Ideas should be free
At a certain point it will become more expensive to prevent counterfeiting of ideas than any profit garnered through protection. At that point ideas will become free.
This has important implications for patents, as well as the already obvious music and movie industries, and the more aware newspaper industry.
The WSJ is dead if they don’t open the gate as NY Times has done.
Besides, anything worth reading is already on the blogs.
Increasingly, patents are applied for without any interest in whether they are granted. Intellectual property is non-rival and has zero marginal cost. It is and will be free.
The best analogy to my mind to date is the Vanderbilt ferry from NY to NJ. Read the whole story in Myth of the Robber Barrons.
Vanderbilt stopped charging for rides on his ferry across the Hudson. The ride was free. He made all his money off concessions sold on board, which were sold at a competitive rate.
Burger King makes all its money off of soda.
The internet makes all of its money from advertising.
And advertising keeps getting better and better. Less and less obtrusive. More and more permeating.
In Demolition Man, a Sylvester Stalone / Sandra Bullock plastic movie version of Brave New World, the people listen to nothing but advertising all the time on the radio. And a man has to cuss to get TP.
Get used to advertising. Get unused to patents.
I’m very optimistic right now.
Comments
4 Responses to “Ideas should be free”
Interesting post. I’ve recently become fascinated by the idea that patents might be inefficient. It’s almost universally accepted that patents protect property rights, but I’m not so sure.
First, it seems morally right that if I buy something, I should be allowed to take it apart, see how it works, improve it, sell my own version of it, etc. After all, I bought it. Isn’t it the responsibility of the inventor to figure out how to make profit from his invention.
Second, would cavemen have invented the hammer or the wheel if they hadn’t first invented the patent?
Third, there are lots of reasons people might come up with the same idea at roughly the same time - world events, natural technological evolution. Should inventors spend their time rushing to the patent office, or rushing to get their invention to market?
Finally (demonstrating potentially unprecendented faith in the invisible hand), I’m also concerned that patents might encourage resources to shift
towards developing patent worthy technologies (those with high development costs) as opposed to the most naturally demanded technologies. The result might be that you end up with a lot of premature industries (maybe drugs for restless leg syndrome) and a lot of underdeveloped industries (maybe solar energy). Even without patents, there would be huge incentives for manufacturers, distributors, service providers, etc to encourage the development of cheaper energy. You could hypothesize that without patents, we might have had solar powered cars 20 years ago. The availability of nearly free transportation would dramatically reduce the cost of almost everything. New drug development might only cost $5 million in ‘07 instead of $80 million, and we might have cured cancer and restless heart syndrome by now.
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I like your final point here. If there is an explanation for how this might divert resources away from economic development I’d be very interested. You suggest that more work has gone into solving restless leg syndrome than solar power. This particular example is unlikely, but the idea sticks, and I believe it may have to do with elasticities of demand for each good under monopoly conditions.
Very complicated analysis to get at that idea, and I’m more skeptical than I have been of such stories, but there’s still a little part of my mind sympathetic to them.
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Yeah, my example may not be the greatest. I just came up with this about a month ago, and the concept is so abstract, that trying to accurately estimate how technologies would otherwise evolve is beyond my abilities. I chose energy vs restless leg drugs (RLDs) to demonstrate an extreme possibility - not necessarily because I believe it.
The idea is based on the idea that the most needed new technologies are the ones that offer the best NPV. If society would benefit from A more than B [and NPV(A)>NPV(B)], then scientists and VCs will invest in inventing A. Maybe A is a solar powered graphics calculator, and B is an RLD. Developing an RLD (option B) might cost $80M, take 4 years to develop, benefit only a few people, and be immediately copied upon introduction (w/o protection). Option A might take 6 months, cost $100K to develop, benefit lots of people, and could also be immediately copied. NPV(A) is likely > NPV(B). A’s profits are short-run, but atleast they are profits. While competitors are copying A, our firm is already working on a solar PDA/laptop/car/bus/train…
Alternatively, in a world with patents NPV(B) might be > NPV(A) (even though the world might be better off with A). There are various reasons this might be the case. For instance maybe even if we patented A a competitor might be able to go straight to inventing the solar cell for a pda or laptop. By B’s nature, it’s patent might offer much more protection and possibly much more profit, because of less elastic demand, etc. So A never gets invented, and scientists chase after a bunch of B-esque technologies.
Since, in this theoretic the evolution of solar energy might have aided in the development of B, it could take a world with patents much longer to invent both.
Let me know if this explanation makes more/any sense.
Another idea: it could also be argued that without patents, drug companies might try to invent cures as opposed to symptom treaters.
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I couldn’t understand some parts of this article Ideas should be free, but I guess I just need to check some more resources regarding this, because it sounds interesting.
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