Will technology kill book publishers?
July 28, 2010
Amazon announced last week that it has sold more e-books than hardcover books.
At the same time, the Wylie literary agency has announced a number of big publishing deals bypassing the traditional publishing houses, and going straight into online publishing.
So, e-books are now more important than traditional books. More e-books are sold, and more money will soon be made from e-books than traditional books.
So what will happen with the traditional publishers? Will they go the same way as the music industry (a decline of more than 50% in less than 10 years)? Or will it go even faster?
One reason often put forward why this may not necessarily be the case is of course the selection role played by traditional publishers.
We all have that book in us – that’s an awful lot of books, and if we’re honest, we know that a lot of those books should maybe be written, but not necessarily read – or published.
However, those who think that traditional publishing will survive, miss three important points of the technological revolution around e-books.
The first is the low cost of publishing. As with music, the cost will drop to zero. Entry into the market, and the possibility of piracy, will also have a big effect on e-books. Technical protection against piracy? I’ll believe it when I see it.
The second is the role of technology. There is no reason why a clever publisher (or IT person) would not develop a software application that would do most of the selection of publishable material for you. I’m pretty sure it is possible for a clever algorithm to be developed, that will be able to select, between millions of manuscripts submitted, the ten (or hundred) candidates for blockbusters, or literary talent, or both.
The third is the role of crowdsourcing. When everyone will be able to post their writings (as an e-book) online, the power of crowdsourcing will be able to play an important filtering and selection role.
So I’m not convinced that publishing, as such, has much of a future.
Business models for software : 3D-IT.
June 21, 2010
Business models for software are typically pretty simple: the software is sold under a License, as a Service or in a combination of License and Services (e.g. SaaS).
I believe this model is very unsatisfactory.
Why? Because it does not really distinguish between the different aspects that constitute the specific value proposition of the software concerned.
Whether you offer a software under a license or as a service is typically not really determined by the real value proposition, but by the way customers (are perceived to) want to pay for the software.
I want to propose a better model of determining which business model is appropriate for software, based on the three dimensions I see in software.
These three dimensions are: Technology, Functionality and Content. What do they represent?
For some software products, most or all of the value is in technological development. Examples are Operating Systems, development platforms, middleware, interfaces, etc…
Other products will mainly focus on functionality. Most software applications will fall into this category, from office applications over plug-ins to computer games, including most SaaS, which is functionality offered on-line.
Finally, some products will focus mainly on content. This will apply to a lot of Internet business (e.g. Wikipedia, but also Google and Facebook), but also to a lot of business intelligence software, databases and media content.
Of course, hardly any software belongs to one category only. Every offering will effectively be three-dimensional: the software will address some or more Technology issues, focus less or more on Functionality, and be based more or less on or around the Content created or manipulated by it.
However, positioning a software business on the right place of each dimensional axis of our 3D model will be essential in understanding which business model is most appropriate.
Each axis of each dimension will range from commodity to highly specialized or tailored.
Knowing where your software product sits in this 3D model, will allow you to understand much better whether the real value of the software is better captured in a license model, a subscription model, a content purchase model, or any other model.
Because you will know where to locate the real value created by the software.
And then, once you know this, you can integrate the correct protection (Intellectual Property) and license model to your business.
That can be done through any range of IP tools, from strict patents to fully copyleft open source.
As a result, when properly located in this 3D-IT model, the business will be able to identify its most valuable assets, protect them properly (through use of appropriate IP tools), and use them most efficiently in the business model
Software written by software – for real this time
April 16, 2010
In earlier posts on this blog, I have written about who owns software written by software. It is my position that such “Written Code” falls outside the protection of copyright.
This is because the Written Code is generated by Writing Software, without human intervention on the actual choice of code used to express the functionality.
Human intervention is limited to instructing the Writing Software on the details of the functionality (the Specs).
Under copyright, only the actual Written Code could be protectable, not the functionality described in the Specs.
And since the actual Written Code is not written by a human being, and there is no human creativity involved in generating the Written Code, there is no copyright. The fact that there may be creativity involved in providing the instructions to the Writing Software, is irrelevant in respect of the Written Code.
It’s applying the distinction between an idea and its expression.
This week, I was asked by a client to review the licensing model of a software product.
It turned out that the client/provider was also offering a license to a development tool to its end-users. This tool enables the end-user to create additional functionality to an existing product (which must already be licensed from the client/provider).
An end-user challenged the IP ownership of such additional functionality to be created by the tool, and wanted to own the IP (rather than the client/provider, who standard claims IP on any functionality created by the tool, even when such functionality is created by end-users using the tool licensed by them from the client/provider).
However, according to my theory on who owns software written by software, the question is moot from a copyright point of view. Nobody owns copyright in the functionality created by the tool , because there is no copyright. Such functionality is expressed through Written Code, i.e. created by artificial intelligence.
Besides, it would be unreasonable for the end-user to ask for a monopoly on additional functionality, added to a standard product. Copyright does not cover functionality in software, it can cover only the code through which functionality is expressed (if such code is written by a human being).
By analogy, you cannot claim a monopoly (IP rights) on a specific macro you’ve written in Excel – anybody can recreate such macro.
So far, so good (although the end-user may turn out to be unhappy about this).
But what happens when the client/provider starts to use this tool exclusively in the development of a whole new application? Does that mean that such application cannot be licensed under copyright?
Well, yes.
I wonder how many software companies out there are licensing stuff that has no copyright protection?
Software written by software – help, no copyright!
April 12, 2010
No copyright!
As we’ve seen in my last blog, my position is that software written by other software falls outside the scope of protection of copyright.
Why?
Because no human intervention occurs in the actual generation of the code itself, which means no human creativity intervenes at that level.
There is human creativity in the instructions given to the Writing Software, but those instructions are ideas or algorithms, which are not protectable under copyright.
What does that mean?
It means that any code (or content, for that matter) originated by software, falls necessarily in the public domain in terms of copyright.
Does that mean that nobody owns it? Well, not exactly.
It would still be possible for the licensor of the original Writing Software to determine in the license to the Writing Software who would be owner of the resulting code. However, that is a very awkward position. It would be like Apple (can’t always use Microsoft as the baddies) saying: any automated part of your song generated through use of Garageband is owned by Apple.
It wouldn’t be fair, and it probably wouldn’t work.
It wouldn’t be fair, because Apple is not actually involved in the production of the music. And of course, what would be next? Microsoft owning the content of this blog, because I wrote the first draft on Word software (sorry, force of habit)?
It wouldn’t work, because since the music created by Garageband would fall outside copyright (not created by a human), Apple would have no efficient legal tools to enforce their position. The reason for that is that the legal tools given to copyright holders are much stronger than the legal tools available under contract – in short, it would most probably not be cost efficient to start suing people because they are in breach of a contract stating who owns code or content.
Does that mean that software becomes unprotectable?
Some of it, yes.
Is that a problem?
Not necessarily. The best explanation is – again – in the EU legislation on applying copyright to software. The first relevant consideration states literally:
“Whereas (…) the development of computer programs requires the investment of considerable human, technical and financial resources while computer programs can be copied at a fraction of the cost needed to develop them independently.”
Let’s think for ourselves, rather than accepting a piece of legislation as truth from above.
Is this consideration, which is absolutely essential to the underlying reasoning of applying copyright to software, still true?
Well, when software develops other software, the marginal cost of developing another application quickly drops to zero as well!
It’s like a derivative of Moore’s Law: the cost of an application or functionality drops by factor x over y time (someone ought to check it).
If developing an application costs close to nothing, why apply a legal monopoly with a duration of at least 70 years to protect anyone from copying it, as copyright does? Does legislation like this, based on a fundamentally incorrect premise, still make sense?
The best illustration that there is a whole field of software being developed that has little to no value in the market, and that typically represents basic functionality, is the enormous market of applications that has sprung to life for smartphones (Mac-, Android or Symbian based).
Most of the “simple” applications are offered at no fee, or a very small one.
Again, what’s the point of throwing the mantle of copyright, including its criminal liability and heavy penalties, on something that, although easy to copy, has very low development cost, and is generated by software?
So – a bit of a paradigm shift, and we’ve only seen the beginning, as this article in the Guardian shows
Does that mean that all software becomes unprotectable? No. As with content (and technology), high-end and high-value functionality will still be protected, and charged for. It’s simple economics really: if it has high enough value, it should be protected, and the law should provide the right tools for that protection. However, the borders will continue to shift.
Next time, we’ll look at two more interesting questions raised by all this:
- In the heel of the hunt, who is the author/owner of software or content created by software?
- What will be the position on anything created by artificial intelligence (AI)?
Joren De Wachter
Who owns software written by software (part 3)
March 31, 2010
In the two previous posts, I discussed that
- there is a new development: software that is developed automatically, by other software, based on human instructions, but without humans writing any actual code;
- if we want to know how owns that code, we need to look primarily at copyright.
In the mean time, also, my full legal article on the issue has been published in Computer law review international.
So, what is the copyright status of software written by software?
“Written Code” (code written by “Writing Software”) is, technically, like other code. It is a human readable expression of the instructions that will be compiled into machine language by a compiler.
However, the Written Code is generated by another piece of software (or artificial intelligence, if you will), on the basis of general instructions given by the human user of the Writing Software.
What does that mean? It means that the human user of the Writing Software will formulate general instructions (like defining objects, describing relationships between objects, or drawing an algorithm). Based on those instructions, the Writing Software will generate (“write”) the code.
The distinction between the instructions and the code is a very important distinction – it will be instrumental in determining whether Written Code is protected by copyright, the topic of this blog.
It is instrumental because copyright is actually a rather awkward format of Intellectual Property protection for software. That is because copyright, created way back in the 19th century as a legally imposed monopoly on reproduction and distribution, was designed to provide protection to expressions of creativity. And software code is of course an expression of technical efficiency, rather than creativity.
However, in the seventies, when the IP protection of software was discussed, it was decided to opt for the use of copyright as the IP tool for protecting software, mainly because patents were even less appropriate, rather expensive and mostly inefficient for the purpose of protecting software, and because nobody wanted to devise a new, software specific, IP right.
The creativity was deemed to be in the original creation of the code.
Created, of course, by humans – except that that assumption was never really stated as such. But, it solved the creativity threshold problem, and therefore, copyright could apply to software.
The consequence of that choice, though, is that the distinction between an idea and its expression, which is so important for copyright protection, also applies to software copyright protection.
The best way to explain the distinction between an idea and its expression is as follows: the idea “My Baby Left Me This Morning, I’m Feeling Blue” is not protected; however, the thousands of blues songs based on that idea, to the extent each of these songs is not a copy of another song (there are specific rules for that, ask Madonna) are each individually protected by copyright. So, you can always write a new song on this theme, as long as your song, the specific expression of the general idea, is sufficiently new or original.
The analogy with software goes more or less like this: functionality in software (say, an automated back-up function) is not protected, but the code in which it is expressed is. It’s not a perfect analogy, but it is sufficient for our purpose.
Because, as we have seen, the user of Writing Software only expresses generic instructions “ideas”, and the Writing Software writes the code, the “expression”. It would be as if you instructed a software program to write a song about the theme “My Baby Left Me This Morning, I’m Feeling Blue”, and it came up with a twelve-bar blues in Bb, with a nice melody line that could have been played by Eric Clapton and some awkward, unhappy lyrics…
Note however, that the dividing line between “ideas” and “expressions” is not a clear-cut transition, there’s a lot of uncertainty where one ends and the other begins, even in very specialized legal literature.
Coming back to our software: what that means is that, for Written Code, it is the Writing Software that creates the bit with originality (the “expression”), that is supposed to be covered by copyright. The human originality is limited to the instructions (the “ideas”).
The interesting conclusion is that both elements that are involved in generating Written Code would fall outside the scope of copyright protection.
The first element – the instructions – falls within the category “ideas”. Look at the European Directive on Software Protection: underlying algorithms clearly fall outside the protection for software.
The second element, the code, contains no human creativity, and fails to pass the originality threshold required for copyright protection.
Hence, no copyright protection for software written by software.
Is that a problem?
Not necessarily so – I’ll talk about that in my next blog.
Joren De Wachter
