Pay to Play in Information Markets

[Nomen Nescio]

George MW writes:
> I played around with MN for a while, one of the things that
> disapointed me was that you tend to lose mojo just by
> running the client.  It seemed to me that the idea that
> everything you do should involve a cost one way or another
> was a mistake, it seemed to me that the housekeeping/say
> hello kind of stuff shuld be free.  Publishing also, since 1)
> there's no guarentee that the site you publish blocks to
> will keep them for any nonzero length of time and 2)
> Theoretically the people you publish to will expect to make their
> "profit" from other people requesting those blocks.  

This has been a long debate among hard-core capitalist types who want
to see everything have a price.  In a voluntary system for exchanging
and publishing information, who should pay and who should be paid?

Of course the easy answer is that the market will decide.  But when
you're trying to design the mechanisms then you have to anticipate the
market's needs.  You have to predict what the market will decide.

Unfortunately, the realistic answer seems to be that many possible
patterns of payment will be desired by the market.   In some cases
providers of data will pay others to read it: advertising, political or
persuasive arguments, reputation-building essays.  In other cases people
who want the data will pay those who provide it: music and other arts,
entertaining and informative works.

MN identifies three roles: author, consumer, and publisher (they don't
necessarily use these names).  The author creates the data (or supplies
data authored by someone else).  The publisher provides the resources to
make it available: disk space, network access.  The consumer downloads the
data and uses it.  In some cases the author and publisher may be the same.

It seems reasonable that the consumer would pay the publisher for most
data.  Presuming that the consumer is going to the trouble of downloading
the data, he must want it and so he will be willing to pay for it.  There
may be some examples as noted above where the author wants to subsidize
the consumer's access.

In the MN model, the consumer pays the publisher, and the author pays
the publisher as well.  This latter aspect is the most controversial.
Why should an author pay to get his data distributed?  Well, as noted
above there are some cases where it makes sense, but in those cases
the author also wants to encourage consumers to download his work.
Just putting it on servers is not enough.  MN does not provide for a
subsidy or payment to downloaders.

Ideally the publisher should be able to pay the author for the work.
This corresponds most closely to the traditional publishing model.
Talented authors get paid by their publishers, who then receive payment
themselves by consumers.  For this to work though the publisher must
be able to make judgements about which authors are talented.  In the
traditional publishing world this is handled by reputation and human
judgement.  It might be possible to automate this to a considerable
extent using cryptographic reputations, but it is a new area that would
need much infrastructure development.

A mailing list such as this one is a microcosm of an information
exchange, one where no payment is possible.  Each person who posts
puts some effort into creating his message (some more than others).
Some people's messages are worth reading and subscribers might even be
willing to pay to get them.  Others serve more to gratify the ego of
the writer and he might have to pay to get his contributions read.

Imagine a cash-based mailing list (perhaps using play money).  Each
contributer would either pay or get paid for his submissions, depending
on his current reputation.  Subscribers would have a quantity of cash
flow that they could funnel towards the reputation of the authors they
enjoyed the most.  Slashdot's karma system is similar to this and it
does a pretty good job of separating the quality from the crap, although
there are complaints that it promotes groupthink.  A system based more
openly on cash payments could be a model for future information markets.