From the category archives:

Intellectual Property

Open content business models

December 1, 2007

I’m at the Open Translation event, and we’ve just had a great session on open content business models. It was very useful, and interesting, and gave me lots of food for thought. I’ve been interested in issues of how we sustain open content for a long while. I was the note-taker for the session, and I feel like there are a lot of great ideas out there.

In general, it seems like most models depend on some sort of up-front funding, whether it be an investment or a grant, to fund the initial writing of a large amount of content. The problem of how do you fund the actual writing of content was not really addressed, and I think that is one of the harder nuts to crack. There was one interesting model was asking for pledges, and if the pledges got up to a certain amount, the content would be produced. But ongoing sustainability of already written open content seems to have been at least conditionally solved by a variety of folks in a variety of ways:

  • Training and consulting based on existing content
  • Generating revenue by doing print on demand, with a markup
  • Production of corollary items such as t-shirts
  • Hybrid model – most content is free, some content is closed, and paid for
  • Advertising on a site with open content
  • Corporate sponsorship
  • “Robin Hood” models: asking larger Northern organizations to subsidize the distribution of content for the developing world

This is very interesting fodder for my thinking about the puzzle that is how to make NOSI a strong, sustainable organization. The thing we have actually done the most of is write the primer, and I’ve got more ideas for types of open content that NOSI could get involved in doing, so these suggestions for business models are quite welcome.

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Economically, open looks better than closed

September 13, 2007

An interesting study was released yesterday by an organization called the Computer and Communications Industry Association (with heavyweight members like Google and Microsoft) which shows that fair use exceptions to copyright generate more economic benefit than copyrights themselves. Here’s a tidbit of a Infoworld report about the study:

By one measure — “value added,” which the report defines as “an industry’s gross output minus its purchased intermediate inputs” — the fair use economy is greater than the copyright economy.

Recent studies indicate that the value added to the U.S. economy by copyright industries amounts to $1.3 trillion, said Black. The value added to the U.S. economy by the fair use amounts to $2.2 trillion.

The fair use economy’s “value added” is thus almost 70% larger than that of the copyright industries.

The $4.5 trillion in annual revenue attributable to fair use represents a 31% increase since 2002, according to the report, which claims that fair use industries are responsible for 18% of U.S. economic growth and almost 11 million American jobs.

So, if fair use adds more economic benefit than copyrights – what would open source do? Well, we have some data from Europe:

FLOSS potentially saves industry over 36% in software R&D investment that can result in increased profits or be more usefully spent in further innovation.

ASAY: Importantly, these savings apply to everyone, not merely open source companies/developers. Open source isn’t biased in distributing its benefits.

…• Increased FLOSS use may provide a way for Europe to compensate for a low GDP share of ICT investment relative to the US. A growth and innovation simulation model shows that increasing the FLOSS share of software investment from 20% to 40% would lead to a 0.1% increase in annual EU GDP growth excluding benefits within the ICT industry itself – i.e. over Euro 10 billion annually.

The evidence seems to be growing. At least on a large scale, open is economically better than closed.

Update: Nick Carr thinks the fair use study is “a crock.” He has some good points. 

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The Wealth of Networks, Chapter 5

April 15, 2007

I’d taken a long break from Yochai Benkler’s The Wealth of Networks – I had a lot going on, and, well, it’s a really, really meaty read. But I picked it up again, and was in the middle of it around the same time as the discussions around the Journal of Information Technology in Social Change happened. And as I finished reading the chapter, it came clear to me that the chapter might well be Yochai’s two cents on our conversation (not that I’ve asked him, but some things seem kinda clear from this chapter.)

The chapter is titled: Individual Freedom: Autonomy, Information and Law. Basically, it talks about the kinds of ways that individuals live, and the kinds of things that increase autonomy, and things that decrease it. He starts out laying the framework: the networked information economy puts materials in people’s hands for action, it provides non-proprietary sources of communications, and it decreases the extent that people can be manipulated by those they depend on for communication. He then goes into detail into each of these ways that the network information economy increases autonomy.

There’s a lot in this chapter, and I can’t possibly do it justice – go read it. But what I want to highlight is his section on autonomy, property and commons. First, because it bears most closely on issues of open content in the nonprofit sector. Second, because it’s a set of concepts that are pretty new to me, and I found interesting, and the arguments compelling.

First, both markets/property and commons have something in common – the ability of people to have some amount of certainty that there is available to them a set of resources so they can, as Benkler says “execute plans over time.” I’d just say, live our lives, or in the case of nonprofits, accomplish their missions. But markets and commons create these certainties in different ways, as you can imagine. Markets are dependent on the willingness and ability of people to pay for goods and services, and are constrained in certain ways. Commons are also constrained in certain ways. He says:

Whether having a particular type of resource subject to a commons, rather than a property-based market enhances freedom of action and security, or harms them, is a context-specific question.

Basically, we have to take things on a case-by-case basis. There may be times (I’d say home ownership is a good one,) where a property-based market would enhance security and flexibility, and a commons-based resource might not. And there will be examples (see below) where the opposite is true. It is his opinion, and based on his arguments I agree, that a mixture of proprietary (market-based) and commons provides people with the most flexible set of resources leading to the greatest autonomy:

Given the diversity of resources and contexts, and the impossibility of a purely “anything goes” absence of rules for either system, some mix of the two different institutional frameworks is likely to provide the greatest diversity of freedom to act in a material context.

He goes on to say:

As to information, then, we can say with a high degree of confidence that a more expansive commons improves individual autonomy, while enclosure of the public domain undermines it. This is less determinate with communications systems. Because computers and network connections are rival goods, there is less certainty that a commons will deliver the required resources. Under present conditions, a mixture of commons-based and proprietary communications systems is likely to improve autonomy.

He thinks that if conditions change, including increasing peer-to-peer networks, and wireless mesh networks, a commons-based communications policy would increase autonomy.

Later in the chapter, when he talks about mass communications, he uses a great metaphor of storytellers. I won’t detail it here, because this is already getting pretty long. But it’s worth reading – it has to do with how free we are to tell our own stories, and to hear the stories of as wide a range of people as possible.

I think that his contribution to our discussion about open content in the nonprofit sector, would be that, since it is information (a nonrival good), and since information is both output (I write a whitepaper that people read) and an input (someone takes the information from that whitepaper, and updates it, or uses a piece of information about one of the specific aspects of that paper in another paper with a different focus) a commons-based approach is the approach that will provide the greatest security and flexibility. In other words, an approach that will allow nonprofits to best fulfill their missions, or in Benkler-ese “execute their plans.”

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Dialogue about JITSC, part 2: Open content models

April 9, 2007

This conversation is very interesting, and very useful.

Both Michael and Laura bring up some important points that I want to talk more about – the cost of providing good content, and ways to provide that good content in a way that is sustainable. There is no question that providing good content costs money – I have no illusions about that. And I do, very personally know that raising money in a traditional sense (from foundations, etc.) for producing content is difficult, and takes a lot of time. And I don’t think that we have all of the answers yet to solve this problem – but it’s a problem worth solving, a problem worth struggling with, and not just going down the path of least resistance.

I got on Michael’s case about this primarily because his journal is about technology and social change – and, as he had said, he’s made passionate arguments about the open content in the past. But ultimately, yes, I do think that all content that we provide to the nonprofit sector should be freely available, and under Creative Commons (or similar) licensing. That’s the only way to provide important information to nonprofits that need it – some have a hard time affording even nominal fees for that sort of thing.

There are all sorts of interesting models for providing this content in this way, while still providing sustainability. Providing the online version as free and open, and charging for a print version (obviously, above and beyond just the cost of printing it,) is one idea. The open source community has all sorts of good models to learn from. Ways to leverage open content to get folks to pay for more premium services – in this realm it could be for training, or webinars, or those sorts of things. I think revenue sharing is possible – asking nonprofits who have resources to contribute to allow the content to be freely available to all, for instance. Michael’s open bounty is a great idea, and I’d love to help in any way I could to make that happen. There are collaborative content generation models – spreading the work out among more people. I also had heard of the publishing model that Peter brought up – allowing the authors to provide open access.

Believe me, between working with NOSI to provide good content, as well as thinking about what I am going to do with that science fiction novel I wrote over last summer that I’d like to publish at some point (I realized that once I started this conversation, I forever closed off the option to publish it traditionally) I feel this issue very keenly, and very, very personally.

I do want to address Laura’s concern about expectations. She says:

But I’ll put an unpopular suggestion out there: I think we as a community also need to consider possible negative impacts of advocating that all content ought to be open. It’s already very difficult to pay for the effort of creating great content; if in addition we promote in people’s mind the idea that all content ought to be free, it’s hard to escape promoting the idea that no content is worth paying for. Which puts us in danger of tipping an environment in which it’s very difficult to support good content into one in which it’s downright impossible.

It’s an interesting comment, and I think that it doesn’t take into consideration the way that gift economies work. A system where all content were freely available and under a Creative Commons license is a gift economy – in the same way as open source software, or wikipedia works in a gift economy. And there are great examples of sustainable gift economies out there, and ways that the “real” economy feeds gift economies. I think that it’s always important to make clear in people’s mind the difference between free “as in beer” and free as in “information wants to be free.” There is an educational component to providing free and open content. And I think we have to think about the negative impacts of providing content only to those who can pay for it – increasing an already evident digital divide between nonprofits that have the resources to pay for these kinds of content, and those that do not.

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How do we do make change if we keep doing things the same way?

April 7, 2007

I had heard about this new journal a while ago, and it was sitting in some small corner of my brain, waiting for me to pay attention. I ran into an old colleague at NTC, and it came up, because he had been thinking of contributing to the journal, but decided that he probably won’t, for reasons I will talk about.

The new journal, the Journal of Information Technology in Social Change, is, I think, a needed part of our landscape of resources for the sector. And the editors, both of whom I respect highly, are impeccable in their credentials to pull this sort of thing off, and make it successful.

But then I looked deeper. The journal is, basically, business as usual. It’s peer reviewed (good), but it’s got a rather restrictive license, and the content is not freely available. The licenses are as follows:

Personal License:

If you have purchased a copy/subscription to the Journal with a personal license, this means that it is for your personal use. You may make copies for backup purposes or to allow you to personally use this report on more than one computer. You may also print copies, but not for circulation of any kind [emphasis mine].

Corporate License:

For most of you, we recommend a corporate license. If you have purchased a copy/subscription to the Journal with a corporate license, this means that it is for use by people within your organization. You may make paper copies for internal circulation. You may post it to your intranet, so long as access to that intranet is restricted to those who work for your organization [emphasis mine].

In other words, don’t make a copies for a workshop, or for a colleague who isn’t inside your organization, and definitely don’t make a copy for your mother to read.

But it’s a journal about technology and social change! This goes back to my constant refrain – the means are the ends. How can we talk about technology in social change, while, at the same time, publishing in a format that limits the availability of this knowledge to people privileged enough to pay for it? How can we talk about promoting change when we’re not pushing this content into the commons?

The Public Library of Science is a wonderful example of a reputable, respected peer-reviewed journal where articles are freely available to the public. They say:

Published research results and ideas are the foundation for future progress in science and medicine. Open Access publishing therefore leads to wider dissemination of information and increased efficiency in science …

Which is, actually, a very practical down to earth argument. Benkler goes further, and I go with him:

Information, knowledge, and information-rich goods and tools play a significant role in economic opportunity and human development. While the networked information economy cannot solve global hunger and disease, its emergence does open reasonably well-defined new avenues for addressing and constructing some of the basic requirements of justice and human development … More importantly, the availability of free information resources makes participating in the economy less dependent on surmounting access barriers to financing and social-transactional networks that made working out of poverty difficult in industrial economies. These resources and tools thus improve equality of opportunity. [emphasis mine]

I think it is incumbent upon knowledgeable leaders to provide models for how to do things differently – provide tools that foster social change in ways that foster social change, not in ways that help to sustain the status quo.

I invited Michael Gilbert to a dialogue about this, which he readily agreed to. Below is his response. We’ll be continuing this on each of our blogs, with cross-linking. Please feel free to join the dialogue, either in comments, or on your own blog. I’ll respond to Michael’s response in another post.

Thank you so much for wanting to start a dialogue on this issue.

I would like to respond in three parts. First, I want to say a few words about my enthusiastic support for the critique of closed licensing offered by Michelle by reflecting a bit on my past actions in this regard. Second, I want to lay out as clearly as possible the circumstance that led to a decision to use a traditional closed license. Third, I want to invite people to participate in a conversation about how this could be done differently.

As anyone who has followed my advocacy work over the last ten years will know, I am a fervent supporter of open licensing models as a profound public good. I started promoting the Public Library of Science to the readers of Nonprofit Online News as far back as December of 2002. I’ve praised the innovation of the Creative Commons licenses on more than one occasion, along with Lawrence Lessig’s other work and ideas. (I have in fact offered a great deal of content under Creative Commons licenses in the past and will no doubt do so again.) I have been a champion of openness of all sorts, including such things as open licenses and the destructiveness of DRM, in panel after panel in the nonprofit tech community for a decade. I have more than once written challenges of others similar to Michelle’s challenge of me and I must say that I can only hope that I’ve been half as courteous as she has been.

Before I explain the circumstances that led to our licensing decision, I want to make one thing very clear. Although the Journal was prepared in partnership with NTEN, I take full and personal responsibility for the decision to use a closed license. Katrin Verclas (the Executive Director of NTEN, for those who don’t know) was eager to know if there was any way to make it open and pushed hard for it. I am the one who, with the interests of the sustainability of my own small organization in mind, refused.

The question of licensing is a terrible dilemma for authors, readers, reviewers and publishers right now and I happen to be all of the above. I’m in an absurd position, personally. I want our efforts to reach the broadest possible audience and at yet on a gut level, I loathe the restrictive nature of the journal industry. At the same time, I have a small organization with an established based of customers that will pay for high quality information. (In other words, I have paying subscribers who have been waiting for this journal for months.) Most importantly, I have staff to pay. Thus, the journal has a fee, although we’ve done our best to make the personal rate much lower than the organizational one and in no case are we anywhere near some of the stratospheric prices of many mainstream journals.

I’ve watched open journals fumble along and when they publish at all it’s the result of great sacrifice on the part of the people publishing it. Some, that have a home in the extra time that some academics can spend on such things in their jobs, are almost sustainable. Others aren’t at all. I’m really not sure what the answer is. The overhead of finding sponsors for a small publication is enormous. We experimented with it briefly two years ago when we first decided to publish a journal, but we couldn’t make it happen. Is there a business model that will make this work? I’m really not sure.

Quite frankly, nothing would please me more than to find a way to finance the expense of the journal without fees for licensed copies. The licensing is a pain for everyone. It’s friction in the system designed only to create some financial accountability for the work involved in nurturing the relationships involved and husbanding the papers into the best form we can manage. Maybe the answer is to abandon that and just use the Internet for direct publishing by authors, but I don’t think we’re far enough along yet in developing network centric models that do what competitive selection, peer review, and editing will do. Maybe the answer is for a single donor to step forward and fund the next half dozen issues. Maybe the answer is some kind of quarterly bounty which, as soon as financial pledges reach a certain amount, the publication goes to open license (or maybe that’s when the next issue is commenced). I really don’t know. If you want to help figure it out, I would be very grateful.

To wrap up, I just want to say thank you to Michelle for jumping on this right away. (I only wish you had been at the panel for the Journal on Friday where we talked about our larger goals. The licensing issue would have been a good piece of that discussion.) The sector benefits from this sort of criticism and we’ll all be better off for it.

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The Wealth of Networks Chapter 4

January 12, 2007

I know you’ve been waiting for this. Here is, finally, chapter 4. This book is really good, but it’s also very slow going. It will take me a while to finish it, I think. I’m hoping to really read a lot of it in the next couple of weeks.

A note, for those of you that don’t read my personal blog: I’m moving on Tuesday, from California back to Massachusetts – a very long meandering trip that will take about a month (it’s a long story – read the blog). So I’ll probably be doing more blogging on my personal blog than on this blog, just because I won’t have lots of online time, and I’ll be more in a travel mode, than a thinking-about-technology mode. But I do have a bunch of things on tap, like continuing with Benkler, finishing my Open Standards series, and continuing the open source databases. I also have been doing a bit more thinking about what is, in some ways, the undercurrent of this blog: spirituality and technology. There have been some interesting ideas marinating, that I’ll share soon. OK, on to Benkler…

Chapter 4 is called “The Economics of Social Production.” In this chapter, Benkler is laying out an important argument: people engage with social production for a variety of motivations, and that it is possible to generate economically significant amounts of effort with motivations that are not economic. In addition, the increasing involvement of social production in market-based business will change the way that business is organized. His basic argument is summarized as :

“It is the feasibility of producing information, knowledge, and culture through social, rather than market or proprietary relations – through cooperative peer production and coordinate individual action – that creates the opportunities for greater autonomous action, a more critical culture, a more discursively engaged and better informed republic, and perhaps, a more equitable global community.”

I think that’s something we can likely all agree is a good thing.

First, he asks “why do people participate” – he talks about the simple economic models of human motivation – which assume that there are “things people want, and things they want to avoid” and those can be translated into money – a universal medium of exchange. He explains, with some great examples, of why these are wrong. “If you leave a fifty-dollar check on the table at the end of a dinner party at a friend’s house, you do not increase the probability that you will be invited again.” He then talks about the importance of social capital over money: “If you want to get your nephew a job at a law firm in the United States today, a friendly relationship with the firm’s hiring partner is more likely to help than passing on an envelope full of cash.” People would rather participate in some things for social standing and recognition, rather than money.

He then talks about feasibility and efficiency of peer-based production vs. market-based production, and comes up with this stunning statement:

“A society whose institutional ecology permitted social production to thrive would be more productive under these conditions than a society that optimized its institutional environment solely for market- and firm- based production, ignoring its detrimental effects to social production.”

His arguments are compelling, and interesting. He then talks about how social production has emerged in the digitally networked environment, and the ways in which it has interfaced with market-based production – using examples such as Red Hat and IBM. And he talks about how the relationship between users and businesses changes:

“Active users require and value new and different things than passive consumers did. The industrial information economy specialized in producing finished goods, like movies or music, to be consumed passively, and well behaved appliances, like televisions, whose use was fully specified at the factory door. … Personal computers, camera phones, audio and video editing software and similar utilities are examples of tools whose value increases for users as they are enabled to explore new ways to be creative and productively engaged with others.”

The nonprofit take-away came to mind for me was to think about the model of nonprofits as passive consumers of software, vs. nonprofits actively engaged in collaboration in a peer-production environment – they are more able to define clearly what that software looks like, and how it works for them.

On to chapter 5…

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End of year links

December 22, 2006

Here are a few links to round out the year:

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Open Standards Part 1: Introduction

December 8, 2006

So first a note. I’m again doing this horrible practice of overlapping series. I know that I haven’t finished my series on the Wealth of Networks – but I hit a snag in reading: my last papers to write for seminary, and transitions. So, once the papers are done, and things settle back down, I’ll plunge back into Benkler, and keep going.

In the meantime, something that’s been on my mind for years is the concept of Open Standards, and their potential value in the nonprofit sector. I think it’s a really good topic for a series, because it’s meaty, there’s lots to talk about, and there is some news in that arena, around Microsoft’s Open XML standard, which was just approved by a standards body, and Open Document Format, supported by Open Office, and others. I’ll talk more about that in part II.

So first, what is an open standard? Wikipedia defines it best:

Open Standards are publicly available and implementable standards. By allowing anyone to obtain and implement the standard, they can increase compatibility between various hardware and software components, since anyone with the necessary technical know-how and resources can build products that work together with those of the other vendors that base their designs on the standard (although patent holders may impose “reasonable and non-discriminatory” royalty fees and other licensing terms on implementers of the standard).

So what this means is that if a standard is open, it’s documented, and anyone can use it to create things. A great example of a standard is HTML. Any web browser anyone puts together can render HTML, anyone can write a file in HTML, anyone can write an HTML editor, and then someone can move that HTML from program to program. You can write an HTML document in Dreamweaver, then open it up to edit it in Mozilla, then open it up to edit it in a text editor, then …

An open standard (in the software realm) gives developers the freedom to develop applications that use that standard, and users the freedom to take their data wherever they want, or move their data from one application to another freely, because the applications speak the same language.

So what’s on my plate for this series? In the next post, I’ll talk about the document format war. After that, I’ll talk about identity standards (like XDI). I’ll talk next about microformats, then I’ll wrap it up talking about some possibilities for nonprofit focused open standards (like the seems to be deceased OPX.)

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Eben Moglen on Software

November 26, 2006

Watch this video. It’s interesting, and should make us think a lot about why to use open source software.

Thanks to Jon Stahl for the heads up.

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Open Source News

November 19, 2006

Here are some tidbits from the open source world that might be of interest…

  • Sun makes Java open source. This is a big one. A few components (like the compiler javac, and others) have been open sourced under the GPL, with the rest of the SDK to follow next year. Find details at the Open JDK Project.
  • Make has a kit for an open source mp3 player. Yes, open source hardware. Cool!
  • This is old news, but I’m finally getting to understand it. Some really big 800-pound gorillas (Microsoft and Oracle) are bullying their way into the open source sandbox. The Oracle issue is much more straightforward – Oracle unveils “unbreakable Linux” – providing support for Linux that severely undercuts Red Hat’s support prices. There are some interesting theories afloat about this one (a ploy to then do a hostile takeover of Red Hat?) The second was the deal with Microsoft and Novell. Basically, they have agreed to collaborate on technologies and support. Here’s the kicker. Novell is paying Microsoft basically protection money. Microsoft agrees to give Novell customers indemnity against any patent or IP challenges. Eben Moglen thinks that this deal will be dead in the water because of the GPL 3.0. I’m not so sure, since no software project has to choose to adopt 3.0. It does mean that there will be a lot to watch in the next year or so.
  • After you camp out, and fend off the violent hordes to get your Sony Playstation 3 – you can boot linux on it.
  • Watch this documetary on Net Neutrality:

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