Awesome free state project open to bitcoin donations

[chickenado]

After skimming over this long thread, I'd like to make one more point which I haven't seen mentioned yet:

A world without implicit contracts does not necessarily lead to chaos and endless civil war.

In his book Practical Anarchy Stefan Molyneux describes how such a hypothetical society could function and thrive.

The idea is that there are several dispute resolution organisations (DRO) competing (and cooperating) with eath other.  There are no implicit contracts. There are only explicit contracts with DROs.  In practice, almost everybody would end up being a member of some mainstream DRO.   

So let's take some examples that Onarchy has used, and see how DROs would resolve this.

1) Someone who produces kiddie porn. 

This one is easy. Since kiddie porn is almost universally condemned, this person would amass a terrible reputation, and soon he would have trouble finding a reputable DRO prepared to take him as a member.  Without a DRO to protect him, someone might just "accidentally" murder him as soon as he is forced to leave his property to find food, because he has no explicit contract with 99.99% of society protecting him against murder. 


2) Defamation  and Threats

In a world where anybody can commit the "crime" of defamation against anybody without fearing physical retaliation, baseless defamation and relaliatory defamation would soon spiral into a "flame war", and nobody would take this kind of information seriously anymore unless it's backed up by evidence.  Also, people would no longer believe information outside their web of trust.  If someone defames a person inside their web of trust, and the published information turns out to be baseless, or a cruel breach of privacy,  they would lose hard earned trust from a lot of people.  That would act as a strong deterrent.   

In short, society would acquire more healthy skepticism, and paradoxically, there would be less defamation even though it's not explicitly illegal. Implicit libel+slander laws are similar to "consumer protection" regulation leading to passive, gullible consumers, who dishonest companies find easier to rip off. 

3) Being murdered because I'm not wearing a sign "don't murder me".

Again, since murder is almost universally condemned, almost every DRO would have a clause against this, and reputable DROs would have reciprocal agreements allowing to "extradite" murderers to each other.  The putative murderer would be wise to assume that a person on the street has a 99.99% chance of being protected from murder by their DRO, who would hunt down the murderer.   Ok, this model still doesn't protect against "crime of passion" murders but neither does the statist, implicit contract model.

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[wb3]

I wonder if any of the 'experts' consulted by the Free State Initiative will be from the Social Science Research Council or Harvard Business School.

http://blogs.hbr.org/cs/2011/03/big_content_is_strangling_amer.html

One of the greatest threats to the US's ability to innovate lies within: specifically, with the music and movie business. These Big Content businesses are attempting to protect themselves from change so aggressively that they risk damaging America's position as a world leader in innovation.

At least in the Music and Movie business. To support your post; I use NetFlix, there was a Taiwanese film about an Autistic Girl that learned Karate from just watching it on TV. It was one of the best Asian films I had seen and was better than much of the stuff that comes out of Hollywood. It had Drama, Action, Romance, etc... and done very well.

I would have never seen this film if not for Content Service like NetFlix. I would rather watch NetFlix at $7 a month, than pay Hollywood $7 a movie.

The first shock that Hollywood will get, is when a famous Director markets a movie to investors for say a budget of $30 Million and releases it on Itunes for 0.99¢ a download.  Now I am willing to bet that rather than Pirate the movie more than 100 Million People will download it. Will they make Billions? No, but 200% return on a investment isn't bad, especially in this market.

I am kind of surprised that Apple doesn't finance a major movie to give it a go. It would increase their relevance and power if successful. Itunes could be the next best "Movie Theater".

[onarchy]

Anyhow, your position seems to be that if person A puts a lot of work into something and person B benefits from the fruits of that work in some way,  B has somehow become indebted to A because B has entered an implicit contract, from the mere act of benefiting.

No, benefiting is not sufficient. I benefit every single day from technology and capital I don't own and from products I have never bought. I've never used an oil tanker directly and neither have I paid for it directly. Yet, I benefit from oil tankers every single day, and it's perfectly ok. What would NOT be ok is if I benefit DIRECTLY from a product without paying for it.

The problem with this principle is that it is impossible for a central authority to objectively quantify this kind of positive externality for individuals, much less enforce compensation.  

But as you can see, I have never claimed you should be paid for positive externalities. Copying someone's unique mental work and using it to the detriment of their ability to profit from their own work is not a positive externality, it is piracy. Most people have no problem understanding the difference between externalities and piracy.

Example: Mike spends 10 years working on a brilliant poem and when it's finally finished he shows it to his best friend John. Without Mike's permission, John graffities the poem onto a bridge where Mary reads it from the train on her daily commute.  She is so inspired by the poem that she decides to give up her job and start her own business, making her, and by extension, her husband Fred a millionaire.  According to your principle, Fred is now indebted to Mike. But how much does he owe? $100 ? $100,000 $10M?.  There is simply no    
objective way of determining this, even if this whole chain of events was public, and even a Big Brother state would not be capable of illuminating all the complexities of social webs.

As I just pointed out, indirect benefits do not count. That's not what we're talking about.

Life isn't fair according to your definition of fairness. If it was, a heart surgeon who works 24 hour shifts and saves countless lives would make more money than a rich heiress who lives off rent and never lifts a finger.   That kind of "fairness" can only function in totalitarian state.  The heiress is lucky to be sitting on capital she didn't need to work for the same way the inventor of aspirin is unlucky he had to work for capital he cannot sit on.

We're not talking about mere unfairness (it's unfair that some are lucky to be born with good genes etc.), but about injustice. 

As someone else put it well, the purpose of property rights is not utilitarian, the purpose of property rights is to settle disputes over who controls a finite resource.

I agree that it's not utilitarian, and as an approximation it is an ok definition of property to say that it settles disputes over who controls a finite resource (that's a utilitarian argument), but the more fundamental argument is that YOU OWN YOUR OWN LIFE. Your life is a WORK PROCESS. Every single moment of your life you have to work (through your metabolism at the cellular level, through physical labor and through mental labor). You are a work machine, and you are defined by that work. You are YOU because you create yourself and when you structure your surroundings and reality that becomes part of you. Since we humans are a social species (i.e. peacefully coexist) then it means that living as a human means to respect each other and live peacefully together. Peace is defined as to be able to have full sovereignty over your SELF (and hence also your WORK PRODUCTS). That's the fundamentals, not some arbitrary principles about settling disputes.

[onarchy]

Please define "economic exploitation".

Direct commercial utilization of the IP. Someone who buys the book doesn't have the right to distribute and sell copies of the book. This should be fairly easy to understand since current IP law examplifies this very well.

If ideas are not property you cannot own your idea.

That's right.

Labor != property, but you can use labor to create property.

ALL property was originally created through labor. (Property can be sold or given away, but that doesn't change the fact that the origins of the property was labor)

You own your labor, you own the object you created, but you don't own the idea.

That's right. You own your own thoughts of course, but owning an idea would infringe people's right to think freely with their own minds and that would be a gross violation of the freedom of thought. In your head you can do whatever you want.

If you used 10 years of your life to figure out how to walk backwards, I won't pay you for it.

Well walking backwards is not UNIQUE is it? It's not a novelty, and hence it doesn't matter that I've spent 10 years reinventing something mundane. I cannot exploit that concept economically with IP rights because it is not novel.

If you don't sign a contract with another person explicitly stating not to, it's ok to kill him.

Why would you even suggest something like this? I know you agree that you own your own body and therefore do not need a sign.

Because the right to not be killed IS an implicit contract. You CAN agree to have someone kill you (euthanasia) so it's not completely unrealistic that someone wants to be killed. However, by DEFAULT you assume that people DON'T want to be killed, and you therefore have to make an EXPLICIT contract with someone in order for it to be legal for someone to kill you.

Why is "10 years" and "hard work" relevant? Do you believe in the labor theory of value?

I'm only using a large number to create an extreme example. Most people's moral compasses often require more than fine nuances. They need to see the most significant bit before they can sea the lesser bits. So its only purpose is to make a very clear point. No, I don't believe in the labor theory of value, but I DO believe in the labor theory of PROPERTY, which is not the same thing. That something has a MARKET VALUE is not the same as it being your PROPERTY. These are completely separate topics. Property means "that which is under your sovereignty, i.e. full control." Market value means what people are willing to pay for someone's property.

Other than that, I applaud Onarchy's initiative, although I suspect there will be a lot of debate on certain issues like IP and FRB.

I don't mind debate, that's why I am participating. I just wonder how materialism (upon which Marxism is based) could acquire such a prominent position in libertarianism. It's flabbergasting and disturbing because the position of anti-IP libertarians and Marxists on intellectual property is identical and for identical reasons.

The same goes with "FRB is fraud." I can understand that people are skeptical towards FRB (just like I understand that they think IP law is broken) but from here to conclude that FRB is fraud is a complete mystery. I have btw, written an essay on Fractional Reserve Banking for those interested:

http://onarki.no/blogg/2011/04/fractional-reserve-banking-vs-pure-gold-standard/

[wb3]

No, benefiting is not sufficient. I benefit every single day from technology and capital I don't own and from products I have never bought. I've never used an oil tanker directly and neither have I paid for it directly. Yet, I benefit from oil tankers every single day, and it's perfectly ok. What would NOT be ok is if I benefit DIRECTLY from a product without paying for it.

If you borrow a Pen or Pencil from your friend to write a note, are you are committing a crime? You are benefiting from something directly that you did not pay for. If you write a novel with the borrowed pencil, does the novel belong to you, or do you have to share the profits with the owner of the Pencil. What if he lent you the pencil conditionally? He let you use it to erase something but not write something.

What if the pencil he lent you wasn't his pencil to lend? You had no right to write with it.


You get the idea.

[onarchy]

No, benefiting is not sufficient. I benefit every single day from technology and capital I don't own and from products I have never bought. I've never used an oil tanker directly and neither have I paid for it directly. Yet, I benefit from oil tankers every single day, and it's perfectly ok. What would NOT be ok is if I benefit DIRECTLY from a product without paying for it.

If you borrow a Pen or Pencil from your friend to write a note, are you are committing a crime? You are benefiting from something directly that you did not pay for.

It depends on what kind of relationship you have with your friend. Is it very likely that your friend would say yes to lending you his pen or pencil? If so, then borrowing is not a crime. However, suppose you borrow 1 million dollars from him (his entire life saving) to go gambling in Las Vegas. Then you WOULD be a criminal, because this is something that he would very likely object to very loudly.

If you write a novel with the borrowed pencil, does the novel belong to you,

Yes. At most I have to pay a few cents for borrowing the pen.

or do you have to share the profits with the owner of the Pencil.

No sharing.

What if he lent you the pencil conditionally? He let you use it to erase something but not write something.

Still no.

What if the pencil he lent you wasn't his pencil to lend? You had no right to write with it.

Still no. He could go to a civil law suit against me and I would have to fully compensate him for using the pen, but the novel I write will in no way affect the compensation. It will ONLY be for using his pen, whether I use to write doodles or a novel.

You get the idea.

Yeah I do. All these examples has nothing do with IP.

[wb3]

Yes. At most I have to pay a few cents for borrowing the pen.

Ok, so the most any "Pirate" must pay is the cost of the item. So instead of the $150,000 dollars, he would only pay $19.99


Or as many do, they purchase the item and use Pirated copies because they are easier to deal without the DRM.

 Just ask Ubisoft, who are selling a pirate-sourced soundtrack of Assassin’s Creed: Brotherhood to their customers. Or Belarus’ National State Television, who aired a pirated copy of The Hurt Locker on Oscar night.

At first everything seems normal, but those who look closely will notice something interesting. On the film’s cover we can read the following text – “Killers 2010 BDRiP AC3 XViD-ILOVE” – which is a direct reference to a pirated copy of the film that can be found on numerous torrent sites.

It is unclear whether any of the other films on board were also being provided from pirated sources.

Although there is little doubt that we’re dealing with a pirated copy of Killers, this doesn’t mean that Saudi Airlines doesn’t have a license to show the film. Sometimes it’s just more convenient to deal with non-DRMed files than the copies that are provided through official channels.

If I buy a new release DVD, and bring 50,000 friends to the Super-dome to watch it, I have done nothing wrong. Streaming DVD's is the same principle.

If I purchased a DVD, I can download it and watch if from a pirated source because I own the DVD. It is just easier to move the file between systems because of the lack of DRM. If big companies can do it, why not me or others?

I might even want to add my own subtitles, to the film. What is wrong with that? I own the DVD. I own the content on that DVD. If they don't want me to have the content, don't sell it to me.

If I go over a friends house and he gives me a DVD, it is now mine. All right to the property have been transferred.

[onarchy]

After skimming over this long thread, I'd like to make one more point which I haven't seen mentioned yet:

A world without implicit contracts does not necessarily lead to chaos and endless civil war.

(snip)

These are certainly the best arguments presented so far, and any state has to mount very serious arguments against anarchy. I really don't want to go into that debate now, although I will sketch the argument:

Back in what I call The Original Tribe (i.e. the natural environment humans have lived in and adapted to most of their evolutionary history) there was no state. There were only a few dozen tribe members and the organization of that tribe could just as easily be called anarchism as socialism, laissez-faire, tribalism or nationalism. With such a small group all these organizational systems become virtually identical. Indeed, that is why all these are so popular. The reason you don't need a state in The Original Tribe is because you have something that completely balances power and prevents violation: love and friendship. If you KNOW someone personally it is extremely unlikely that you will enslave them. And if you are part of a family you tend to share with each other in an egalitarian socialist like manner.

The problem with love and friendship is that they don't scale up. You can love and be friends with so and so many people, but beyond that you have no relation with them. They are alien to you, strangers. Now, THIS event (which probably took place around 12,000 years ago with the advent of agriculture after the dramatic rise of CO2 after the ice age) of scaling up the tribe to such a size that the STRANGER was introduced in society was also the birth of slavery and structural violation. With a sufficiently large tribe there will always be groups who have no moral restrictions on what they could do to other groups in the tribe, and hence you get the rise of mafia and despotism. Thus, what is needed is a system that allows for the STRANGER to live safely. That's what a classically liberal society is all about: privacy, i.e. the right to be a stranger. Socialists don't want you to be a stranger. They insist on you being part of the family, treating you as part child and part brother whom they can demand egalitarian sharing from.

But in this world filled with strangers it is inescapable that there will arise mafias who will take over the whole of society and impose despotic rule -- fascism -- on everyone. This happens rarely, but when it happens the condition is extremely hard to get rid of and lasts for centuries. Therefore, what is needed is a minimal state with a single purpose: to prevent the births and takeover of mafias, which is inevitable in a world of anarchy.

However, notice that the minarchy can be very, very small, allowing for something very close to private security firms and even private courts, and if you read our section on Rule of Law, I briefly outline MY strategy for preventing a minarchy from devolving into fascism, as it has in the United States and Europe.

http://freestateinitiative.org/free-state/rule-of-law

[thisone]

I don't mind debate, that's why I am participating. I just wonder how materialism (upon which Marxism is based) could acquire such a prominent position in libertarianism. It's flabbergasting and disturbing because the position of anti-IP libertarians and Marxists on intellectual property is identical and for identical reasons.

The same goes with "FRB is fraud." I can understand that people are skeptical towards FRB (just like I understand that they think IP law is broken) but from here to conclude that FRB is fraud is a complete mystery. I have btw, written an essay on Fractional Reserve Banking for those interested:

http://onarki.no/blogg/2011/04/fractional-reserve-banking-vs-pure-gold-standard/

I know a ton of libertarians that are pro-IP and don't consider FRB to be inherently fraudulent. Most of them adhere to the Austrian school (which is the only school that seems rational to me), and most of them love the works of Ayn Rand. But they don't necessarily agree with everything that comes out of either camp.

I often quote Rand and Rothbard even though they aren't always compatible. But both of them did a great deal of good. What worries me is the rivalry that I sometimes witness between Objectivists and Austrians. I won't dismiss Rothbard because Rand "shunned him". (And I won't dismiss Mises, Reisman etc for that reason either). I don't mind that people disagree, but I think it's sad when Objectivists try to discredit Austrians, frantically avoid quoting them (even though they often have to in order to support their arguments), embrace supply siders etc, only because some of their supporters would disagree on certain issues.

I suspect that you refrain from calling yourself a libertarian in order to distance yourself from anarchists, Rothbardians, anti-IP and anti-FRB people, and maybe even Rothbard himself. I don't see it that way. I don't think you have to be anti-FRB or an anarchist to be a "libertarian". (Yes, I've read some Objectivist literature on "libertarianism", but I don't endorse their definition.) I align myself with people like you because we agree on 99% when it comes to politics (considering the socialist, welfare state, corporatist plague that is so prevalent today). I applaud every attack on the collectivist mentality, and I won't stop promoting Atlas Shrugged even though my Objectivist neighbor calls Rothbard a liar. Like Rand said: "Mises in economics". And like Mises said: "... but Atlas Shrugged is not merely a novel. It is also (or may I say: first of all) a cogent analysis of the evils that plague our society, a substantiated rejection of the ideology of our self-styled "intellectuals" and a pitiless unmasking of the insincerity of the policies adopted by governments and political parties.".

And, to quote someone else: "Baby, this shit we got together, it's so good we gotta get the government in on this shit. We can't just share this commitment between us. We need judges and lawyers involved in this shit, baby. It's hot!"

[wb3]

That is exactly how publishing startups like Spotify and even individual artists and authors are succeeding. A girl can sell copies of her self-published book on Amazon and make $180,000 in a year, without a team of lawyers to chase down people that are sharing her book, no DRM or any other deterrent, simply because it is convenient for the consumer. It would have taken her years to get her work published had she gone through a traditional publisher, that is if she could find a literary agent that would even answer her correspondence. The point being there are market based approaches to IP that are far more successful than any kind of centralized enforcement effort.

Agreed, it is the Free "Free Market".  And I like it.  She made more than she thought and is happy with what she received. She is not expecting to forever make thousands off of her work. Her work, earned what it earned. Onto the next book.

It is the way it is supposed to be. Amazon did a great service to authors. Sure they take a cut, but not excessively so. And they sure aren't suing on her behalf. It is what it is.

It is hard to move the "Artists" out of their penthouses in New York. They created something once, and expect to get paid for it forever. They are delusional. It worked for them for awhile but not anymore.  Even journalist are getting scared, crowd sourcing news is way more accurate than one journalist with "sources."

[onarchy]

Yes. At most I have to pay a few cents for borrowing the pen.

Ok, so the most any "Pirate" must pay is the cost of the item. So instead of the $150,000 dollars, he would only pay $19.99

Well, the pen is different in that it wasn't a product that your friend explicitly sold for profit. If he was a pen dealer and you used a pen that he sells at 150,000 dollars, then you may not have to pay the whole price, but at least the price of the market value reduction from becoming a used item.

Or as many do, they purchase the item and use Pirated copies because they are easier to deal without the DRM.

That's in my view perfectly ok, so long as you don't spread the copy. I do that myself. Remember IP rights do not give a blank check to limit information usage in any way the creator wants. It must serve the purpose of economic exploitation (or privacy issues when that applies.) A DRM has no function for a legitimate user who does not pirate. The creator's intention is not to hamper the user experience, but to prevent piracy.

Although there is little doubt that we’re dealing with a pirated copy of Killers, this doesn’t mean that Saudi Airlines doesn’t have a license to show the film. Sometimes it’s just more convenient to deal with non-DRMed files than the copies that are provided through official channels.[/i]

Agreed, and it's just fair use. There's something screwy about the laws of society (particularly the banking/money laws which prevents micropayment systems), and to compensate for that screwiness in the way you described is not a violation of IP rights.

If I buy a new release DVD, and bring 50,000 friends to the Super-dome to watch it, I have done nothing wrong. Streaming DVD's is the same principle.

No, here you HAVE violated the conditions of the DVD. Fair use means watching it with your family (up to 5 people). 50,000 people is obviously distribution and is a violation of IP rights.

If I purchased a DVD, I can download it and watch if from a pirated source because I own the DVD.

Agreed.

It is just easier to move the file between systems because of the lack of DRM. If big companies can do it, why not me or others?

Agreed.

I might even want to add my own subtitles, to the film. What is wrong with that?

Nothing wrong with that.

I own the DVD. I own the content on that DVD. If they don't want me to have the content, don't sell it to me.

Well, you own the instantiation of the content on the DVD, but you don't own the distribution rights.

If I go over a friends house and he gives me a DVD, it is now mine. All right to the property have been transferred.

That's true, so long as he has actually not made a copy of it and that you now are watching a duplicate.

[onarchy]

I am kind of surprised that Apple doesn't finance a major movie to give it a go. It would increase their relevance and power if successful. Itunes could be the next best "Movie Theater".

That is exactly how publishing startups like Spotify and even individual artists and authors are succeeding. A girl can sell copies of her self-published book on Amazon and make $180,000 in a year, without a team of lawyers to chase down people that are sharing her book, no DRM or any other deterrent, simply because it is convenient for the consumer. It would have taken her years to get her work published had she gone through a traditional publisher, that is if she could find a literary agent that would even answer her correspondence. The point being there are market based approaches to IP that are far more successful than any kind of centralized enforcement effort.

I applaud and welcome any such improvements as described here. As I have stated numerous times during this debate. IP is so seriously flawed today due to bad laws, mainly due to extremely cumbersome money and banking laws which makes it virtually impossible to start a bank or payment service. As a consequence of this only NOW we are starting to something like Flattr, iTunes, Spotify and other similar solutions that imitate micropayment. With free banking I am positive that we would have seen micropayment systems as soon as before 2000. It is not impossible that when the WWW was built payment systems had been built right into the protocol without the prevalent banking laws. Today micropayment would have been just as mundane and common as email, and as a consequence ALL software, music and movies would have been on a digital payment platform at super-low prices. There would have been virtually zero piracy and no DRM.

To my knowledge no libertarians have ever pointed out the relationship between the bad state of IP and the bad money laws, because most people don't understand the relationship.

I look at the attitudes of Onar Åm and wonder if such a Free State Initiative might be better served by people with a more progressive vision.

Theft is not progressive by any standard.

How would companies like Microsoft fare doing business through channels made available through such a Free State? Software piracy is an integral to Microsoft's market entry strategy for emerging markets. What would they do? Arrest Microsoft's agents, or people that Microsoft is encouraging to pirate their wares? The level of regulation and enforcement would eventually make administrative efforts very top-heavy in such an environment.

It's hard to say exactly what would happen in a Free State, but generally speaking organized piracy would be struck down.

I am wonder what the law enforcement strategy for such a Free State would look like. Would there be one system for workers and another for the operators of multinational corporations?

There would be equality before the law.

[wb3]

No, here you HAVE violated the conditions of the DVD. Fair use means watching it with your family (up to 5 people). 50,000 people is obviously distribution and is a violation of IP rights.

I am in trouble, my family has 7 in it. With extended family (sister, etc...) I have 20.  Often more than 5 watch DVD's at my house.  So IP has limited my right to how many friends that can watch a movie.

But Yet you state:

If I go over a friends house and he gives me a DVD, it is now mine. All right to the property have been transferred.


That's true, so long as he has actually not made a copy of it and that you now are watching a duplicate.

So instead of having everyone at the same time watch my DVD, I can give it to a friend, and them give it to another, and with just degrees of separation, almost everybody can watch the DVD.

So its not really that I can't have 50,000 people watch the DVD, I just can't have them watch it at the same time.

Hence, a DVD club where each buys 1 DVD then sends it on to another predetermined group member say after 2 days, would be OK.
In effect, rather than 50,000 people buying each and every DVD, they each buy 50,000 different DVD's and give it to their friends at predetermined intervals.  Apparently there is nothing wrong with that.  Why does something tell me if this occurred new laws would be written to prevent it.

Irrespective of any laws, when a "Black Market" exists, it is just the Free Market at work. Someone has overpriced or suppressed the availability of something many want. Is it wrong, who is to say.  The Kennedy's got rich by bootlegging liquor, no one complains now about it.

Others are getting rich selling cigarettes in New York City because of the Price they put on Cigarettes there. When you can buy a carton duty free for $14 and sell them in NYC for $80, there will be a market, no matter what laws are written.

It is funny watching the clowns in the circus go round and round wondering why the system isn't working. They are not seeing the forest through the trees. It is working, just not they way they want it to work.

[onarchy]

No, here you HAVE violated the conditions of the DVD. Fair use means watching it with your family (up to 5 people). 50,000 people is obviously distribution and is a violation of IP rights.

I am in trouble, my family has 7 in it.

Well, I was using a typical order of magnitude numbers. 5 is ok, 50,000 is NOT fair use. 500 is not fair use either, and neither is probably 50.

So instead of having everyone at the same time watch my DVD, I can give it to a friend, and them give it to another, and with just degrees of separation, almost everybody can watch the DVD.

So its not really that I can't have 50,000 people watch the DVD, I just can't have them watch it at the same time.

If you would like to put it like that, yes. But the point is that with transferred ownership (and hence serial viewing) it will take 11 years for 50,000 owners to watch a 2 hour movie, if they watch in a continuous marathon. If we assume that there are 4 people in the family of each owner on average and it is actually only watched during the afternoon hours (i.e. when people are home from school and work and not sleeping) Then you can if you're lucky get two ownership transfers per day and it will then take 17 years for 50,000 people to watch the movie. By that time the movie is outdated and everyone who wanted to see it has seen it anyways. I.e. this serial transfer of ownership, even when done very efficiently (i.e. twice a day), does not significantly undermine the IP (i.e. the ability of the owner to profit from his creation).

Irrespective of any laws, when a "Black Market" exists, it is just the Free Market at work.

That is true. A large black market shows that something is wrong, but not necessarily WHAT is wrong. It may be overpricing, it may be hampering of the product (DRM or annoying FBI-warnings), inavailability due to bad payment systems due to bad banking laws etc. But you cannot from a black market alone tell WHAT is wrong.

It is funny watching the clowns in the circus go round and round wondering why the system isn't working. They are not seeing the forest through the trees. It is working, just not they way they want it to work.

If there is a black market then obviously the system is not working.

[wb3]

If you would like to put it like that, yes. But the point is that with transferred ownership (and hence serial viewing) it will take 11 years for 50,000 owners to watch a 2 hour movie, if they watch in a continuous marathon. If we assume that there are 4 people in the family of each owner on average and it is actually only watched during the afternoon hours (i.e. when people are home from school and work and not sleeping) Then you can if you're lucky get two ownership transfers per day and it will then take 17 years for 50,000 people to watch the movie. By that time the movie is outdated and everyone who wanted to see it has seen it anyways. I.e. this serial transfer of ownership, even when done very efficiently (i.e. twice a day), does not significantly undermine the IP (i.e. the ability of the owner to profit from his creation).

I wonder if George Lucas would agree with you.

But we might be coming to a consensus. If instead of Mailing these movies, we have a club house, that sells say beer and pretzels, where you can come and mingle, pick a movie to take home, bring any new purchases for others to the shelves of the club house, this would be OK.

As the Club Owner, I make money off of the sales of beer and pretzels, the club members get low cost almost free movies (because they must be averaged down from each others purchases). Would this be an acceptable business in your new system? Even though it does hurt DVD sales (maybe, cause they might not buy the DVD otherwise).

[onarchy]

If you would like to put it like that, yes. But the point is that with transferred ownership (and hence serial viewing) it will take 11 years for 50,000 owners to watch a 2 hour movie, if they watch in a continuous marathon. If we assume that there are 4 people in the family of each owner on average and it is actually only watched during the afternoon hours (i.e. when people are home from school and work and not sleeping) Then you can if you're lucky get two ownership transfers per day and it will then take 17 years for 50,000 people to watch the movie. By that time the movie is outdated and everyone who wanted to see it has seen it anyways. I.e. this serial transfer of ownership, even when done very efficiently (i.e. twice a day), does not significantly undermine the IP (i.e. the ability of the owner to profit from his creation).

I wonder if George Lucas would agree with you.

But we might be coming to a consensus. If instead of Mailing these movies, we have a club house, that sells say beer and pretzels, where you can come and mingle, pick a movie to take home, bring any new purchases for others to the shelves of the club house, this would be OK.

Once it becomes organized it is no longer in line with fair use, so this would not be ok or at the very least borderline. Though, the creators factor in fair use into the price, so that the one who actually pays for the DVD ends up paying for the average number of freeloaders fair use involves. Needless to say if such a scheme cought on and become very common the publishers would simply compensate by increasing the price.

On the other hand the exact opposite would happen with pay-per-view and micropayment. If there were no freeloaders and every single one who ever saw the movie or listened to the song actually paid then the price per listen or pay per view would become VERY small. Let me give one of my favorite examples. Consider the success series Prison Break. It was cancelled after its fourth season (I think). Why when it was so popular? Piracy. Too many people just downloaded the series instead of watching the horrific ad-version on TV. How could this EASILY have been fixed with micropayment? The average number of official viewers in the LAST season was about 6 million. On average each episode in the third season cost 3 million to produce. So with micropayment installed in every TV, if every single official viewer paid 1 dollar per episode (45 minutes) then that would have given the series producers a profit margin of a stunning 50%. That's really, really good. Now, if you factor in all the millions of people who watched the series abroad and all the people who downloaded it then I'm quite certain we are talking about at the very minimum 20 million people. If we now say that a reasonable profit margin for such a series is 40% (to cover the high risk etc.) then each episode would have to bring in 5 million dollars. 5/20 = 0,25 dollars or 25 cents per episode per viewer. In other words, with proper micropayment Prison Break could be extremely profitable at 25-50 cents per episode. I would not hesitate one second to pay that amount, and neither would 99% of viewers.

Now, Prison Break was cancelled. But not only Prison Break. Remember Battlestar Galactica? This fantastic series was cancelled in after its fourth season due to too few PAYING viewers. Remember the prequel Caprica? Cancelled after its FIRST season for the same reason. Think back to all your favorite TV shows that have been cancelled way too early due to too few viewers. Every single one of them could have continued for a much longer time had it not been for piracy and the lack of proper payment systems. These are the casualties of piracy and bad banking laws. So all you anti-IP guys out there that love a series that has been cancelled: You got *exactly* what you asked for.

Think about the horrendous state of Hollywood today, how few truly good, creative and novel movies come out these days. That drought of creativity is entirely due to piracy and bad payment systems. In a sense all these movies and series that are NOT made is Atlas Shrugging, the men of the mind are on strike due to the widespread looting of the able.

[wb3]

I accept your points, as plausible and logical. I disagree with the cost of production and estimation of losses.

Remember "Clerks" by Kevin Smith. Production $28,000 dollars, and made some actors famous from being neighborhood kids on the block. It is the costs of production that many have the argument with.  What really scares the Big Guys is the indie movement. They fear it and are trying to prevent it.

The simple economic price points are not hard to define. When the price of the product is cheaper and more convenient to you acquiring it from another method, the correct price is set.

What gets people going, is not that artists make profits, but how much they want and for as long as they want it. Unfortunately for digital media, the laws of supply and demand do not disappear because you want them to. If I could mine all the gold I want, the price will fall because I can supply as much as you want. Once digitized, the supply side becomes really easy to meet the demand side for next to nothing. Sorry, it won't go away as long as what you make can be digitized. Right or Wrong doesn't matter. Supply/Demand is a natural system.

I have traveled the world. In almost any country you can buy DVD's on the corner for $5-$10 that have about 20 movies on it. It is part of local economies in some places. You can't put Schrodinger's Cat back into the Box. ( <-- Talk about paradoxes)

The FBI just arrested a guy, glass worker, in New York for uploading a Pirated Movie (Wolverine pre release) he bought from a Korean in New York for $5. They arrested the John but forgot about the Korean that sold it to him. Yea, he did a wrong. But why didn't they go after the Korean. I can surmise, this is now big business for people that can "fight" back. People you don't turn in. People lawyers won't sue. At least Lawyers that like living.

So even if you successfully turn the internet into a "clean" model. People will just buy it at its real price point from the guy on the corner. Will people stop making movies? No, of course not. They will just reduce the cost to make the movies or lower prices.

[wb3]

Pay per view, is one of my club ideas.

No one pays for Pay per View events, businesses and bars pay for them, and let their customers watch. The Bars, Casinos, etc... make money by the business it generates at the locale.

Don't tell me that is illegal. Cause every Casino and Bar does it.   Boxing, UFC, etc...

[onarchy]

I accept your points, as plausible and logical. I disagree with the cost of production and estimation of losses.

The cost of production of Prison Break is just taken from Wikipedia. It is not infallible, but that's the numbers I've seen. Prison Break was especially covered in the news for being the most popular TV Series that "no-one" saw on TV.

Remember "Clerks" by Kevin Smith. Production $28,000 dollars, and made some actors famous from being neighborhood kids on the block. It is the costs of production that many have the argument with.  What really scares the Big Guys is the indie movement. They fear it and are trying to prevent it.

I have nothing against the indie movement. I was just quoting real costs of a real production, and even with a 3 million dollar budget per episode the series could EASILY have prospered on less than 50 cents per episode with a proper payment system.

What gets people going, is not that artists make profits, but how much they want and for as long as they want it.

I don't care, so long as a) I get a good product, b) I pay what I consider a fair price for it. I have no problems paying up to 1 dollar per episode for a series I like. Hell, if it's a really good series that only a few people watch but I just happen to love, I wouldn't mind paying 10 dollars per episode. The point is that with micropayment all movies and series are going to cost typically 1 dollar per view or less.

I have traveled the world. In almost any country you can buy DVD's on the corner for $5-$10 that have about 20 movies on it. It is part of local economies in some places. You can't put Schrodinger's Cat back into the Box. ( <-- Talk about paradoxes)

With a proper payment system it would be zero problem to actually segment a market based on location. In the Philippines it makes sense that a legal copy of a series costs somewhere around 5 cents. With such prices there could easily be 15 million viewers for a series. Given that a series today makes ZERO from such a series in Philippines, 15 million * 5 cents = 750,000 dollars per episode extra is not shabby.

The FBI just arrested a guy, glass worker, in New York for uploading a Pirated Movie (Wolverine pre release) he bought from a Korean in New York for $5. They arrested the John but forgot about the Korean that sold it to him. Yea, he did a wrong. But why didn't they go after the Korean. I can surmise, this is now big business for people that can "fight" back. People you don't turn in. People lawyers won't sue. At least Lawyers that like living.

Obviously it was the seller, not the buyer that should have been targeted here.

So even if you successfully turn the internet into a "clean" model. People will just buy it at its real price point from the guy on the corner. Will people stop making movies? No, of course not. They will just reduce the cost to make the movies or lower prices.

I think you're wrong. In Norway kids buy mobile ring tones upwards of 3 dollars or more per jingle. I don't understand it but they pay it without hesitation due to convenience. The moment it is MORE convenient to pay legally than to become a criminal the piracy rate drops to pretty much zero.

[wb3]

I think you're wrong. In Norway kids buy mobile ring tones upwards of 3 dollars or more per jingle. I don't understand it but they pay it without hesitation due to convenience. The moment it is MORE convenient to pay legally than to become a criminal the piracy rate drops to pretty much zero.

I didn't know that, and I must say; It shocks me. $3 bucks for a ring tone. Why don't they just make their own from music they have? Huh? Well, if that is how they want to spend their money, its theirs to do with as they wish.


I know this is Apple and Oranges, but if two people are selling bottled water of same quality but one is authorized and approved, and the other is a bootlegger. From who do you buy?

Now, the Authorized Guy's price is $20 per liter. And the Bootlegger's is $1 per liter. From who do you buy?

You know you are committing a crime, but something just doesn't feel right about the Authorized Guy's price. Something mischievous is going on and you have no control over the price point. It is forced down your throat. But you can, protest the system by purchasing the unauthorized water.

Of course the powers that be try to put the Bootlegger out of business, but more just pop up every-time you arrest a bootlegger. Not to mention the bootleggers are good in avoiding you, so instead you go to the customer of the bootleggers. You try to scare them into compliance, but it is really hard because their is such a big difference in the price points ($20 to $1). You must cross your fingers and hope everyone gets scared. Some might, but you still can't overcome the price point problem.

All I am saying is that the industry could have put all this to bed a long time ago, if they had the right price point. But it is hard to let go of all the Greed and Money. If they don't accept less soon, they will get nothing. And others will emerge.