roundtable: Re: Is the problem content production or access to carriage?

roundtable: Re: Is the problem content production or access to carriage?

Re: Is the problem content production or access to carriage?

Brad Cox @ GMU/PSOL (bcox@gmu.edu)
Wed, 30 Mar 1994 00:20:22 -0500 

Date: Wed, 30 Mar 1994 00:20:22 -0500
Message-Id: <199403300520.AA08195@access1.digex.net>
To: roundtable@cni.org
From: bcox@gmu.edu (Brad Cox @ GMU/PSOL)
Subject: Re: Is the problem content production or access to carriage?

Michael Chui <mchui@cs.indiana.edu> wrote:
>> >could you say more about why you believe the production
>> >of high-quality content is likely to be a greater problem than obtaining
>> >access to carriage?

I responded:
>> Because means of production is such a small part of the problem. The big
>> problem is *incentive* for production.

Rob Kling <kling@ics.uci.edu then responded:
>Thanks for bringing up the issue of incentives for producing X.  The
>'socio-economics" of production are not simple.

Your're right, they certainly are not simple today. That involves a
paradigm shift towards a true information capitalism (your term, 
different meaning) in which individuals are enabled as capitalists in 
the traditional positive sense of this term (repackagers and sellers 
of their distributed tacit knowledge for a content-based fee), as 
distinct from today's negative sense of huge centrally planned 
bureaucracies broadcasting lowest common denominator spew.

I've enclosed a paper that outlines how the socioeconomics of 
information production could be made extremely simple. At the moment 
I'm encouraged that an individual-enabling approach could be feasible 
relatively soon. I happen to be at a Dept of Commerce workshop in Ann 
Arbor on exactly this topic as I write this. There's a major funding 
announcement due on such an initiative on April 11.

        Brad Cox
        Coalition for Electronic Markets
        <bcox@gmu.edu>

      Copyright 1992 by Brad Cox; All Rights Reserved

             What if there is a silver bullet
            and the competition gets it first?

                   Brad J. Cox, Ph.D.
     Journal of Object-oriented Programming; June 1992
              Dr. Dobb's Journal; Oct 1992

Few programmers could develop a compiler, word processor or
spreadsheet to compete in today's crowded software market.
The cost and complexity of modern-day applications exceed
the financial and intellectual capacity of even the rarest
of individuals. Even large-granularity sub-components like
window systems, persistent object databases and
communication facilities are more than most individuals could
handle. But individuals can build smaller (so-called 'reusable')
software components that others could assemble into larger objects;
even components as small as Stacks and Queues.

So why don't we? Why do we drudge away our lives in
companies with the financial, technical, and marketing
muscle to build the huge objects we call applications? Why
don't we start software companies, like Intel, to invent,
build, test, document, and market small-granularity objects
for other companies to buy? Think of the reduction in auto
emission pollution if more of us stayed home to build small-
granularity components for sale! Think of not having to get
along with the boss!

Object-oriented programming technologies have brought us
tantalizingly close to making this dream technically, if not
economically, feasible. Subroutines have long been able to
encapsulate functionality into modules that others can use
without needing to look inside, just as with Intel's silicon
components. Object-oriented programming languages have
extended our ability to encapsulate functionality within
Software-ICs[TM] that can support higher-level objects than
subroutines ever could[COX1]. Such languages have already
made the use of pre-fabricated data structure and graphical
user interface classes a viable alternative to fabricating
cut-to-fit components for each application. All this is
technically feasible already, even though the software
industrial revolution[COX2] has hardly begun.

Yet these technical advances have not really changed the way
we organize to build software. They've just provided better
tools for building software just as before. The pre-
fabricated small components of today are not bought and sold
as assets in their own right. They are bundled (given away)
inside something larger. Sometimes they are bundled to
inflate the value (and price!) of some inexpensive commodity
item, as in Apple's ROM software that turns a $50 CPU chip
into a $5000 Macintosh computer. Sometimes they play the
same role with respect to software objects, as in the
libraries that come with object-oriented compilers.

There is no robust way to market the small active objects
that we call reusable software components, at least not
today. The same is true of the passive objects we call data.
For example, nearly half of our landfill bulk is newspapers
and magazines. This could be eliminated if we could only
break the habit of fondling the macerated remains of some
forest critter's home as we drink our morning coffee. But
this is hardly a bad habit from the viewpoint of newspaper
publishers. If they distributed news electronically, how
would they charge for their labor?

Paper-based information distribution makes certain kinds of
information unavailable even when the information is easily
obtainable. For example, I hate price-comparison shopping
and would gladly pay for high-quality information as to
where to buy groceries and gasoline inexpensively. This
information is avidly collected by various silver-haired
ladies in my community. But they collect it solely for their
own use. The lack of robust marketing mechanisms for such
objects removes any incentive for them to distribute their
expertise to potential customers such as myself.

What if entrepreneurs could market electronic information
objects for other people to buy? Couldn't geographically
specialized but broadly relevant objects like my gasoline
price example be the killer apps that the hardware vendors
are so desperately seeking? Think of what it could it mean
to today's saturated hardware market if everyone who buys
gasoline and groceries started buying computers to access
Aunt Nellie's coupon-clipping acumen!

Information Age Economics

These questions outline the fundamental obstacle of the
manufacturing age to information age transition. The human
race is adept at selling tangible goods such as Twinkies,
automobiles, and newspapers. But we've never developed a
commercially robust way of buying and selling easily copied
intangible goods like electronic data and software.

Of course, there are more obstacles to a robust market in
electronic objects than I could ever mention here. Many of
them are technological deficiencies that could easily be
corrected, such as the lack of suitably diverse
encapsulation and binding mechanisms in today's object-
oriented programming languages, insufficient
telecommunications bandwidth and reliability, and the dearth
of capable browsers, repositories and software
classification schemes. My second book, What, if anything,
is an Object? considers these obstacles in detail to show
that each one could in principle be overcome once suitable
incentives were in place.

The biggest obstacle of all is that electronic objects can
be copied so easily that there is no way to collect revenue
the way Intel does, by collecting a fee each time another
copy of a silicon object is needed. More than any other
reason, this is why nobody would ever quit their day job to
build small-granularity software components for a living.

A striking vestige of manufacturing age thinking is the
still-dominant practice of charging for information age
goods like software by the copy. Since electronic goods can
be copied easily by every consumer, the producers must
inhibit copying with such abominations as shrinkwrap license
agreements and copy protection dongles. But since these are
being vehemently rejected by software consumers, SPA
(Software Publishers Association) and BSA (Business Software
Alliance) are using handcuffs and jail sentences as copy
protection technologies that actually do work even for
information age products like software.

The lack of robust information age incentives explains why
so many corporate reuse library initiatives have collapsed
under a hail of user complaints. "Poorly documented. Poorly
tested. Too hard to find what I need. Does not address my
specific requirements." Except for the often rumored "Not
invented here" syndrome, the problem is only occasionally a
demand side problem. The big problem is on the supply side.
There are no robust incentives to encourage producers to
provide minutely specialized, tested, documented and (dare I
hope?) guaranteed components that quality-conscious
engineers might pay good money to buy. As long as reuse
repositories are waste disposal dumps where we throw poorly
tested and undocumented trash for garbage pickers to
"reuse", quality-conscious engineers will rightly insist,
"Not in my backyard!"

Paying for software by the copy (or reusing it for free) is
so widespread today that it may seem like the only option.
But think of it in object-oriented terms. Where is it
written that we should pay for an object's instance
variables (data) according to usage (as network
access charges) yet pay for methods (software) by the copy?
Shouldn't we also consider incentive structures that could
motivate people to buy and sell electronic objects in which
the historical distinction between program and data are
altogether hidden from view?

Superdistribution

Lets consider a different approach that might work for any
form of computer-based information. It is based on the
following observation. Software objects differ from tangible
objects in being fundamentally unable to monitor their
copying but trivially able to monitor their use. For
example, it is easy to make software count how many times it
has been invoked, but hard to make it count how many times
it has been copied. So why not build an information age
market economy around this difference between manufacturing
age and information age goods?

If revenue collection were based on monitoring the use of
software inside a computer, vendors could dispense with copy
protection altogether. They could distribute electronic
objects for free in expectation of a usage-based revenue
stream.

Legal precedents for this approach already exist. The
distinction between copyright (the right to copy or
distribute) and useright (the right to 'perform', or to use
a copy once obtained) is long-established in copyright law.
These laws were stringently tested in court a century ago as
the music publishers came to terms with broadcast
technologies such as radio and TV.

When we buy a record, we acquire ownership of a physical
copy. We also acquire a severely limited useright that only
allows us to use the music for personal enjoyment.
Conversely, large television and radio companies often have
the very same records thrust upon them by the publishers for
free. But they pay substantial fees for the useright to play
the music on the air. The fees are administered by ASCAP
(American Society of Composers, Authors and Publishers) and
BMI (Broadcast Music Incorporated) by monitoring how often
each record is broadcast to how large a listening audience.

Dr. Ryoichi Mori, the head of the Japanese industry-wide
consortium, JEIDA (Japanese Electronics Industrial
Development Association) is developing an analogous approach
for software. Each computer is thought of as a station that
broadcasts, not the software itself, but the use of the
software, to an audience of a single 'listener'[MORI]. The
approach is called superdistribution because, like
superconductivity, it lets information flow freely, without
resistance from copy protection or piracy.

Its premise is that copy protection is exactly the wrong
idea for intangible, easily copied goods such as software.
Instead, superdistribution turns ease of copying into an
asset. It actively encourages the free distribution of
information age goods via whatever distribution mechanism
you please. You are positively encouraged to acquire
superdistribution software from networks, to give it away to
your friends, or even send it as junk mail to people you've
never met. Broadcast my software from satellites if you
want. Please!

This generosity is possible because the software is actually
'meterware'. It has strings attached that make revenue
collection independent of how the software was distributed.
The software contains embedded instructions that make it
useless except on machines that are equipped for this new
kind of revenue collection. The computers that can run
superdistribution software are otherwise quite ordinary. In
particular, they run ordinary pay-by-copy software just
fine. They just have additional capabilities that only
superdistribution software uses.

In JEIDA's current prototype, these services are provided by
a silicon chip that plugs into a Macintosh coprocessor slot.
Electronic objects (not just applications, but active and/or
passive objects of every granularity) that are intended for
superdistribution invoke this hardware to ensure that the
revenue collection hardware is present, that prior usage
reports have been uploaded, and that prior usage fees have
been paid.

The hardware is not complicated (the main complexities are
tamper-proofing, not base functionality). It merely provides
several instructions that must be present before
superdistribution software can run. The instructions count
how many times they have been invoked by the software,
storing these usage counts temporarily in a tamper-proof
persistent RAM. Periodically (say monthly) this usage
information is uploaded to an administrative organization
for billing, using public key encryption technology to
discourage tampering and to protect the secrecy of this
information.

The end-user gets a monthly bill for their usage of each
top-level component. Their payments are credited to each
component's owner in proportion to usage. These accounts are
then debited according to each application's usage of any
sub-components. These are credited to the sub-component
owners, again in proportion to usage. In other words, the
end-user's payments are recursively distributed through the
producer-consumer hierarchy. The distribution is governed by
usage metering information collected from each end-user's
machine, plus usage pricing data provided to the
administrative organization by each component vendor.

Since communication is infrequent and involves only a small
amount of metering information, the communication channel
could be as simple as a modem that autodials a hardwired 800
number each month. Many other solutions are viable, such as
flash cards or even floppy disks to be mailed back and forth
each month in the mails.

A Revolutionary Approach

Whereas software's ease of replication is a liability today
(by disincentivizing those who would provide it),
superdistribution turns this liability into an asset by
allowing software to be distributed for free. Whereas
software vendors must spend heavily to overcome software's
invisibility, superdistribution thrusts software out into
the world to serve as its own advertisement. Whereas the
personal computer revolution isolates individuals inside a
standalone personal computer, superdistribution establishes
a cooperative/competitive community around an information
age market economy.

Of course, there are many obstacles to this ever happening
for real. A big one is the information privacy issues raised
by usage monitors in every computer from video games to
workstations to mainframes. Although we are accustomed to
usage monitoring for electricity, telephone, gas, water and
electronic data services, information privacy is an
explosive political issue. Superdistribution could easily be
legislated into oblivion out of the fear that the usage
information would be used for other than billing purposes.

A second obstacle is the problem of adding usage monitoring
hardware to a critical number of computers. This is where
today's computing establishment could be gravely exposed to
those less inclined to maintain the status quo. It is
significant that superdistribution was not developed by the
American computer establishment, who presently controls 70%
of the world software market. It was developed by JEIDA, an
industry-wide consortium of Japanese computer manufacturers.

The Japanese are clearly capable of building world-class
computers. Suppose that they were to simply build
superdistribution capabilities into every one of them, not
as an extra-price option but as a ubiquitous capability of
every computer they build? What if the pair of
superdistribution metering instructions were built into
every next-generation CPU chip, much as ADD and JSR
instructions are built in today?

Review the benefits I've discussed in this column and then
ask: Whose computers would you buy? Whose computers would
Aunt Nellie and her friends buy? What if superdistribution
really is a Silver Bullet for the information age issues
that I've raised in this column? And what if the competition
builds it first?

Brad Cox, Ph.D.
Information Age Consulting
6603 Pelham Trace; Centreville VA 22020
703 968 8229 Voice 703 968 8798 Fax

Center  for the Study of Market Processes
Program on Social and Organizational Learning
George Mason University
4084 University Drive Suite 206; Fairfax VA 22030
703 993 1142 reception; 703 934 1578 fax
bcox@gmu.edu

[TM] Software-IC is a registered trademark of The Stepstone
Corporation; Sandy Hook CT.

[COX1] Brad J. Cox; Object-oriented Programming; An
Evolutionary Approach; Addison Wesley; 1986.

[COX2] Brad J. Cox; What, if anything, is an Object;
Addison Wesley; in development.
Planning the Software Industrial Revolution; IEEE Software; Nov 1990. There
is a Silver Bullet; Byte; Oct 1990.

[MORI] Ryoichi Mori and Masaji Kawahara; Superdistribution:
An Overview and the Current Status; Technical Research
Reports of the Institute of Electronics, Information and
Communication Engineers Vol 89 #44. What lies ahead; Byte;
Jan 1989; pp 346-348. On Superdistribution; Byte;  Sep 1990;
p 346.

--
Brad Cox; Coalition for Electronic Markets
George Mason Program on Social and Organizational Learning
Fairfax VA; bcox@gmu.edu; 703 968 8229 voice 968 8798 fax

[CNI Home Page]