Congress has passed the Higher Education Act with special provisions requiring universities to push the content industry’s agenda on its students.  In order to get funding for students, universities will have to advertise commercial downloading services to students and educate them on a one-sided view of file-sharing and piracy.

The controversial provisions were added partly on the basis of the MPAA’s admittedly flawed research that claimed 44 percent of piracy occurred on college campuses - the number the MPAA later admitted was 15 percent.

So why are universities suddenly mouthpieces for a specific industry?  Even with flawed research, what makes universities responsible for the content industry’s obsolete business models.  The fact that these companies can’t track all the file-sharing makes me wonder how universities are expected to do better? Some artists want their content shared, others don’t, so leaving filtering up to a third parties will lead to overzealous blocking and can also affect educational uses for file-sharing tools.

Universities and consumer groups were able to block this bill last year when the MPAA included requiring filtering technology in its wishlist. William Patry points out that the content industry likely postponed filtering technology - doing it all at once caused too much backlash.

What concerns me is the silence among academic, from administrations and students.  College campus are the front line in the content industry’s Save Our Obsolete Business Model campaign simply because it’s easy to pick on students. There’s a reason the RIAA avoids suing students at Harvard.  Unfortunately, most universities are letting a lone industry and the government turn places of education into propaganda mouthpieces with a rare few standing up for their student’s rights.  Regardless of your position on file-sharing, universities should not be responsible for doing what the content industry already can’t do itself.

And universities need to stand up for themselves and student’s rights. What better way to educate than to lead by example.

The upcoming G8 summit has many important issues to discuss - climate change, world poverty, and file-sharing. That’s about it. Everything else is fixed.

On topic for the G8 is the secret (yes, secret) Anti-Counterfeiting Trade Agreement (ACTA) that only became public knowledge after details were posted on WikiLeaks.  The ACTA is a new treaty being written completely in secret for the purpose of restricting international piracy, allegedly allowing border security to check your iPod for illegal downloads, bring criminal charges against file-sharers, and require ISPs to police their networks.  While the public and consumer groups have not been privy to the treaty negotiations, a RIAA got a chance to submit its wishlist.

Aside from the improprieties of privately writing legislation, why is the G8 taking the time to prop up one industry’s unwillingness to adapt to the internet.  As I’ve written before, the entertainment industry does not have a right to revenue.  It’s their job to find business models that work, not the government’s.

The entertainment industry has pushed many copyright requirements into trade agreements with other countries (often falsely referred to as free trade).  The argument is these laws are needed to encourage innovation and content creation when in reality, these laws only help current copyright holders, hampering development in other countries who now have to spend money policing their citizens.

While several countries around the world waste time spoon feeding copyright holders, I’d have hoped the G8 wanted to at least pretend it cared about helping solve the world’s important crisis, of which their are many. It’s even listed first on the official website, “protection of intellectual property rights.” Piracy is not a world issue, even if the revenue losses the entertainment industry makes up were true.  That’s because it’s not the government’s job make you money - that’s your job through innovation and competition.  The G8 should try dealing with the food crisis, climate control, oil prices, genocide, poverty, human rights, and terrorism to name a few.  Of course, the U.S. attorney general says piracy funds terrorism.  Yeah, that’s convincing.

[Via CustomPC]

For the doomsaying that PC gaming is in it last throes, game publishers keep releasing games. Several publishers including Infinity Ward and Crytek blame piracy for low sales of their PC games, Call of Duty 4 and Crysis respectively. Thus publishers are packing their games with more and more restrictive and complex DRM, a surefire sales pitch to increase sales.

Electronic Arts released a PC-port of Mass Effect last month and users are already complaining they are being locked out of the game. The company restricts the game to only be installed three times and uninstalling it doesn’t reinstate an install. This is a step up from the proposed DRM which would have rechecked the game’s serial number every 10 days, requiring an internet connection to play a game that doesn’t require an internet connection. After the internet backlash, EA dropped the 10-day check, but made sure Mass Effect was still to difficult to be worth purchasing.

The upcoming game Spore is likely to have similar DRM.

The challenge for PC game publishers is not piracy, because pirates will pirate games. Fighting these pirates becomes an arms war of technology that the pirates constantly win. Publishers waste their time and money fighting them, and alienating paying customers at the same time.

Stardock takes a different approach. Their games contain no DRM and don’t require keeping the CD in the drive to play. Users with valid serial numbers get regular updates with rich lists of new features. Obviously pirates get their hands on Stardock’s games, but the publisher makes a significant profit with a loyal fan base and, shockingly, not spending so much money.

Brad Wardell, founder of Stardock writes:

Anyone who keeps track of how many PCs the “Gamer PC” vendors sell each year could tell you that it’s insane to develop a game explicitly for hard core gamers. Insane. I think people would be shocked to find out how few hard core gamers there really are out there. This data is available. So why are companies making games that require them to sell to 15% of a given market to be profitable? If you need to sell 500,000 of your game to break even and your game requires Pixel Shader 3 to not look like crap or play like crap, do you you really think that there are 50 MILLION PC users with Pixel Shader 3 capable machines who a) play games and b) will actually buy your game if a pirated version is available?

He goes on to explain why Stardock is successful without copy-protection.

When you develop for a market, you don’t go by the user base. You go by the potential customer base. That’s what most software companies do. They base what they want to create on the size of the market they’re developing for. But not PC game developers.

PC game developers seem to focus more on the “cool” factor. What game can they make that will get them glory with the game magazines and gaming websites and hard core gamers? These days, it seems like game developers want to be like rock stars more than businessmen. I’ve never considered myself a real game developer. I’m a gamer who happens to know how to code and also happens to be reasonably good at business.

Stardock games, like “Galactic Civilizations II sold 300,000 copies making 8 digits in revenue on a budget of less than $1 million” according to Wardell. Sins of a Solar Empire was the best-selling PC game of February, ahead of Call of Duty 4 and a World of Warcraft expansion.

Stardock is not praying for people to actually buy their games. They cater to a large enough market, spend an appropriate amount to make the game, and provide an on-going service to encourage people to pay for the game rather than pirate it. People pirate Stardock games, just like they’re pirating EA’s DRM-filled Mass Effect. But Stardock is making huge profits and not pissing off its paying customers. Revolutionary.

Matt Mason’s book, The Pirate’s Dilemma, goes into book-length detail about many of the copyright and file-sharing issues I so cavalierly lambaste. Mason is leading by example by releasing digital versions of his book online for a set-your-own price model.

Why would an author give away a book for free? Obviously it makes a lot of sense given the arguments in this particular book, but it’s true for all authors that piracy isn’t a threat, it’s an opportunity.

There are millions of books on amazon.com, and on average each will sell around 500 copies a year. The average American is reading just one book a year, and that number is falling. The problem (to quote Tim O’Reilly) isn’t piracy, it’s obscurity. Authors are lucky to be in a business where electronic copies aren’t considered substitutes for physical copies by most people who like reading books (for now at least).

By treating the electronic version of a book as information rather than property, and circulating it as widely as possible, many authors such as Paulo Coelho and Cory Doctorow actually end up selling more copies of the physical version. Pirate copies of The Pirate’s Dilemma are out there online anyway, and they don’t seem to have harmed sales. My guess is they are helping. To be honest, I was flattered that the book got pirated in the first place.

Media and software companies release reports that piracy costs them billions of dollars, destroying their business, funding terrorism, or hurting poor farmers. These companies lobby governments to pass laws, sue fans in court, or ask people to spy on others in order to prop up business models that are becoming obsolete. Companies should stop fighting piracy and treat it like any competitor - by competing and out innovating file-sharing services to provide a better value allowing everyone to make more money.

Matt Mason promotes this in his book, The Pirate’s Dilemma, calling piracy a sign of innovation as pirates experiment to make processes more efficient.

Some of America’s greatest innovators were thought of as pirates. When Thomas Edison invented the phonographic record player, musicians branded him a pirate out to steal their work and destroy the live music business, until a system was established so everyone could be paid royalties. Edison, in turn, went on to invent filmmaking, and demanded a licensing fee from those making movies with his technology. This caused a band of filmmaking pirates, including a man named William, to flee New York for the then still wild West, where they thrived, unlicensed, until Edison’s patents expired. These pirates continue to operate there, albeit legally now, in the town they founded: Hollywood. William’s last name? Fox.

New technology has repeatedly challenged media companies, from Edison’s phonograph to television to cassette tapes. After lawsuits attempted to quash the innovation, media companies embraced the new technology and found new revenue streams, making more money as a result. The home video market Hollywood so desperately defends now would never have existed had Universal and Disney’s lawsuit against Betamax succeeded. Instead of suing file-sharing networks, media companies need to embrace the new technology as a new way to make money.

The current state of media and software is quite good. Media companies are making more money every year. Even the music industry is making more music while more people are listening to music. The recording industry is plummeting at a rate so fast piracy cannot be the sole factor, as studies have shown.

But piracy has become an obsession for media and software companies, hurting themselves and their paying customers with DRM and restrictive policies that limit the value of their products. Microsoft, Google, and Major League Baseball have all discontinued DRM serviced, meaning people who legally paid for goods no longer get to use them while pirates continue to download DRM-free goods for nothing.

Piracy offers a compelling alternative. Piracy offers unlimited free downloads of an almost complete collection of every movie, song, TV show, book, or game ever made using a variety of easy to use programs. Pirated content has no DRM, meaning you can put your music and movies on every computer and portable device you own. On the down side, pirated content is has unreliable quality and inconsistent download speeds, but since its free, these are minor negatives.

Why should someone pay for a service with less services?

Media and software companies need to recognize piracy is not going away - it’s a competitor. No matter how many lawsuits the RIAA, MPAA, and BSA file, piracy grows. These lawsuits increase publicity for many sites and services, working against the lawsuit’s purpose - Pirate Bay, the leading BitTorrent tracker, is now one of the 100 most trafficked websites thanks to publicity from these lawsuits. And for every file-sharing service closed down, dozens more pop up. File-sharing is too useful and thus valuable.

To compete, media and software companies will need radical changes to their business models. Techdirt’s Mike Masnick constantly refers to leveraging infinite goods to sell scarce goods.

In a competitive market, the price of a good is always going to get pushed towards its marginal cost. That actually makes a lot of sense. As competition continues, it puts pressure on profits, but producers aren’t willing (or can’t for very long) keep selling goods at a direct loss. Sunk (or fixed) costs don’t matter, because they’ve already been paid — so everything gets pushed to marginal cost.

Movies, music, and software have high upfront costs but negligible reproduction costs - it’s as simple as copy and pasting a file.

This means leveraging infinite goods to sell scarce goods, like concert tickets, collectable merchandise, or advertising (people’s time and attention is very limited). $20 for DVDs and CDs worked under the old, obsolete business model. The new media economy requires new business models that offer more value to consumers. Plastic discs don’t offer $20 of value anymore, meaning new price models and revenue expectations need to be developed. Just because the recording industry used to be making $10 billion a year doesn’t mean is deserves to always $10 billion. As Masnick points out, should the automobile industry be blamed for putting horse-drawn carriages out of business? The industry has to innovate and adapt to market forces to continue making that money. That’s how capitalism works.

Several progressive artists and developers are experimenting with new business models. Radiohead’s pay-your-own price for their new album was a good start. Trent Reznor of Nine Inch Nails earned $1.6 million in one week selling special editions of his new CD, a CD that you could also download for free. Indie record label Fueled by Ramen used viral marketing to build valuable brands around its bands rather than relying on disc sales. The potential for rewarding business models exists, but will require risk and experimentation and an understanding of the evolving marketplace. Media and software companies need to recognize what their customers want and give it to them. Suing isn’t the answer. Embracing is. And that’s how both piracy and business can win.

LITG pointed me to a program that allows you to download comic books from Marvel’s digital comic service.  Almost every streaming service on the web from YouTube to Last.Fm have been hacked to allow users to easily download media in convenient and portable formats.  LITG says after they contacted Marvel about the software, Marvel DCU was changed to render the software useless.  The downloader was quickly updated and works again.

Marvel’s digital comics, as I wrote about last year, are a good start providing a small but unlimited amount of comics for a monthly fee.  Aside from the sparse selection, Marvel failed to include a download option to let users put comics on their hard drives or portable devices, which is one of the major attractions of pirated comics.

Marvel continues to learn hard lessons about file-sharing, from suing torrent websites to now fighting a ripping tool.  Just as fast as Marvel updates their website, the developer updates his software.  If Marvel updates its site again, it’ll start am arms race that costs them time and resources, but just gives this developer more publicity.  The developer is giving out his software for free; he can stop anytime. 

As Sony, Apple, and every software company can attest, fighting pirates is a full-time job.  For some bizarre reason, these companies are willing to waste resources just to fight these developers rather than embrace them.  Marvel could license this downloader for a fraction of the cost is would have taken to develop themselves, maybe throw an ad on it, and give it out so people can get more value for Marvel’s digital service.  It would inspire more people to join.  As long as Marvel regularly updates the digital collection, subscribers will have a reason to keep paying the fees. 

Marvel shouldn’t worry about downloaders sharing comics they download: people already scan every new comic on the day of release in higher quality than Marvel provides.  So Marvel already has competition that still wins with every feature: greater selection, better quality, and free.  Making an unstable service with small selection and DRM isn’t going to convert anyone.

Sony is polling PSP users why they hack their powerful handheld opening the system to a variety of homebrew software.  Sony is likely concerned about widespread homebrew which enables piracy of games.  Sales of PSP software has been disappointing, with no PSP game selling in the top 100 of games from 2007.

Disappointing software sales likely has Sony worried.  Piracy is the common scapegoat, but that line is getting old.  NeoGAF posted the number of downloads of PSP torrent files in a flawed attempt to show widespread piracy.  There are over 30 million PSPs, but Sony is scared of 100,000 downloads of God of War. 

Paranoia over piracy only hampers the PSP, hurting Sony and users.  Sony expends so much time and money to fight homebrew when homebrew only helps increase the value of the system at no cost to Sony.  No matter what Sony other tech companies do, some geeks will pry the secrets from the system.  The iPhone, MP3 players, and every video game system ever (with one exception) have been hacked.

The reasons aren’t because people want to stick it to Sony, but because hacking these systems often makes them better.  iPhone users love adding function expanding software for free while Apple stumbles to release a helpful developer kit (still waiting) to even offer a paid option.

Sony isn’t offering any option.  Sony’s PS3 has managed to rein in hackers by building in an easy Linux install, the staple of homebrew achievements (they’ve even got it running on the Wii).  So why not build in some option on the PSP.  Don’t build in piracy obviously, make the hackers work for it.  But by embracing homebrew, Sony increases the value of the PSP with no effort and lessens the incentive to hack the system for bonus software. 

There nothing to study, Sony.  People love to make stuff better.  We want our purchases to be valuable, expansive, and customizable.  Don’t fight it. Embrace it.

It’s like LimeWire for the world.  Blogger and author Cory Doctorow’s new novella, "After the Siege" (it’s free), explored an impoverished country transformed by the ability to copy everything.  Not just movies and music, but buildings, medicine, and technology.  This leads to a huge war where the rich countries demand royalties; royalties most of the poor countries can’t afford to pay.

Clive Thompson writes in praise of After the Siege recognizing not only the novella’s present day relevance, but highlighting the sci-fi genre as the last bastion of philisophical ideas.

If you want to read books that tackle profound philosophical questions, then the best — and perhaps only — place to turn these days is sci-fi. Science fiction is the last great literature of ideas.  From where I sit, traditional "literary fiction" has dropped the ball. I studied literature in college, and throughout my twenties I voraciously read contemporary fiction. Then, eight or nine years ago, I found myself getting — well — bored.

Thompson’s speaks to the strength of science-fiction, a genre while uncredited for its thought or artistic merit is often the most revealing genre of human nature and potential.  Thompson continues:

Here’s my overly reductive, incredibly nerdy way of thinking about the novel: Consider it a simulation, kind of like The Sims. If you run a realistic simulation enough times — writing tens of thousands of novels about contemporary life — eventually you’re going to explore almost every outcome. So what do you do then?

You change the physics in the sim. Alter reality — and see what new results you get. Which is precisely what sci-fi does. Its authors rewrite one or two basic rules about society and then examine how humanity responds — so we can learn more about ourselves. How would love change if we lived to be 500? If you could travel back in time and revise decisions, would you? What if you could confront, talk to, or kill God?

Doctorow’s novella presents the complex intellectual property quagmire in the simplest fashion - from a child’s perspective.  The allusions aren’t hidden.  An epidemic of zombiism has spread around the country with governments trying and failing to negotiated lower priced cures.  It was only when the government pirated (or file-shared) the drugs that they could afford to cure all those sick, dying people.  That really is a work of fiction.

Geeks aren’t the most important political voting bloc, but we have several important issues few candidates care to address.  These technology issues have major implications on technological development, the economy, and individual rights.  These are the issues most concerning to the under-appreciated geek bloc.

7. Expanding broadband

The fact that companies still advertise dial-up should concern everyone.  Europe and Asian countries have extensive broadband connectivity, even wireless technology which the United States has been unable to deploy in cities only.  The United States ranks 13th in broadband subscribers after Korea, Japan, and several Scandinavian countries with little strategy in how to expand access.  In fact, our government continues to fudge our own broadband numbers, even after other agencies have shown these numbers to be false.

6. Spyware, malware, and virus. Oh my.

All the spam, phishing scams, and crap software make the internet a scary and dangerous place.  All the information and technology available to the common person is locked behind firewalls, security warnings, and the fear of very website you visit and file you download.  While cautious is healthy in any scenario, the amount of people using the internet for evil makes for an unpleasant place to surf and enjoy.  And as the internet and computers consume more and more of our lives, these problems will only get bigger.  Both technology and the government have a vicious war ahead, which if the present is any sign, is destined to be as successful as the War on Drugs.

Continue reading…

The crawl is turning into a steamroll as Marvel Comics has targeted another comic book torrent tracker, Komics-Live.  According to Lying in the Gutters, Marvel threatened legal action against the web site.  The site was down for several days and recently returned with no Marvel files.

Marvel send legal notices to torrent trackers Z-Cult and ComicSearch a few months ago and it seems the comic publisher is looking to follow in RIAA and MPAA’s foot steps.  No lawsuits yet.

The interesting part of the Lying in the Gutters post is the affect of Marvel’s legal notices has increased comic book traffic on the leading torrent site, Pirate Bay.  Users of these niche torrent sites are just switching to different providers meaning Marvel’s takedown strategy is not having a noticeable effect on stopping comic book downloads.  As I have written before, there are so many sources for pirated content, trying to take each down one by one is impossible. 

Marvel further has a large force in Pirate Bay.  The Sweden based website has been vocal in its opposition to all copyrights and has survived years of legal threats from the RIAA and MPAA.  The Swedish government even raided Pirate Bay’s servers and found nothing illegal since Pirate Bay doesn’t host any of the infringing content itself.

It’s worrisome to see Marvel continuing this strategy and questionable what they hope to gain.  Because Marvel’s own download service does not offer the same experience - small selection, lower quality, and no download option.  Very compelling.