Capitalism and monopolism

[Adam Back]

On Sun, May 04, 2003 at 08:40:48PM -0700, Andy Lopata wrote:
> >Anyway my view is that what props up software virtual monopolies is
> >the current IP laws.  If they were revised to remove copyright, and
> >patents I think it would help level the playing field.
> 
> Removing patents would undercut your argument for the market working
> well in the processor markets.

I think if anything the processor market would be made more
competitive yet by removal of patents as competitors with the
fabrication technology could just outright copy other companies
processors, after reverse-engineering them.  (If it was cheaper to
reverse-engineer than design one).

> Removing patent and copyright protection for software would be
> great, but politically unrealistic (because of the power of the
> copyright content cartels among Congress).

But that's a symptom of a corrupt government and laws against the
public interest.  Companies in many areas have more political power
than individuals.  For example the DMCA.  This to me doesn't argue for
more government, but for less government and system reform.

> However if Freenet, or some other technology, makes untraceable
> anonymous file-sharing effective and wide-spread, it could mean the
> effective end of copyright for digital materials.

I agree: I think anonymous file sharing should be the next generation
in p2p evolution.

> On the other hand, if the anti-copy technology produced through
> agreement between MS, the processor producers and the copyright
> cartel, becomes a reality, it could severely hamper, marginalize, or
> effectively destroy any type of anonymous file-sharing technology.

I don't think Palladium and other DRM hardware such as recently
proposed by Paul Kocher et al can realistically make any difference to
file sharing.  It seems unrealistic to think that hardware in the
hands of it's attackers (p2p file rippers) can withstand long term
attack.  And anyway the content will always be amenable to re-encoding
from the analog output, or digital signal.  Kocher's scheme is
essentially hardware-tamper resistant watermarking -- it encodes the
hardware identifier in the analog output to trace who ripped content.
However it is vunlerable to collusion over some parameter of colluders
(5 with the example system parameters).  Even then it can't be too
hard to obtain hardware anonymously removing the tracing risk even if
you don't bother colluding to avoid the tracing risk; the remaining
risk is that the player may be unable to decode new content if the
player keys are revoked after it is detected as a source of ripped
content.

> I think that IP in general is a bad idea, especially when there are
> other methods of compensating creator's for their works.  

I agree.

> Those who argue that the market is the best way to produce
> innovation and a better world rely on the false gov't stamp of
> "property" on these non-rivalrous goods.

But I think IP is something created, subsidized and only made possible
by governments.  

> >As to virtual monopolies being worse than government: I disagree
> >businesses aim to maximise profit margin and this places a limit
> >[...].  They won't do it becaues it's not profitable: unhappy customers
> >are not good business.
> 
> Maximization of profits does not create moral results.  It creates the
> greatest short-term gain for the enterprise and low prices for the consumer
> at the expense of any other considerations about how the enterprise's
> operation affects other people or businesses or the environment.  

Correct.  But at least they're trying to be profitable, which most of
the time means keeping their customers happy.  Governments on the
other hand have no such objective, and most governments burn off 25%+
of GDP -- that's a lot of money to do evil with.

> Any huge organization of people is bound to be corrupt and inept.  I
> am a constant critic of the gov't, but think there is at least some
> chance of democratic control or influence which is completely
> missing in the corporate setting.

While I agree political reform is badly needed in many aspects of
government and law, it's difficult to see how one can get there from
here using only the political process.  Your only chance is individual
mobility -- individuals voting with their feet to create competition
in government.  I guess it's a similar situation in some respects --
government is a virtual monopoly, in the sense that you don't have to
accept your current government, you can move.  However people have
ties to their country, they have friends and relatives who live there;
plus the alternatives have disadvantages too.

While IP laws do vary, it's a pity there are no major governments that
compete on IP -- by providing a copyright and patent free environment.


So while governments and corporations, and corporations buying
government favor are frequently against the interests of the
individual lobbying for reform doesn't seem likely to improve things
much.

Adam