<br /><br />
The limitation is artificial and it's only there to prevent unauthorised copying but it's a wasted effort because anyone who intends to share these books can remove the DRM in no time. As always with DRM, it's the law-abiding customer who gets punished.
</i></blockquote>
It really is amazing that anyone still thinks DRM makes sense.<br /><br /><a href="http://www.techdirt.com/articles/20100819/04050510683.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100819/04050510683.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100819/04050510683.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>we're-waiting...</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100819/04050510683</wfw:commentRss>
</item>
<item>
<pubDate>Mon, 21 Jun 2010 11:22:43 PDT</pubDate>
<title>Updated Research Showing, Yet Again, That Weaker Copyright Has Benefited Culture And Society</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20100621/0933449895.shtml</link>
<guid>http://www.techdirt.com/articles/20100621/0933449895.shtml</guid>
<description><![CDATA[ Almost exactly a year ago, we wrote about a <a href="http://www.techdirt.com/articles/20090617/1138185267.shtml">draft version</a> of a paper from Felix Oberholzer-Gee of Harvard and Koleman Strumpf of the University of Kansas concerning the impact of weaker copyright enforcement on society.  It appears that they've now updated that paper and, as a whole bunch of you have been submitting, <a href="http://arstechnica.com/tech-policy/news/2010/06/file-sharing-has-weakened-copyrightand-helped-society.ars" target="_blank">it's finally getting some press attention</a>.  The full paper is embedded below, and is quite similar to the draft we discussed last year, but since so many people seem unfamiliar with it, we thought it was worth reposting the whole thing, and some key points from it:
<center>
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</center>
The paper looks at the <i>overall market</i>, rather than just the narrow market for direct sales of content, and finds, as we've been pointing out for years, that the increased ability to make, share, promote and distribute content hasn't hurt the content market at all.  In fact, the opposite has happened:
<blockquote><i>
Data on the supply of new works are consistent with our argument that file
sharing did not discourage authors and publishers. The publication of new books rose
by 66% over the 2002-2007 period. Since 2000, the annual release of new music albums
has more than doubled, and worldwide feature film production is up by more than 30%
since 2003. At the same time, empirical research in file sharing documents that consumer
welfare increased substantially due to the new technology.
<br /><br />
...
While file sharing disrupted some traditional business models in
the creative industries, foremost in music, in our reading of the evidence there is little to
suggest that the new technology has discouraged artistic production. Weaker copyright
protection, it seems, has benefited society.

</i></blockquote>
One of the key points that the paper makes is that many people have difficulty (especially beforehand) in recognizing whether certain products are substitutes or complements.  If products substitute for others (i.e., downloads take away from sales), then a market can be harmed.  However, if the products are actually complements (i.e., more content boosts other parts of the market), then a market can actually be helped.  The detailed research that Oberholzer-Gee and Strumpf go through clearly shows (pretty unequivocally) that file sharing is a complementary good that has <i>massively</i> boosted many different ancillary markets, and created a fantastic consumer surplus <i>without</i> actually decreasing output.  In fact, quite to the contrary, as noted above, creative output has risen at a dramatic pace.  And, when you actually look at the overall market, you see that the actual spend on these markets is increasing, not decreasing:
<blockquote><i>
The role of complements makes it necessary to adopt a broad view of markets
when considering the impact of file sharing on the creative industries. Unfortunately, the
popular press -- and a good number of policy experts -- often evaluate file sharing looking
at a single product market. Analyzing trends in CD sales, for example, they conclude that
piracy has wrecked havoc on the music business. This view confuses value creation and
value capture. Record companies may find it more difficult to profitably sell CDs, but
the broader industry is in a far better position. In fact, it is easy to make an argument that
the business has grown considerably. Figure 7 shows spending on CDs, concerts and
iPods. The decline in music sales -- they fell by 15% from 1997 to 2007 -- is the focus of
much discussion. However, adding in concerts alone shows <b>the industry has grown by
5% over this period</b>. If we also consider the sale of iPods as a revenue stream, <b>the
industry is now 66% larger than in 1997</b>.
</i></blockquote>
The report also takes on the policy questions, and notes (as we have so many times) that too much of the policy debate is on how to help a particular industry, which is not what copyright is intended to do at all:
<blockquote><i>
Copyright exists to
encourage innovation and the creation of new works; in other words to promote social
welfare. The question to ask is thus whether the new technology has undermined the
incentives to create, market, and distribute entertainment. Sales displacement is a
necessary but not a sufficient condition for harm to occur. We also need to know
whether income from complementary products offset the decline in income from
copyrighted works. And even if income fell, welfare may not suffer if artists do not
respond to weaker monetary incentives.
</i></blockquote>
From there, the report notes evidence that the income from complementary products has, in fact, increased while at the same time pointing out that artistic output is clearly not suffering.  While the report notes that further study on these issues is definitely required, it's amazing that so few people are talking about this.  I've brought it up to both the USTR and the IP Enforcement Coordinator, and neither seems inclined to care.  Both seem wholly focused on responding to the claims of industry lobbyists that <i>they</i> are being harmed.  But industry players failing to react is not the same thing as actual societal harm, and -- as we have pointed out repeatedly -- the entire point of copyright law is <i>supposed</i> to be about benefiting society as a whole.<br /><br /><a href="http://www.techdirt.com/articles/20100621/0933449895.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20100621/0933449895.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20100621/0933449895.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>good-news</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20100621/0933449895</wfw:commentRss>
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<item>
<pubDate>Wed, 5 Aug 2009 17:49:09 PDT</pubDate>
<title>Amie Street Also Takes Away Features... But At Least Is Honest And Upfront About How They Hate Having To</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090731/0311565725.shtml</link>
<guid>http://www.techdirt.com/articles/20090731/0311565725.shtml</guid>
<description><![CDATA[ We've covered how eMusic (which had a <i>fantastic</i> reputation for a while) totally <a href="http://www.techdirt.com/articles/20090629/1113025402.shtml">failed</a> in communicating changes to its service, which involved increasing prices and taking away many valued features.  The company tried to bury that news along with the fact that Sony Music would now be included, not recognizing that many of its users didn't care, and were pissed off at the way eMusic presented this as a good thing.  At least some others may be learning.  <a href="http://www.CardPlayer.com/">Ragaboo</a> alerts us that online music site Amie Street is also removing some features (such as the ability to redownload tracks -- just like eMusic has done), but did so by admitting that it sucked and apologizing, but basically saying its hands were tied.  They also gave advance warning of the changes.  While Ragaboo isn't thrilled about he, notes that he appreciated the honesty from the company.  Here's the email that he received:
<blockquote><i>
"In several weeks we're going to be making a change to how Amie Street handles downloads, and we want to be certain you are fully informed in advance about this change. In brief, starting on August 5th we'll only be able to offer a single download of your purchased music unless you've encountered a technical problem.<br />
<br />
Although most people only download their music one time, we've noticed that you have done so more than once on occasion. We realize that the ability to re-download files has been important to you, so it's understandable that you might be disappointed to see this no longer available. Unfortunately a number of factors beyond our control, including legal and royalty concerns, have made this impossible going forward.<br />
<br />
We're very happy to say, however, that you can continue to stream all of the music you've purchased on Amie Street. That means wherever you have access to the internet, you also have immediate and unrestricted access to stream the entirety of your Amie Street music collection from your Library.<br />
<br />
To make sure that downloading music continues to be as easy as possible, we'll be keeping a close eye on the user experience and making updates to the site as needed. The primary voice that directs any such changes will be yours, so if you have suggestions based on your experiences using the site, we'd love to hear from you. Tell us exactly what you like and don't like, and we can make Amie Street even better!<br />
<br />
Peace,<br />
<br />
The Amie Street Team"&quot;</i>
</blockquote>
Of course, the fact that both Amie Street and eMusic have removed the ability to redownload tracks over royalty issues makes you wonder what exactly is the issue here.  Are record labels really demanding a royalty payment every time people redownload a song?<br /><br /><a href="http://www.techdirt.com/articles/20090731/0311565725.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090731/0311565725.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090731/0311565725.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>take-a-lesson,-emusic</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090731/0311565725</wfw:commentRss>
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<item>
<pubDate>Tue, 14 Jul 2009 10:10:00 PDT</pubDate>
<title>The Psychology Of Externalities: Only I Can Benefit</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090713/0118575524.shtml</link>
<guid>http://www.techdirt.com/articles/20090713/0118575524.shtml</guid>
<description><![CDATA[ To understand the economics of the digital era, at some point or another you need to dig pretty deep into the issue of externalities -- a topic on which there's been a lot of recent research.  However, the traditional view of externalities is that these are economic "spillovers" that either benefit (positive externalities) or harm (negative externalities) third parties.  The traditional view is that too many externalities can lead to too much or too little of a good being produced, because all of the costs and benefits are not properly accounted for by those making the production decisions.  Some recent research begins to question that assumption.  And this becomes more and more important in a digital era, where externalities are less "spillover" and can, in some cases, be a <i>major</i> result of the good.  For example, the ability to make a perfect copy of a song for free may be seen as an externality.
<br /><br />
Either way, though, Clay Shirky recently brought up a point that touches on the <i>psychology</i> associated with externalities.  He was <a href="http://twitter.com/cshirky/status/2604735876" target="_new">talking</a> about the silliness of Mannie Garcia <a href="http://www.techdirt.com/articles/20090710/0159495506.shtml">claiming copyright</a> on Shepard Fairey's iconic poster, and noted that <a href="http://twitter.com/cshirky/status/2604919145" target="_new">people seem to view externalities quite differently, depending on how they impact them</a>.  For example, nearly the entire <i>benefit</i> of the photo that is being fought over was added by Fairey.  That is, the only reason that the photo has <i>any</i> significant value these days is because of Fairey's poster.  It's an externality from the poster.  And yet, rather than recognizing that it has received a <i>free</i> benefit, both the AP and Garcia want to <i>demand money</i> from Fairey for <i>causing the externality</i>.
<br /><br />
But, at the same time, the AP of course has no trouble profiting off the externalities of others.  The fact that people <a href="http://www.techdirt.com/articles/20090417/1544524544.shtml">make news</a> that allows the AP to report on it, is an externality.  The fact that tons of people are willing to <a href="http://www.techdirt.com/articles/20090708/1723035490.shtml">talk to reporters</a> and give them quotes and educate them is an externality.  The fact that the AP learns about some stories from other news sources or researchers its stories via Google or any internet technology is an externality.  And it has no problem benefiting from every one of those externalities, and would be quite upset at the thought that someone would come back later and try to charge them for it.
<br /><br />
And, yet, when it comes to the other direction, suddenly the AP says that no one else might benefit from externalities.  Only it may benefit from externalities.
<br /><br />
Of course, this is not just limited to the AP.  It's a common psychological problem when it comes to externalities.  Look at almost any dispute that's being caused by the modern internet and you can find someone who's upset about some externality not being "fair."  We see it with the blame being put by the entertainment industry on "piracy."  We see it with the blame being placed on aggregators and Craigslist by newspapers.  We see it in trademark, copyright and patent disputes.  And it's always psychological.  Recent behavioral economics studies have shown that rationality gets tossed out the window the second someone thinks that someone else is <a href="http://www.techdirt.com/articles/20080116/113123.shtml">benefiting too much</a>.  Even if you would benefit more yourself, seeing someone else apparently benefit <i>more</i> seems unfair.
<br /><br />
This thinking is both pervasive and dangerous -- even if it's natural.  It leads to a destruction of value (or, at the very least, a hindrance of it).  It focuses on pulling others down, rather than looking at how we can all, individually, be better off.  Both Mannie Garcia and the AP benefited greatly from Shepard Fairey's externalities.  But because they feel he benefited too much, they want to sue him.  And all that does is prevent them from benefiting from similar externalities in the future.  The same is true in pretty much every industry that we talk about.  It's as if people don't realize how much <i>they</i> benefit from externalities.  They assume that benefiting themselves is "normal."  But the second anyone else benefits, it's "theft" or a massive problem that needs intervention.  And that's a problem.<br /><br /><a href="http://www.techdirt.com/articles/20090713/0118575524.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090713/0118575524.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090713/0118575524.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>welcome-to-the-world-of-entitlement</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090713/0118575524</wfw:commentRss>
</item>
<item>
<pubDate>Mon, 29 Jun 2009 12:54:47 PDT</pubDate>
<title>If You're Taking Away Features From Users, Don't Tell Them It's For Their Own Benefit</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20090629/1113025402.shtml</link>
<guid>http://www.techdirt.com/articles/20090629/1113025402.shtml</guid>
<description><![CDATA[ Sometimes, I really wonder if companies think their users are stupid.  There are times when they treat them that way.  My favorite examples are when companies are taking away features or raising prices, and claiming (somehow) that it's for the benefit of those customers/users.  For example, when eMusic <a href="http://www.techdirt.com/articles/20090602/2250355103.shtml">raised prices</a> and <a href="http://www.techdirt.com/articles/20090624/0216435344.shtml">disabled features</a> it put up a blog post trying to spin it as a positive, claiming <a href="http://17dots.com/2009/05/31/more-of-the-good-stuff/" target="_new">"more of the good stuff!"</a>  Yes, at a higher price, with fewer features, but why let that get in the way of claiming good news?
<br /><br />
The latest example is online music streaming site imeem.  The company has struggled of late under absolutely draconian terms forced on it by the record labels.  Rumors held that the company came close to going out of business until Warner Music agreed to renegotiate its suffocating deal.  Still, there are many who question how the company can survive without a drastic change in business models.  But, taking away features from customers with little warning and pretending it's a good thing isn't exactly the best way to go about things.  <a href="http://twitter.com/cshirky/status/2348992497">Clay Shirky</a> points us to the news that <a href="http://blog.imeem.com/2009/06/25/simplifying-imeem/" target="_new">imeem is removing features for users to upload videos or pictures</a> without even offering a "download to save" option.  But, even worse, the blog post announcing the change tries to play this up as good news again, saying that it's all about "simplifying imeem" as part of an effort to enhance the site.
<br /><br />
Sure, simplifying a site can be a good thing -- but unilaterally removing features that people use, with little warning, isn't really simplifying.  You can simplify without removing features.  If you have to remove features, for whatever reason, why not at least admit the truth: it's not for consumer's benefit, but for some other reason, and you <i>realize</i> it sucks for many users.
<br /><br />
In other words, sound human, rather acting like your users are morons.  If you want to see a company that's actually done a <i>good</i> job of this, look at Hulu.  While we think it's ridiculous that the company caved in to content providers and tried (and failed) to block a specific browser (Boxee) from viewing its content, at least Hulu's CEO was <a href="http://www.techdirt.com/articles/20090218/1627113821.shtml">upfront and honest</a> about the fact that it sucked:
<blockquote><i>
The maddening part of writing this blog entry is that we realize that there is no immediate win here for users. Please know that we take very seriously our role of representing users such that we are able to provide more and more content in more and more ways over time. We embrace this activity in ways that respect content owners' -- and even the entire industry's -- challenges to create great content that users love. Yes, it's a complex matter. A tough mission, and a never-ending one, but one we are passionately committed to.
<br /><br />
For those Boxee users reading this post, we understand and appreciate that you're likely to tell us that we're nuts. Please know that we do share the same interests and won't stop innovating in support of the bigger mission. 
</i></blockquote>
eMusic, imeem and others would be wise to take note.  Taking features away and pretending your customers are stupid enough to believe it's for their benefit isn't likely to fly.<br /><br /><a href="http://www.techdirt.com/articles/20090629/1113025402.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20090629/1113025402.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20090629/1113025402.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>that's-called-lying</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20090629/1113025402</wfw:commentRss>
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<item>
<pubDate>Mon, 25 Aug 2008 15:42:00 PDT</pubDate>
<title>The Benefits Of Piracy Aren't Always In The Expected Places</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20080822/0336542063.shtml</link>
<guid>http://www.techdirt.com/articles/20080822/0336542063.shtml</guid>
<description><![CDATA[ One of the issues that comes up when we discuss the <a href="http://www.techdirt.com/articles/20070503/012939.shtml">economics</a> of infinite goods is people too often falsely define the product that's being sold as the market, rather than the <i>benefit</i>.  As we <a href="http://www.techdirt.com/articles/20080819/0314402026.shtml">mentioned</a> the other day, that's why the builders of horse carriages reacted the wrong way to the automobile.  If they had realized they were in the transportation business, the automobile would have been as an <i>opportunity</i> to provide a better transportation experience.  One of the side effects of properly recognizing the <i>benefit</i> is that it often shifts around the business model of the market you're in.  The money may end up coming from somewhere entirely differently than before.  The music industry is discovering this today (painfully).  The money isn't in the product itself (music) but in the scarcities made valuable by the product (concerts, access to the artists, creating new works, etc.).
<br /><br />
So, for folks struggling with these issues, one of the most important things to do after figuring out what your <a href="http://www.techdirt.com/articles/20070125/004949.shtml">real market</a> is, is to then figure out where all the <a href="http://www.techdirt.com/articles/20070315/013313.shtml">scarcities are</a> that are made more valuable by freeing up the infinite goods.  The trick is to then position yourself to capture money in <i>that</i> market.  But where this gets really tricky is those products may be surprising or appear to be in a totally different space (e.g., concerts rather than selling plastic discs) and that can be scary for those who are used to the old model.
<br /><br />
I've had a few folks submit the GameIndustry.biz <a href="http://www.gamesindustry.biz/articles/hollenshead-carmack-part-one" target="_new">interview with Todd Hollenshead</a>, the CEO of id Games, where he talks about the "hidden benefit" of piracy... but for computer makers, not video game producers. He's correct, other than the fact that it's not that hidden.  There's a very real and admitted benefit to computer manufacturers -- but that doesn't mean that there also isn't a benefit for the video game makers themselves.  Basically, when you look at the video game market, one of the big scarcities that benefits from free games is the computer makers.  
<br /><br />
But rather than somehow blaming them for not fighting piracy hard enough, why not take advantage of that?  Get PC makers to finance new games, pointing out that if they give out the games for free it will help drive more people to buy the next generation of high powered PCs that are needed to run the games.  In that way, everyone can benefit.  The PC makers (or maybe even Intel or someone) can pay for the game, and then use that to turn in more sales of high powered computers.  The video game developers get paid, the computer makers get a great tool to sell more new PCs and users get a free game with their PC.  Everyone comes out better off and there's no "problem" of piracy.<br /><br /><a href="http://www.techdirt.com/articles/20080822/0336542063.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20080822/0336542063.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20080822/0336542063.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>and-that's-not-a-bad-thing</slash:department>
<wfw:commentRss>http://www.techdirt.com/comment_rss.php?sid=20080822/0336542063</wfw:commentRss>
</item>
<item>
<pubDate>Thu, 21 Aug 2008 03:05:24 PDT</pubDate>
<title>Understanding The Difference Between Price And Value; Product And Benefit</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20080819/0314402026.shtml</link>
<guid>http://www.techdirt.com/articles/20080819/0314402026.shtml</guid>
<description><![CDATA[ Earlier this year, in response to yet another editorial somewhere where someone insisted that if something has a price of zero, it means that people don't think it has any value, we pointed out that <a href="http://www.techdirt.com/articles/20080121/19180527.shtml">price and value are two different things</a>.  Price isn't determined by value -- it's determined by the intersection of supply and demand.  Value plays into that, by determining what the demand part is.  That is, if I value widget X at $10, then I'd be willing to pay anything less than $10 for it.  If the intersection of supply and demand prices widget X at $5, it doesn't mean that I value it at $5, but it does make it likely that I'll buy it.  The same is true if the market prices it at $0.  It doesn't mean I place a $0 value on it.  It just means it's worth getting at that price, since it's below what I value it at.
<br /><br />
In the past few months, this discussion keeps coming up again and again -- and it's good to see folks pushing back and pointing out the difference between price and value.  The latest is Amy Gahran, over at eMedia Tidbits, where she takes a journalism professor to task <a href="http://www.poynter.org/column.asp?id=31&#038;aid=148910" target="_new">for asking whether journalism should even be done at all if people don't "find value in what we as journalists do."</a>  First, Gahran makes the point that, <a href="http://www.techdirt.com/articles/20071231/002429.shtml">historically</a> journalism has always been more supported by ads than people anyway, and then makes the price/value distinction:
<blockquote><i>
just because people aren't willing to directly pay cash for something does not necessarily mean they don't "find value" in it. For instance, when was the last time you personally chipped in for a clinical trial? And how are you paying for that air you're breathing right now?
<br /><br />
Some benefits are assumed to be part of the environment in which we exist. That's what it means to have an environment. If a benefit grows scarce to the point that people feel they must directly pay cash from their pocket to keep getting it, there's probably a far more dire calamity at hand than that single point of scarcity. Most people will almost always seek other free sources of a benefit first. 
</i></blockquote>
She then goes on to make another <a href="http://www.techdirt.com/articles/20070125/004949.shtml">favorite</a> point: too often, those in dying industries mistake the product they're selling with the benefit they're selling.  The horse carriage makers mistakenly thought they were in the horse carriage business (product) rather than the transportation market (benefit).  The best way to succeed is not to focus on the product, but the benefit you're providing your customers:
<blockquote><i>
I think it's important to bear in mind that people value benefits, not necessarily forms. The key benefit that journalists and news organizations have provided has been relevant, timely, accurate information that helps people make decisions, take action, and form opinions. For over a century we've established an ad-supported business model around packaging that benefit in a form known as "journalism." But that's not the only form this benefit can take, and many parts of the "American public" (and the advertising industry) are figuring that out.
</i></blockquote>
Good stuff.<br /><br /><a href="http://www.techdirt.com/articles/20080819/0314402026.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20080819/0314402026.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20080819/0314402026.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>let's-try-this-again</slash:department>
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<pubDate>Thu, 19 Jun 2008 15:15:00 PDT</pubDate>
<title>How Does Taking Away A Popular Feature 'Improve Netflix'?</title>
<dc:creator>Mike Masnick</dc:creator>
<link>http://www.techdirt.com/articles/20080619/0915391456.shtml</link>
<guid>http://www.techdirt.com/articles/20080619/0915391456.shtml</guid>
<description><![CDATA[ I am not currently a Netflix customer, but one of the features of the service that I thought was quite useful (and I know plenty of people who use it actively) was the "profiles" feature that let a single family/household set up separate queues of movies they wanted.  So, for example, a husband, wife and kids could each get their own list of movies with separate logins, rather than having to manage a single queue.  This made the service a lot more useful for a household.  And yet... <a href="http://tech.slashdot.org/article.pl?sid=08/06/19/0337233&#038;from=rss" target="_new">Netflix is eliminating the feature</a>, and doing so with the bizarre Orwellian <a href="http://www.netflix.com/Help?p_faqid=3962&#038;nlid=20427.1001179.0.1.0.0&#038;eid=T1qJaBtlETj5nvQncs6qHWvjUeo4PWZmJla2I78_SB*EY-">explanation</a>:
<blockquote><i>
Why? While it may be disappointing to see this feature go away, this change will help us to continue to improve the Netflix website for all our customers.
</i></blockquote>
Can someone explain how eliminating a feature that many people use improves the Netflix website?  You see, Netflix, if you're going to remove a feature and say that the website is better because of it, it would actually help if you explained <i>how</i> or <i>why</i> it's better (i.e., you're replacing that feature with something better).  To simply say that removing a well-liked feature makes the website better without any further explanation, you're basically calling your customers stupid because you think they'll believe what's clearly bogus.<br /><br /><a href="http://www.techdirt.com/articles/20080619/0915391456.shtml">Permalink</a> | <a href="http://www.techdirt.com/articles/20080619/0915391456.shtml#comments">Comments</a> | <a href="http://www.techdirt.com/articles/20080619/0915391456.shtml?op=sharethis">Email This Story</a><br />
 ]]></description>
<slash:department>please-explain</slash:department>
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