Tech Businesses Recognize the Power of a Knowledge Commons

Intellectual property rights are supposed to give people incentives to innovate. That’s the cherished grand narrative. But what’s actually happening on the ground? A dispatch by Steve Lohr in today’s NYT suggests that the edifice of IP law may be killing basic research in the cradle:

The legal wrangling over intellectual property rights in research projects involving universities and companies, specialists say, can take months, sometimes more than a year. This legal maneuvering, they say, is not only slowing the pace of innovation, but is also prompting some companies to seek universities research partners in other countries, where negotiations over intellectual property are less time-consuming.

It turns out that the legal apparatus to negotiate and enforce intellectual property rights is a fairly unwieldy and costly enterprise unto itself. Big transaction costs. Expensive lawyers. The intense legal jockeying to determine who will own new scientific knowledge, paradoxically, is preventing scientists from having the freedom to collaborate and generate that knowledge in the first place! The absence of a knowledge commons means that a commercial market can’t emerge.

The good news is that four major tech companies (IBM, H-P, Intel and Cisco) have collaborated with seven major research universities and the Kauffman Foundation to forge a new set of guidelines for making open source software research freely available. The guidelines are intended to promote “collaborative innovation” in software development by bypassing the customary constraints of patent and copyright law.

For those people who equate the commons with communism, it’s worth pondering this statement by John E. Kelly III, Senior Vice President, Technology & Intellectual Property at IBM: “Open source software and standards developed among universities, government and the IT industry form the basis for genuine collaborative innovation. This collaboration will lead to greater commercialization throughout the IT industry. Because of that, it is imperative that these principles guide our efforts to collectively improve current intellectual property practices.” (emphasis added)

The new guidelines are an implicit retreat from the ethic promoted by the Bayh-Dole Act, the 1980 law that presumes that university research will be commercialized more rapidly if universities can patent their research. Tech businesses and scientists alike are discovering that the marketization of academic research has some serious downsides, especially for basic research. IP restrictions are preventing researchers from trading information, collaborating and innovating. The lack of a knowledge commons has serious functional implications.

The new guidelines have not yet been posted on IBM’s or the Kauffman Foundation’s website, so it’s hard to tell how broad and effective a solution they are; the market ethic fostered by Bayh-Dole has penetrated deeply into academia, altering its institutional priorities and identity in many instances. Still, it’s encouraging that major tech companies are taking practical steps to reinvigorate the knowledge commons as an indispensable foundation of their commercial fortunes.

Crossposted at OntheCommons.org.

And Ed Norton Begat Yogi Bear, Who Begat Homer Simpson, Who….

I’m coming to think that the mainstream media just may be coming around. Instead of reflexively bashing any person who copies as a “pirate,” a few reporters at The New York Times are actually entertaining the idea that copying, emulation, adaptation, etc. may be essential to creativity and culture. This is progress.

Exhibit A is the Sunday New York Times piece (December 11) by Dave Itzkoff describing the open tradition in animated cartoons of copying characters and making pop-cultural references. Itzkoff writes: “If nostalgic cartoonists had never borrowed from ‘Fritz the Cat,’ there would be no ‘Ren & Stimpy Show’; without the Rankin-Bass and Charlie Brown Christmas specials, there would be no ‘South Park’; and with ‘The Flintstones,’ ‘The Jetsons’ and the countless other cartoons that it unapologetically cribs from, ‘The Simpsons’ would cease to exist.”

While some might protest that the idea/expression dichotomy protected these things all along (and therefore nothing has changed), I think it’s a big deal that The Times is so openly, undefensively celebrating the inherently derivative nature of creativity. Again, Itzkoff: “In an uncharitable worldview, it’s possible to see Hanna-Barbera as black marketers of animation, repacking properties they didn’t create for views who wouldn’t recognize knockoffs when they saw them. But it’s far more reasonable to think of them as innovators, who…were just discovering the power of the pop-cultural reference.”

Incidentally, the ultimate pop-culture treatment of cartoon knockoffs and copyright law has to be The Simpsons’ episode, “The Day the Violence Died.” A transcript of the episode can be found here. It’s hilarious, even as a transcript. Highly recommended. (If you can find an online version of the actual episode, please post a comment below.)

Exhibit B is the recent assessment by Jon Pareles of the Grateful Dead’s crackdown on music downloading of its songs. Pareles wrote on December 3: “The Dead had created an anarchy of trust, going not by statute but by instinct and turning fans into co-conspirators, spreading their music and buying tickets, T-shirts and official CD’s to show their loyalty….The change [prohibiting free downloads of Dead music] downgrades fans into the customers they were all along. It removes what could crassly be called brand value from the Dead’s legacy by reducing them to one more band with products to sell.

“Will the logic of copying law be more profitable, in the end, than the logic of sharing? That’s the Dead’s latest improvisational experiment.”

Whew! And I thought that Ed Rothstein at the NYT was going to have the field to himself, scolding creative innovators who dare to push the envelope of our shamefully shrunken fair use doctrine.

Socially Created Value

Everyone is utterly familiar with the market narrative for how “value” is created through property rights, contracts and money. But we have far fewer stories, let alone rigorous analyses, about how social communities create value – and how that value can be retained by those communities (GPL and CC licenses are two key tools, but what else can work?) My pet theory is that socially created wealth tends to “disappear” from view because market players are so adept at appropriating and monetizing it, and then pretending that they created it in the first place. The standard IP narrative kicks in, and voila! – the role of the value-creating community is obliterated.

I think about this dynamic a lot these days as I contemplate how online communities are becoming the real engines of value-creation on the Net (think blogging, wikis, P2P, public domain archives, social networking websites, massively multiplayer online games, open source software, etc.). It’s a real mind-bender for traditional content vendors to understand that piracy is not their fiercest long-term competitor; it’s user-created content and online community. Only a relatively few savvy businesses understand that there’s a business bonanza to be made by providing open platforms that leverage people’s social impulses (to share pictures, trade web bookmarks, gossip, make professional connections, rate books, meet like-minded hobbyists, and so on). The troglodytes continue to pursue the pay-per-view, lock-it-all-up model of online information and creativity — but the real money gusher will come from those who convene social communities and unleash their social energies.

Which leads me to a question that I’m grappling with – for which I don’t have the answer. When will a major player in journalism recognize these facts and invent an online business model for reputable journalism that leverages social community and rivals the profits and influence of a CBS News, USA Today or the WSJ?

In some ways, this is already happening with major blogs and alternative news sites; it just hasn’t been publicly recognized.
Jay Rosen’s essay
for a “Journalism, Blogging and Credibility” conference in January 2005 is germane here: social trust is migrating to online venues, but mainstream media haven’t learned how to follow. Why not? I think it’s because the business of journalism, a captive of its mass-media paradigm, can’t recognize the value-creating capacities of readers in the networked environment, and change itself accordingly. Its failure to innovate could be fatal. As social credibility and trust migrate online, the agenda-setting power and influence of mainstream mass media will decline. It already has; think of the betrayals of trust committed by Judith Miller, Bob Woodward, Dan Rather, Jayson Blair and more generally, the Washington press corps – many of which were exposed by bloggers. As Craigslist, Huffington Post, Raw Story and other online venues become more efficient, trusted, versatile and speedy in providing everything from classified ads, news-gathering, punditry and even celebrity gossip, traditional mass media will lose their economic base. Their “voice of God” objectivity and brand franchises are already taking a drubbing.

I’m convinced that distributed user communities will be the foundation of a new genre and generation of journalism. That’s where the real value-creation is occurring. But how will the MSM adapt? Can it adapt without a wholesale change of identity? These are questions I keep returning to.