August 07, 2003
Compulsory Licensing Cont'd: Ernie Miller on Pho, In Response to Derek Slater

Derek, in response to my Pho post on the gaming of compulsory licensing systems and watermarks, writes this (my post is included) on Fisher's latest. (see this for more of the conversation over time. It started at Greplaw.)

And Ernie responds 07 Aug 03, 10:11am PST:

I think your assumption that there will be a relatively weak urge to game the system is highly questionable. We're not really sure what the market will look like for music if P2P is fully legitimate. If music is entirely freely available (except for the bandwidth - and anyone who is paying a flat fee has some they aren't using, many with significant amounts) for unrestricted distribution, it is not clear to me that the costs of gaming the system will be particularly high. If the costs of gaming the system aren't high, then a relatively weak urge to game the system will be enough to get people to game the system.

Furthermore, until you actually provide specific details of the proposed system to be implemented, various weaknesses will not be able to be identified and gaming strategies developed. Talking in the abstract is fairly meaningless in this case. There will be an incentive to game any system, the question is simply whether gaming it will be cost effective. We can't make that call until we have details on the proposed system.

Here are a few incentives for gaming the system:

How much money would the artist/publisher/whoever get per download? $0.05, $0.01, $0.005? Does it really matter? No, because then I will pay people less than what I recoup to download my song. In the above case, I'll pay people either $0.02, $0.005 or $0.0025 everytime they download my song. People will gladly join such systems when they have flat fee connections. What do I care if my computer spends all night downloading songs and subsequently deleting them from my hard drive, if I can get a few bucks a month taken off my "licensing fee" or however the powers-that-be derive money from me?

Think such a system would be easy to stop? There is a serious incentive to figure out ways to do the above. Heck, perhaps you could get a "payola" law passed that would keep record industry types or artists from paying people to download for pay (P2Payola?). The original payola law sure worked wonders, until "independent promoters" filled the gap.

Or perhaps you would have clever algorithms that would try to figure out when people are trying to game the system under such a P2Payola scheme. Design one, and someone clever will shortly figure out a way around it. Perhaps people will develop sharing programs for this purpose. Instead of SETI@home, we'll have P2Payola@home.

Of course, even definining P2Payola would be tough. If a record company were giving out "virtual lottery tickets" to get a backstage pass to a concert if people downloaded the song from their website, would that be illegal? Would that not be counted towards their share of the pie? What about access to a "members-only" section of the website?

You could also have a contest ... $10,000 to the team or group that has the highest number of verified downloads that get around any theoretical anti-P2Payola system. A prize like that would get some nice attention I think, and really clever people working on the problem. I could imagine there might be some people who really, really don't like the RIAA or MPAA and would be happy to put up the money for such a prize. You could outlaw such prizes, but we start to enter some real interesting territory on what is or is not illegal.

Still think the monetary incentive isn't enough? There are many other incentives that are pretty strong, given that downloading on a flat flee connection will be relatively cheap.

Remember the Dixie Chicks? Pretty harsh how many radio stations stopped playing their music because one of their members expressed a sentiment that many people agreed with. Well, first thing I would do, if I were a clever programmer who agreed with that sentiment, would be to develop a small app that would download Dixie Chicks songs day and night to make up for the revenue they were losing from the radio stations. Undoubtedly, many sympathetic types would be happy to join me in such an effort.

How difficult would it be to develop and distribute P2Politics, my theoretical program that will allow you to get your music with all the efficiency of the best P2P programs, and support your favorite political positions at the same time. Download all Lee Greenwood all the time (when you aren't doing something more important with your internet connection, anyway).

Uh oh, hard to make this type of effort illegal. You would be stomping all over political speech if you tried. Sure, it might be possible to make a law that passes Constitutional muster (though unlikely), but do you really want to stop people from voting with their downloads?

Of course, the above ideas don't require any changes to watermarks or anything of that nature.

As far as changing lots and lots of watermarks ... lots of people would be happy to punish Lars Ulrich of Metallica if he says something they think is stupid again. Again ... one clever person cracks it and develops an easy-to-use system for taking advantage of the crack ... millions of average users can use it. This is something the average user can really get behind. Beats the ineffective boycotts everyone is constantly being asked to join on The Register and Slashdot. You could actually do something about it. Would enough join to make a difference? I think for some causes and against some people/organizations, yes ... a serious difference, that your system will have to thwart. Will it be a crime to do this? If not, I think there will be enough incentive that it will be done. If it is a crime ... is that better than our current system?

Hmmmm ... a central registry that will be checked periodically. Very nice. After you've explained the details of your system for thwarting all sorts of ways to game the system, perhaps you would explain the details of the registry and tracking system and show how these could not be exploited to violate people's privacy. Hopefully, your explanation will also take into account how this system will work in conjunction with proposed trusted computing initiatives, such as Palladium, as well as the incentives many will have to violate users privacy.

Ernest Miller

Update: Derek has the rest of the conversation here.

Posted by Mary Hodder at August 07, 2003 04:33 PM | TrackBack

Rant rant rant. While it's important to consider the gaming strategies that may evolve in a compulsory licensing system, keep in mind that policing those systems will be the RIAA's job and one that they will almost certainly be better at than trying to stop file-sharing. If you outlaw payment systems for downloading and use blended sampling techniques, you're not going to give much incentive to seriously game the system to anyone except the artists themselves. With an ever increasing sample size (100 million wouldn't surprise me once it's legal), even dedicated gamers would have to generate huge spikes in usage to alter the true trends in music listening.

Posted by: Jason Schultz on August 8, 2003 10:55 PM
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