[Plura-list] Patent troll IP is more powerful than Apple's; Podcasting "Free Markets"

[Cory Doctorow]

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On Wednesday night, I'm participating in a Clarion Writing Workshop
panel called "Balancing Worldbuilding and Narrative," with Karen Osborne
and Kali Wallace

https://ucsd.zoom.us/webinar/register/WN_YSvD5IjGS7Su2z-xhQN1ZA

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Today's links

* Patent troll IP is more powerful than Apple's: Sauce for the goose is
sauce for the gander.

* Podcasting "Free Markets": Taxation without representation.

* This day in history: 2006, 2011, 2016, 2020

* Colophon: Recent publications, upcoming/recent appearances, current
writing projects, current reading

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👅 Patent troll IP is more powerful than Apple's

I was 12 years into my Locus Magazine column when I published the piece
I'm most proud of, "IP," from September 2020. It came after an epiphany,
one that has profoundly shaped the way I talk and think about the issues
I campaign on.

https://locusmag.com/2020/09/cory-doctorow-ip/

That revelation was about the meaning of the term "IP," which had been
the center of this tedious linguistic cold war for decades. People who
advocate for free and open technology and culture hate the term "IP"
because of its ideological loading and imprecision.

Ideology first: Before "IP" came into wide parlance - when lobbyists for
multinational corporations convinced the UN to turn their World
Intellectual Property Organization into a specialized agency, we used
other terms like "author's monopolies" and "regulatory monopolies."

"Monopoly" is a pejorative. "Property" is sacred to our society. When a
corporation seeks help defending its monopoly, it is a grubby corrupter.
When it asks for help defending its property, it is enlisting the public
to defend the state religion.

Free culture people know allowing "monopolies" to become "property"
means losing the battle before it is even joined, but it is frankly
unavoidable. How do you rephrase "IP lawyer" without conceding the
property point? "Trademark-copyright-patent-and-related-rights lawyer?"

Thus the other half of the objection to "IP": its imprecision. Copyright
is not anything like patent. Patent is not anything like trademark.
Trade secrets are an entirely different thing again. Don't let's get
started on sui generis and neighboring rights.

And this is where my revelation came: as it is used in business circles,
"IP" has a specific, precise meaning. "IP" means, "Any law, policy or
regulation that allows me to control the conduct of my competitors,
critics and customers."

Copyright, patent and trademark all have limitations and exceptions
designed to prevent this kind of control, but if you arrange them in
overlapping layers around a product, each one covers the exceptions in
the others.

Creators don't like having their copyrights called "author's
monopolies." Monopolists get to set prices. All the copyright in the
world doesn't let an author charge publishers more for their work. The
creators have a point.

But when author's monopolies are acquired by corporate monopolists,
something magical and terrible happens.

Remember: market-power monopolies are still (theoretically) illegal and
when companies do things to maintain or expand their monopolies, they
risk legal jeopardy.

But: The corporate monopolist who uses IP to expand their monopoly has
no such risk. Monopolistic conduct in defense of IP enjoys wide
antitrust forbearance. What's the point of issuing patents or allowing
corporations to buy copyrights if you don't let them enforce them?

The IP/market-power monopoly represents a futuristic corporate alloy, a
new metal never seen, impervious to democratic control.

Software is "IP" and so any device with software in it is like beskar, a
rare metal that can be turned into the ultimate corporate armor.

No company exemplifies this better than Apple, a company that used
limitations on IP to secure its market power, then annihilated those
limits so that no one could take away its market power.

https://www.eff.org/deeplinks/2019/06/adversarial-interoperability-reviving-elegant-weapon-more-civilized-age-slay

In the early 2000s, Apple was in trouble. The convicted monopolist
Microsoft ruled the business world, and if you were the sole Mac user in
your office, you were screwed.

When a Windows user sent you a Word file, you could (usually) open it in
the Mac version of Word, but then if you saved that file again, it often
became forever cursed, unopenable by any version of Microsoft Office
ever created or ever to be created.

This became a huge liability. Designers started keeping a Windows box
next to their dual processor Power Macs, just to open Office docs. Or
worse (for Apple), they switched to a PC and bought Windows versions of
Adobe and Quark Xpress.

Steve Jobs didn't solve this problem by begging Bill Gates to task more
engineers to Office for Mac. Instead, Jobs got Apple techs to
reverse-engineer all of the MS Office file formats and release a rival
office suite, Iwork, which could read and write MS Office files.

That was an Apple power move, one that turned MS's walled garden into an
all-you-can-eat buffet of potential new Mac users. Apple rolled out the
Switch ads, whose message was, "Every MS Office file used to be a reason
*not* to use a Mac. Now it's a reason to switch *to* a Mac."

More-or-less simultaneously, though, Apple was inventing the hybrid
market/IP monopoly tool that would make it the most valuable company in
the world, in its design for the Ipod and the accompanying Itunes store.

It had a relatively new legal instrument to use for this purpose: 1998's
Digital Millennium Copyright Act; specifically, Section 1201 of the
DMCA, the "anti-circumvention" clause, which bans breaking DRM.

Under DMCA 1201, if a product has a copyrighted work (like an operating
system) and it has an "access control" (like a password or a bootloader
key), then bypassing the access control is against the law, even if no
copyright infringement takes place.

That last part - "even if no copyright infringement takes place" - is
the crux of DMCA 1201. The law was intended to support the practices of
games console makers and DVD player manufacturers, who wanted to stop
competitors from making otherwise legal devices.

With DVD players, that was about "region coding," the part of the DVD
file format that specified which countries a DVD could be played back
in. If you bought a DVD in London, you couldn't play it in Sydney or New
York.

Now, it's not a copyright violation to buy a DVD and play it wherever
you happen to be. As a matter of fact, buying a DVD and playing it is
the *opposite* of a copyright infringement.

But it *was* a serious challenge to the entertainment cartel's
business-model, which involved charging different prices and having
different release dates for the same movie depending on where you were.

The same goes for games consoles: companies like Sega and Nintendo made
a lot of money charging creators for the right to sell games that ran on
the hardware they sold.

If I own a Sega Dreamcast, and you make a game for it, and I buy it and
run it on my Sega, that's not a copyright infringement, even if Sega
doesn't like it. But if you have to bypass an "access control" to get
the game to play without Sega's blessing, it violates DMCA 1201.

What's more, DMCA 1201 has major penalties for "trafficking in
circumvention devices" and information that could be used to build such
a device, such as reports of exploitable flaws in the programming of a
DRM system: $500k in fines and a 5 year sentence for a first offense.

Deregionalizing a DVD player or jailbreaking a Dreamcast didn't violate
anyone's copyrights, but it still violated copyright law (!). It was
pure IP, the right to control the conduct of critics (security
researchers), customers and competitors.

In the words of Jay Freeman, it's "Felony contempt of business-model."

And that's where the Ipod came in. Steve Jobs's plan was to augment the
one-time revenue from an Ipod with a recurrent revenue stream from the
Itunes store.

He exploited the music industry's superstitious dread of piracy and
naive belief in the efficacy of DRM to convince the record companies to
only sell music with his DRM wrapper on it - a wrapper they themselves
could not authorize listeners to remove.

Ever $0.99 Itunes purchase added $0.99 to the switching cost of giving
up your Ipod for a rival device, or leaving Itunes and buying DRM music
from a rival store. It was control over competitors and customers. It
was IP.

If you had any doubt that the purpose of Ipod/Itunes DRM was to fight
competitors, not piracy, then just cast your mind back to 2004, when
Real Media "hacked" the Ipod so that it would play music locked with
Real's DRM as well as Apple's.

http://www.internetnews.com/bus-news/article.php/3387871/Apple+RealNetworks+Hacked+iPod.htm

Apple used DMCA 1201 to shut Real down, not to stop copyright
infringement, but to prevent Apple customers from buying music from
record labels and playing them on their Ipods without paying Apple a
commission and locking themselves to Apple's ecosystem, $0.99 at a time.

Pure IP. Now, imagine if Microsoft had been able to avail itself of DMCA
1201 when Iwork was developed - if, for example, its "information rights
management" encryption had caught on, creating "access controls" for all
Office docs.

There's a very strong chance that would have killed Apple off before it
could complete its recovery. Jobs knew the power of interoperating
without consent, and he knew the power of invoking the law to block
interoperability. He practically invented modern IP.

Apple has since turned IP into a trillion-dollar valuation, largely off
its mobile platform, the descendant of the Ipod. This mobile platform
uses DRM - and thus DMCA 1201 - to ensure that you can only use apps
that come from its app store.

Apple gets a cut of penny you spend buying an app, and every penny you
spend within that app: 30% (now 15% for a minority of creators after bad
publicity).

IP lets one of the least taxed corporations on Earth extract a 30% tax
from everyone else.

https://locusmag.com/2021/03/cory-doctorow-free-markets/

Remember, it's not copyright infringement for me to write an app and you
to buy it from me and play it on your Iphone without paying the 30%
Apple tax.

That's the exact opposite of copyright infringement: buying a
copyrighted work and enjoying it on a device you own.

But it's still an IP violation. It bypasses Apple's ability to control
competitors and customers. It's felony contempt of business-model.

It shows that under IP, copyright can't be said to exist as an incentive
to creativity - rather, it's a tool for maintaining monopolies.

Which brings me to today's news that Apple was successfully sued by a
patent troll over its DRM. A company called Personalized Media
Communications whose sole product is patent lawsuits trounced Apple in
the notorious East Texas patent-troll court.

https://www.bloomberg.com/news/articles/2021-03-19/apple-told-to-pay-308-5-million-for-infringing-drm-patent

After software patents became widespread - thanks to the efforts of
Apple and co - there was a bonanza of "inventors" filing garbage patents
with the USPTO whose format was "Here's an incredibly obvious
thing...*with a computer*." The Patent Office rubberstamped them by the
million.

These patents became IP, a way to extract rent without having to make a
product. "Investors" teamed up with "inventors" to buy these and impose
a tax on businesses - patent licensing fees that drain money from people
who make things and give it to people who buy things.

They found a court - the East Texas court in Marshall, TX - that was
hospitable to patent trolls. They rented dusty PO boxes in Marshall and
declared them to be their "headquarters" so that they could bring suits
there.

Locals thrived - they got jobs as "administrators" (mail forwarders) for
the thousands of "businesses" whose "head office" was in Marshall (when
you don't make a product, your head office can be a PO box).

Productive companies facing hundreds of millions - billions! - in patent
troll liability sought to curry favor with locals (who were also the
jury pool) by "donating" things to Marshall, like the skating rink
Samsung bought for the town.

https://hbswk.hbs.edu/item/why-south-korea-s-samsung-built-the-only-outdoor-skating-rink-in-texas

Patent, like copyright, is supposed to serve a public purpose. There are
only two clauses in the US Constitution that come with explanations (the
rest being "truths held to be self-evident"): the Second Amendment and
the "Progress Clause" that creates patents and copyrights.

Famously, the Second Amendment says you can bear arms as part of a
"well-regulated militia."

And the Progress Clause? It extends to Congress the power to create
patents and copyrights "to promote the Progress of Science and useful Arts."

I'm with Apple in its ire over this judgment. Sending $308.5m to a
"closely held" patent troll has nothing to do with the "Progress of
Science and useful Arts."

But it has *everything* to do with IP.

If copyright law can let Apple criminalize - literally criminalize - you
selling me If copyright law can let Apple criminalize - literally
criminalize - you selling me your copyrighted work, then there's no
reason to hate on patent trolls.

They're just doing what trolls do: blocking the bridge between someone
engaged in useful work and the customers for that work, and extracting a
toll. It's not even 30%.

There is especial and delicious irony in the fact that the patent in
question is a DRM patent: a patent for the very same process that Apple
uses to lock down its devices and prevent creators from selling to
customers without paying the 30% Apple Tax.

But even without that, it's as good an example of what an IP marketplace
looks like: one in which making things becomes a liability. After all,
the more you make, the more chances there are for an IP owner to demand
tax from you to take it to market.

The only truly perfect IP is the naked IP of a patent troll, the bare
right to sue, a weapon made from pure abstract legal energy, untethered
from any object, product or service that might be vulnerable to another
IP owner's weapons.

A coda: you may recall that Apple doesn't use DRM on its music anymore:
you can play Itunes music on any device. That wasn't a decision Apple
took voluntarily: it was forced into it by a competitor: Amazon, an
unlikely champion of user rights.

In 2007, the record labels had figured out that Apple had lured them
into a trap, selling millions of dollars worth of music that locked both
listeners and labels into the Itunes ecosystem.

In a desperate bid for freedom, they agreed to help Amazon launch its
MP3 store - all the same music, at the same prices...without DRM.
Playable on an Ipod, but also on any other device.

Prior to the Amazon MP3 store, the market was all DRM: you could either
buy Apple's DRM music and play it on your Ipod, or you could buy other
DRM music and play it on a less successful device.

The Amazon MP3 store (whose motto was "DRM: Don't Restrict Me") changed
that to "Buy Apple DRM music and play it on your Ipod, or buy Amazon
music and play it anywhere." That was the end of Apple music DRM.

So why hasn't anyone done this for the apps that Apple extracts the 30%
tax on? IP. If you made a phone that could play Ios apps, Apple would
sue you:

https://gizmodo.com/judge-tosses-apple-lawsuit-against-iphone-emulator-in-b-1845967318

And if you made a device that let you load non-App Store apps on an
Iphone, Apple would also sue you.

Apple understands IP. It learned the lesson of the Amazon MP3 store, and
it is committed to building a world where every creator pays a tax to
reach every Apple customer.

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👅 Podcasting "Free Markets"

Today on my podcast, a readloud of "Free Markets," my March 2021 Locus
Magazine column on the way that tech platforms have found a way to
interpose themselves between creators and audiences in order to extract
a 30% tax.

https://locusmag.com/2021/03/cory-doctorow-free-markets/

The resulting markets are "free" from government regulation (especially
antitrust law), but they are in every other respect unfree: reaching the
market involves paying a tollkeeper who also gets to decide whose
products can be sold at all.

Here's the podcast ep:

https://craphound.com/podcast/2021/03/22/free-markets/

and here's the MP3 (hosting courtesy of the @internetarchive, they'll
host your files for free, forever):

https://archive.org/download/Cory_Doctorow_Podcast_381/Cory_Doctorow_Podcast_381_-_Free_Markets.mp3

and here's the RSS feed for my podcast:

http://feeds.feedburner.com/doctorow_podcast

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👅 This day in history

#15yrsago Airport screening doesn’t stop knives, bombs, or guns
https://www.schneier.com/blog/archives/2006/03/airport_passeng.html

#15yrsago Vinge’s scientific computing Nature article about MMORPGs
https://www.nature.com/articles/440411a

#15yrsago Apple’s hypocritical slam against French DRM-interop law
http://news.bbc.co.uk/2/hi/technology/4833010.stm

#10yrsago Google Book Search rejected: why not try fair use instead?
https://arstechnica.com/tech-policy/2011/03/judge-rejects-google-book-monopoly/

#10yrsago HOWTO play the opening chord from ‘A Hard Day’s Night’
https://www.beatlesbible.com/features/hard-days-night-chord/

#10yrsago Why Rasputin isn’t in the Haunted Mansion
https://longforgottenhauntedmansion.blogspot.com/2011/03/famous-ghosts-and-ghosts-trying-to-make.html

#5yrsago Anti-DRM demonstrators picket W3C meeting
https://www.eff.org/deeplinks/2016/03/scenes-anti-drm-protest-outside-w3c

#5yrsago Silverpush says it’s not in the ultrasonic audio-tracker
ad-beacons business anymore
https://www.vice.com/en/article/9a3k4y/silverpush-ftc-stop-eavesdropping-with-audio-beacons

#5yrsago US Embassy staffer ran a sextortion racket from work computer
for 2 years
https://arstechnica.com/tech-policy/2016/03/former-us-embassy-staffer-sentenced-to-nearly-five-years-for-sextortion/

#1yrago How "concierge doctors" supply the "worried well" with masks,
respirators and tests
https://pluralistic.net/2020/03/22/preppers-are-larpers/#concierge-medicine

#1yrago Law firm tells work-from-homers to switch off smart speakers
https://pluralistic.net/2020/03/22/preppers-are-larpers/#dumb-choices

#1yrago How prepper media is coping with the crisis
https://pluralistic.net/2020/03/22/preppers-are-larpers/#preppers-unprepared

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👅 Colophon

Today's top sources: Slashdot (https://slashdot.org/).

Currently writing:

* My next novel, "The Lost Cause," a post-GND novel about truth and
reconciliation. Friday's progress: 511 words (118232 total).

* A short story, "Jeffty is Five," for The Last Dangerous Visions.
Friday's progress: 388 words (9273 total).

* A cyberpunk noir thriller novel, "Red Team Blues." Yesterday's
progress: 1057 words (36309 total).

Currently reading: Analogia by George Dyson.

Latest podcast: Free Markets
https://craphound.com/podcast/2021/03/22/free-markets/

Upcoming appearances:

*  Balancing Worldbuilding and Narrative (with Karen Osborne and Kali
Wallace), Mar 24,
https://ucsd.zoom.us/webinar/register/WN_YSvD5IjGS7Su2z-xhQN1ZA

* Launch for Brian David Johnson's Future You (Powell's Books), Mar 30,
https://zoom.us/webinar/register/5716148038801/WN_psgDGchIRfaUQOJyvLnvzw

* All the Teachable Things I Know About Writing, Apr 13,
https://www.changinghands.com/event/april2021/virtual-writing-workshop-cory-doctorow-all-teachable-things-i-know-about-writing

* Interop: Self-Determination vs Dystopia (FITC), Apr 19-21,
https://fitc.ca/presentation/interop/

Recent appearances:

* The surveillance state, digital monopolies, and why we should be
worried (Podsongs)
https://anchor.fm/podsongs/episodes/Cory-Doctorow-on-the-Surveillance-State--digital-monopolies--and-why-we-should-be-worried-eso43k

* Conspiracy Theories (Utopian Horizons):
https://soundcloud.com/utopianhorizons/conspiracy-theory-w-cory-doctorow

* Canadian Speculative Fiction (Unknown Worlds):
https://unknownworlds.podbean.com/e/canadian/

Latest book:

* "Attack Surface": The third Little Brother novel, a standalone
technothriller for adults. The *Washington Post* called it "a political
cyberthriller, vigorous, bold and savvy about the limits of revolution
and resistance." Order signed, personalized copies from Dark Delicacies
https://www.darkdel.com/store/p1840/Available_Now%3A_Attack_Surface.html

* "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet
analyzing the true harms of surveillance capitalism and proposing a
solution.
https://onezero.medium.com/how-to-destroy-surveillance-capitalism-8135e6744d59
(print edition:
https://bookshop.org/books/how-to-destroy-surveillance-capitalism/9781736205907)
(signed copies:
https://www.darkdel.com/store/p2024/Available_Now%3A__How_to_Destroy_Surveillance_Capitalism.html)

* "Little Brother/Homeland": A reissue omnibus edition with a new
introduction by Edward Snowden:
https://us.macmillan.com/books/9781250774583; personalized/signed copies
here:
https://www.darkdel.com/store/p1750/July%3A__Little_Brother_%26_Homeland.html

* "Poesy the Monster Slayer" a picture book about monsters, bedtime,
gender, and kicking ass. Order here:
https://us.macmillan.com/books/9781626723627. Get a personalized, signed
copy here:
https://www.darkdel.com/store/p1562/_Poesy_the_Monster_Slayer.html.

This work licensed under a Creative Commons Attribution 4.0 license.
That means you can use it any way you like, including commercially,
provided that you attribute it to me, Cory Doctorow, and include a link
to pluralistic.net.

https://creativecommons.org/licenses/by/4.0/

Quotations and images are not included in this license; they are
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basis of a separate license. Please exercise caution.

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"*When life gives you SARS, you make sarsaparilla*" -Joey "Accordion
Guy" DeVilla


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