Can you read any book you want to? Can you listen to all the music that has ever been recorded? Do you have access to any web page at all you wish to consult? Can you easily see your own medical record? Other people's medical records?
Historically questions like this would not have made much sense, as copying and distributing information was quite expensive. In the early days of writing, for instance, when humans literally copied text by hand, copies of books were rare, costly, and also subject to copy errors (unintentional or intentional). Few people in the world at that time had access to books, and even if some power had wanted to expand access, it would have been difficult to do so because of the immense cost involved.
In the age of digital information, when the marginal cost of making a copy and distributing it has shrunk to zero, all limitations on digital information are in a profound sense artificial. They involve adding cost back to the system in order to impose scarcity on something that is abundant. As an example, billions of dollars have been spent on trying to prevent people from copying digital music files and sharing them with their friends or the world at large .
Why are we spending money to make information less accessible? When information existed only in analog form, the cost of copying and distribution allowed us—to some degree required us—to build an economy and a society grounded on information scarcity. A music label, for instance, had to recruit talent, record in expensive studios, market the music (often by paying for radio airplay), and finally make and distribute physical records. Charging for the records allowed the label to cover its costs and turn a profit. Now individuals can produce music on their laptop and distribute it for free to the entire world, the fixed cost is dramatically lower and the marginal cost of a listen is zero. And with that the business model of charging per record, or per song, or per listen, and the extensive copyright protections required to sustain it no longer make sense. Despite the ridiculous fight put up by the music industry in the end we are winding up with listening that is either free (ad supported) or part of a subscription. In either case the marginal listen is free.
Despite this progress in music, we accept many other artificial restrictions on information access and distribution as a given because we, and a couple of generations before us, have grown up with them. This is the only system we know and much of our personal behavior, our public policies and our intellectual inquiries are shaped by what we and our recent ancestors have experienced. To transition into the Knowledge Age, however, we should jettison much of this baggage and strive for dramatically increased informational freedom. This is not unprecedented in human history. Prior to the advent of the printing press, stories and music were passed on largely in an oral tradition or through copying by hand. There were no restrictions on who could tell a story or perform a song.
Just to be clear: Information is not the same as knowledge. Information is a broader concept, including, for instance, the huge amounts of log files generated every day by computers around the world, much of which may never be analyzed. We don't know in advance what information will turn out to be the basis for knowledge (i.e., information meant for other humans and which humans choose to maintain over time). Hence it makes sense to keep as much information as possible and make access to that information as broad as possible.
In this section we will explore various ways to expand informational freedom, the second important regulatory step to facilitate our transition to a Knowledge Age.
On occasion, the Internet has come in for derision from those who claim it is only a small innovation compared to, say, electricity or vaccinations. Yet it is not small at all. If you want to learn how electricity or vaccinations work, the Internet suddenly makes that possible for anyone, anywhere in the world. Absent artificial limitations re-imposed on it, the Internet provides the means of access to and distribution of all human knowledge—including all of history, art, music, science, and so on—to all of humanity. As such, the Internet is the crucial enabler of the digital Knowledge Loop and access to the Internet is a central aspect of Informational Freedom.
At present, over 3.5 Billion people are connected to the Internet, and we are connecting over 200 Million more every year . This tremendous growth has become possible because the cost of access has fallen so dramatically. A capable smartphone costs less than $100 to manufacture, and in places with strong competition 4G bandwidth is provided at prices as low as $8 per month (this is a plan in Seoul that provides 500 MB at 4G speeds, a 2GB plan is $17 per month)  .
Even connecting people in remote places is getting much cheaper, as the cost for wireless networking is coming down and we are building more satellite capacity. For instance, there is a project underway that connects rural communities in Mexico for less than $10,000 in equipment cost per community. At the same time in highly developed economies such as the U.S., ongoing technological innovation, such as MIMO wireless technology, will further lower prices for bandwidth in dense urban areas .
All of this is to say that even at relatively low levels, a UBI will cover the cost of access to the Internet, provided that we keep innovating and have highly competitive and/or properly regulated access markets. This is a first example of how the three different freedoms mutually re-enforce each other: Economic Freedom allows people to access the Internet, which is the foundation for Informational Freedom.
As we work to give everyone affordable access to the Internet, we still must address other limitations to the flow of information on the Internet. In particular, we should oppose restrictions on the Internet imposed by either our governments or our ISPs (Internet Service Providers, the companies we use to get access to the Internet). Both of them have been busily imposing artificial restrictions, driven by a range of economic and policy considerations.
By design, the Internet does not include a concept of geographic regions. Most fundamentally, it constitutes a way to connect networks with one another (hence the name “Internet” or network between networks). Any geographic restrictions that exist today have been added in, often at great cost. For instance, Australia and the UK have recently built so-called “firewalls” around their countries that are not unlike the much better-known Chinese firewall. These firewalls are not cheap. It cost the Australian government about $44 million to build its geographic-based, online perimeter . This is extra equipment added to the Internet that places it under government control, restricting Informational Freedom. Furthermore, as of 2017 both China and Russia have moved to block VPN (Virtual Private Network) services, a tool that allowed individuals to circumvent these artificial restrictions and censorship online . As citizens, we should be outraged that our own governments are spending our money to restrict our Informational Freedom. Imagine, as an analogy, if the government in an earlier age had come out to say “we will spend more taxpayer money so that you can call fewer phone numbers in the world.”
The same additional equipment used by governments to re-impose geographic boundaries on the Internet is also used by ISPs to extract additional economic value from customers, in the process distorting access. These practices include paid prioritization and zero rating. To understand them better and why they are a problem, let's take a brief technical detour.
When you buy access to the Internet, you pay for a connection of a certain capacity. Let's say that is 10 Mbps (that is 10 Megabits per second). So if you use that connection fully for, say, sixty seconds, you would have downloaded (or uploaded for that matter) 600 Megabits, the equivalent of 15-25 songs on Spotify or SoundCloud (assuming 3-5 Megabytes per song). The fantastic thing about digital information is that all bits are the same. So it really doesn't matter whether you used this to access Wikipedia, to check out Khan Academy, or to browse images of kittens. Your ISP should have absolutely no say in that. You have paid for the bandwidth, and you should be free to use it to access whatever parts of human knowledge you want.
That principle, however, doesn't maximize profit for the ISP. To do so, the ISP seeks to discriminate between different types of information based on consumer demand and the supplier's ability to pay. Again, this has nothing to do with the underlying cost of delivering those bits. How do ISPs discriminate between different kinds of data? They start by installing equipment that lets them identify bits based on their origin. They then go to a company like YouTube or Netflix and ask them to pay money to the ISP to have their traffic “prioritized,” relative to the traffic from other sources that are not paying. Another form of this manipulation is so-called “zero rating” which is common among wireless providers, where some services pay to be excluded from the monthly bandwidth cap. And if permitted, ISPs will go even a step further: in early 2017 the U.S. Senate voted to allow ISPs to sell customer data including browsing history without prior customer consent .
The regulatory solution to this issue goes by the technical and boring name of Net Neutrality. But what is really at stake here is Informational Freedom. Our access to human knowledge should not be skewed by the financial incentives of our ISPs. Why do we need regulation? Why not just switch to another ISP, one that provides neutral access? As it turns out in most geographic areas, especially in the United States, there is no competitive market for Internet access. ISPs either have outright monopolies (often granted by regulators) or they operate in small oligopolies. For instance, in the part of New York City (Chelsea) where I live at the moment, there is just one broadband ISP, with speeds that barely qualify as real broadband.
Over time technological advances such as wireless broadband and mesh networking may make the Internet Access market more competitive. Until then, however, we need regulation to avoid ISPs limiting our Informational Freedom. This concern is shared by people in diverse geographies. For instance, India recently objected to a plan by Facebook to provide subsidized Internet access which would have given priority to Facebook services [FFB].
Once you have access to the Internet, you need software to connect to its many information sources and services. When Sir Tim Berners-Lee first invented the World Wide Web in 1989 to make information sharing on the Internet easier, he did something very important . He specified an open protocol, the Hypertext Transfer Protocol or HTTP, that anyone could use to make information available and to access such information. By specifying the protocol, Berners-Lee opened the way for anyone to build software, so-called web servers and browsers that would be compatible with this protocol. Many did, including, famously, Marc Andreessen with Netscape. Many of the web servers and browsers were available as open source and/or for free.
The combination of an open protocol and free software meant two things: Permissionless publishing and complete user control. If you wanted to add a page to the web, you didn't have to ask anyone's permission. You could just download a web server (e.g. the open source Apache), run it on a computer connected to the Internet, and add content in the HTML format. Voila, you had a website up and running that anyone from anywhere in the world could visit with a web browser running on his or her computer (at the time there were no smartphones yet). Not surprisingly, content available on the web proliferated rapidly. Want to post a picture of your cat? Upload it to your webserver. Want to write something about the latest progress on your research project? No need to convince an academic publisher of the merits. Just put up a web page.
People accessing the web benefited from their ability to completely control their own web browser. In fact, in the Hypertext Transfer Protocol, the web browser is referred to as a “user agent” that accesses the Web on behalf of the user. Want to see the raw HTML as delivered by the server? Right click on your screen and use “view source.” Want to see only text? Instruct your user agent to turn off all images. Want to fill out a web form but keep a copy of what you are submitting for yourself? Create a script to have your browser save all form submissions locally as well.
Over time, popular platforms on the web have interfered with some of the freedom and autonomy that early users of the web used to enjoy. I went on Facebook the other day to find a witty note I had written some time ago on a friend's wall. It turns out that Facebook makes finding your own wall posts quite difficult. You can't actually search all the wall posts you have written in one go; rather, you have to go friend by friend and scan manually backwards in time. Facebook has all the data, but for whatever reason, they've decided not to make it easily searchable. I'm not suggesting any misconduct on Facebook's part—that's just how they've set it up. The point, though, is that you experience Facebook the way Facebook wants you to experience it. You cannot really program Facebook differently for yourself. If you don't like how Facebook's algorithms prioritize your friends' posts in your newsfeed, then tough luck, there is nothing you can do.
Or is there? Imagine what would happen if everything you did on Facebook was mediated by a software program—a “bot”—that you controlled. You could instruct this bot to go through and automate for you the cumbersome steps that Facebook lays out for finding past wall posts. Even better, if you had been using this bot all along, the bot could have kept your own archive of wall posts in your own data store (e.g., a Dropbox folder); then you could simply instruct the bot to search your own archive. Now imagine we all used bots to interact with Facebook. If we didn't like how our newsfeed was prioritized, we could simply ask our friends to instruct their bots to send us status updates directly so that we can form our own feeds. With Facebook on the web this was entirely possible because of the open protocol, but it is no longer possible in a world of proprietary and closed apps on mobile phones.
Although this Facebook example might sound trivial, bots have profound implications for power in a networked world. Consider on-demand car services provided by companies such as Uber and Lyft. If you are a driver today for these services, you know that each of these services provides a separate app for you to use. And yes you could try to run both apps on one phone or even have two phones. But the closed nature of these apps means you cannot use the compute power of your phone to evaluate competing offers from the networks and optimize on your behalf. What would happen, though, if you had access to bots that could interact on your behalf with these networks? That would allow you to simultaneously participate in all of these marketplaces, and to automatically play one off against the other.
Using a bot, you could set your own criteria for which rides you want to accept. Those criteria could include whether a commission charged by a given network is below a certain threshold. The bot, then, would allow you to accept rides that maximize the net fare you receive. Ride sharing companies would no longer be able to charge excessive commissions, since new networks could easily arise to undercut those commissions. For instance, a network could arise that is cooperatively owned by drivers and that charges just enough commission to cover its costs. Likewise, as a passenger using a bot could allow you to simultaneously evaluate the prices between different car services and choose the service with the lowest price for your current trip. The mere possibility that a network like this could exist would substantially reduce the power of the existing networks.
We could also use bots as an alternative to anti-trust regulation to counter the overwhelming power of technology giants like Google or Facebook without foregoing the benefits of their large networks. These companies derive much of their revenue from advertising, and on mobile devices, consumers currently have no way of blocking the ads. But what if they did? What if users could change mobile apps to add Ad-Blocking functionality just as they can with web browsers?
Many people decry ad-blocking as an attack on journalism that dooms the independent web, but that's an overly pessimistic view. In the early days, the web was full of ad-free content published by individuals. In fact, individuals first populated the web with content long before institutions joined in. When they did, they brought with them their offline business models, including paid subscriptions and of course advertising. Along with the emergence of platforms such as Facebook and Twitter with strong network effects, this resulted in a centralization of the web. More and more content was produced either on a platform or moved behind a paywall.
Ad-blocking is an assertion of power by the end-user, and that is a good thing in all respects. Just as a judge recently found that taxi companies have no special right to see their business model protected, neither do ad-supported publishers . And while in the short term this might prompt publishers to flee to apps, in the long run it will mean more growth for content that is paid for by end-users, for instance through a subscription, or even crowdfunded (possibly through a service such as Patreon).
To curtail the centralizing power of network effects more generally, we should shift power to the end-users by allowing them to have user agents for mobile apps, too. The reason users don't wield the same power on mobile is that native apps relegate end-users once again to interacting with services just using our eyes, ears, brain and fingers. No code can execute on our behalf, while the centralized providers use hundreds of thousands of servers and millions of lines of code. Like a web browser, a mobile user-agent could do things such as strip ads, keep copies of my responses to services, let me participate simultaneously in multiple services (and bridge those services for me), and so on. The way to help end-users is not to have government smash big tech companies, but rather for government to empower individuals to have code that executes on their behalf.
What would it take to make bots a reality? One approach would be to require companies like Uber, Google, and Facebook to expose all of their functionality, not just through standard human usable interfaces such as apps and web sites, but also through so-called Application Programming Interfaces (APIs). An API is for a bot what an app is for a human. The bot can use it to carry out operations, such as posting a status update on a user's behalf. In fact, companies such as Facebook and Twitter have APIs, but they tend to have limited capabilities. Also, companies presently have the right to control access so that they can shut down bots, even when a user has clearly authorized a bot to act on his or her behalf.
Why can't I simply write code today that interfaces on my behalf with say Facebook? After all, Facebook's own app uses an API to talk to their servers. Well in order to do so I would have to “hack” the existing Facebook app to figure out what the API calls are and also how to authenticate myself to those calls. Unfortunately, there are three separate laws on the books that make those necessary steps illegal.
The first is the anti-circumvention provision of the DMCA. The second is the Computer Fraud and Abuse Act (CFAA). The third is the legal construction that by clicking “I accept” on a EULA (End User License Agreement) or a set of Terms of Service I am actually legally bound. The last one is a civil matter, but criminal convictions under the first two carry mandatory prison sentences.
So if we were willing to remove all three of these legal obstacles, then hacking an app to give you programmatic access to systems would be possible. Now people might object to that saying those provisions were created in the first place to solve important problems. That's not entirely clear though. The anti circumvention provision of the DMCA was created specifically to allow the creation of DRM systems for copyright enforcement. So what you think of this depends on what you believe about the extent of copyright (a subject we will look at in the next section).
The CFAA too could be tightened up substantially without limiting its potential for prosecuting real fraud and abuse. The same goes for what kind of restriction on usage a company should be able to impose via a EULA or a TOS. In each case if I only take actions that are also available inside the company's app but just happen to take these actions programmatically (as opposed to manually) why should that constitute a violation?
But, don't companies need to protect their encryption keys? Aren't “bot nets” the culprits behind all those so-called DDOS (distributed denial of service) attacks? Yes, there are a lot of compromised machines in the world, including set top boxes and home routers that some are using for nefarious purposes. Yet that only demonstrates how ineffective the existing laws are at stopping illegal bots. Because those laws don't work, companies have already developed the technological infrastructure to deal with the traffic from bots.
How would we prevent people from adopting bots that turn out to be malicious code? Open source seems like the best answer here. Many people could inspect a piece of code to make sure it does what it claims. But that's not the only answer. Once people can legally be represented by bots, many markets currently dominated by large companies will face competition from smaller startups.
Legalizing representation by a bot would eat into the revenues of large companies, and we might worry that they would respond by slowing their investment in infrastructure. I highly doubt this would happen. Uber, for instance, was recently valued at $50 billion. The company's “takerate” (the percentage of the total amount paid for rides that they keep) is 20%. If competition forced that rate down to 5%, Uber's value would fall to $10 billion as a first approximation. That is still a huge number, leaving Uber with ample room to grow. As even this bit of cursory math suggests, capital would still be available for investment, and those investments would still be made.
That's not to say that no limitations should exist on bots. A bot representing me should have access to any functionality that I can access through a company's website or apps. It shouldn't be able to do something that I can't do, such as pretend to be another user or gain access to private posts by others. Companies can use technology to enforce such access limits for bots; there is no need to rely on regulation.
Even if I have convinced you of the merits of bots, you might still wonder how we might ever get there from here. The answer is that we can start very small. We could run an experiment with the right to be represented by a bot in a city like New York. New York's municipal authorities control how on demand transportation services operate. The city could say, “If you want to operate here, you have to let drivers interact with your service programmatically.” And I'm pretty sure, given how big a market New York City is, these services would agree.
Once we have fought back geographical and prioritization limits and have bots in place that represent us online, we still come up against legal limits that severely restrict what we can create and share. We'll first look at copyright and patent laws and suggest policies and approaches for reducing how much these limit the Knowledge Loop. In the section after that we'll turn to privacy laws.
Earlier I remarked how expensive it was to make a copy of a book when human beings literally had to copy it one letter at a time. Eventually we invented the printing press, and after that movable type. Together the two provided for much faster and cheaper reproduction of information. Even back then, governments and churches saw this as a threat to their authority. In England, the Licensing of the Press Act of 1662 established a legal response: if you wanted to operate a printing press, you first needed the government's approval . You received it in exchange for agreeing to censor content critical of the government or that ran counter to church teachings. And that's the origin of copyright. It started as the right to make copies in return for agreeing to censorship.
Over time, as economies grew and publishing companies emerged as business enterprises, copyright became commercially meaningful, less as an instrument of government control and more as a source of profit. The logic runs like this: “If I have the copyright to a specific material, then you cannot make copies of it, which means that I essentially have a monopoly in providing this content. I am the only one allowed to produce and sell copies of it.”
Legitimating this transformation of copyright was the idea that in order for enough content to be produced in the first place, incentives needed to exist for the creators of content. An analogy was drawn with investment in physical infrastructure. If you own the output of a factory, then you will invest in capacity because you get to keep the benefits from increased production. Similarly, the thinking goes, if you are working on a book, you should own the book, so that you have an incentive to write it in the first place and improve it over time through revisions.
Over time the holders of copyrights have worked to strengthen their claims and extend their reach. For instance, with the passing of The Copyright Act of 1976, the requirement to register a copyright was removed. Instead, if you created content you automatically had copyright in it . Then in 1998 with passage of the Copyright Term Extension Act, the years for which you had a copyright were extended from 50 to 70 years beyond the life of the author. This became known as the “Mickey Mouse Protection Act,” because Disney had lobbied the hardest for it, having built a large and profitable business based on protected content, and mindful that a number of its copyrights were slated to expire .
More recently, copyright lobbying has attempted to interfere with the publication of content on the Internet through proposed legislation such as PIPA and SOPA, and language in the Transpacific Partnership (TPP, a trade deal that ultimately the United States did not join). In these latest expansion attempts, the conflict between copyright and the Digital Knowledge Loop becomes especially clear. Copyright severely limits what you can do with content, essentially restricting you to consuming the content. It dramatically curtails your ability to share it and create other works that use some or all of the content. Some of the more extreme examples include takedowns of videos from YouTube that used the Happy Birthday song, which, yes, was copyrighted until recently.
From a societal standpoint, given digital technology, it is never optimal to prevent someone from listening to a song or watching a baseball game once the content exists. Since the marginal cost of accessing a digital copy is zero, the world is better off if that person gets just a little bit of enjoyment from that content. And if that person turns out to be inspired and write an amazing poem that millions read, well then the world is a lot better off.
Now, you might say, it's all well and good that the marginal cost for making a copy is zero, but what about all the fixed and variable cost that goes into making content? If all content were to be free, then where would the money come from for producing any of it? Don't we need copyright to give people the incentive to produce content in the first place?
Some degree of copyright is probably needed, especially for large-scale projects such as movies. Society may have an interest in seeing $100 million blockbuster films or series being made, and it is likely that nobody will make them if, in the absence of copyright protection, they aren't economically viable. Yet even here the protections should have constraints on enforcement (for instance, you shouldn't be able to take down an entire site or service just because it happens to host a link to a pirated stream of your movie, as long as the link is promptly removed). More generally, I believe copyright can be dramatically reduced in its scope and made much more costly to obtain and maintain. The only automatic right accruing to content should be one of attribution. The reservation of additional rights should require a registration fee, because you are asking for content to be removed from the Digital Knowledge Loop.
Let's take music as an example. Musical instruments were made as far back as 30,000 years ago, pre-dating any kind of copyright by many millennia. Even the earliest known musical notation, which marks music's transition from information to knowledge (again, defined as something that can be maintained and passed on by humans over time and distance), is around 3,400 years old . Clearly people made music, composed it, shared it long before copyright existed. In fact, the period during which someone could make a significant amount of money making and then selling recorded music is extraordinarily short, starting with the invention of the gramophone in the 1870s and reaching its heyday in 1999, the year that saw the biggest profits in the music industry .
During the thousands of years before this short period, musicians made a living either from live performances or through patronage. If copyrighted music ceased to exist tomorrow, people would still compose, perform, and record music. And musicians would make money from live performances and patronage, just as they did prior to the rise of copyright. Indeed, as Steven Johnson found when he recently examined this issue, that's already what is happening to some degree: “the decline in recorded—music revenue has been accompanied by an increase in revenues from live music... Recorded music, then, becomes a kind of marketing expense for the main event of live shows” . Many musicians have voluntarily chosen to give away digital versions of their music. They release tracks for free on Soundcloud or YouTube and raise money to make music from performing live and/or using crowdfunding methods such as Kickstarter and Patreon.
Now imagine a situation where the only automatic right accruing to an intellectual work was one of attribution. Anyone wanting to copy or distribute your song in whole or in part has to credit you. Such attribution can happen digitally at zero marginal cost and does not inhibit any part of the Knowledge Loop. Attribution imposes no restrictions on learning (making, accessing, distributing copies), on creating derivative works, and on sharing those. Attribution can include reference to who wrote the lyrics, who composed the music, who played which instrument and so on. Attribution can also include where you found this particular piece of music (i.e., giving credit to people who discover music or curate playlists). This practice is already becoming more popular using tools such as the Creative Commons License, or the MIT License often used for attribution in open source software development.
Now, what if you're Taylor Swift and you don't want others to be able to use your music without paying you? Well, then you are asking for your music to be removed from the Knowledge Loop, thus reducing the benefits that loop confers upon society. Therefore you should be paying for that right, which not only represents a loss to society, but will also be costly to enforce. I don't know how big the registration fee should be — that's something that will require further work — but it should be a monthly or annual fee, and when you stop paying it, your work should revert back to possessing attribution-only rights.
Importantly, in order to reserve rights, you should have to register your music with a registry, and some part of the copyright fee would go towards maintenance of these registries. Thanks to blockchain technology, competing registries can exist that all use the same global database. The registries themselves would be free for anyone to search, and registration would involve a prior search to ensure that you are not trying to register someone else's work. The search could and should be built in a way so that anyone operating a music sharing service, such as Spotify or Soundcloud, can trivially implement compliance to make sure they are not freely sharing music that has reserved rights.
It would even be possible to make the registration fee dependent on how many rights you want to retain. All of this could be modeled after the Creative Commons licenses. For instance, your registration fee might be lower if you allow non-commercial use of your music and also allow others to create derivative works. The fee might increase significantly if you want all your rights reserved. The same or similar systems could be used for all content types, including text, images and video.
Critics might object that the registration I'm proposing imposes a financial burden on creators. It is important to remember the converse: Removing content from the Knowledge Loop imposes a cost on society. And enforcing this removal, for instance by finding people who are infringing and penalizing them, incurs additional costs for society. For these reasons, asking creators to pay is fair, especially if creators' economic freedom is already assured by a Universal Basic Income (UBI).
UBI also provides a counter to another argument frequently wielded in support of excessive copyright: Employment at publishers. The major music labels combined currently employ roughly 17,000 people   . When people propose limiting the extent of copyright, others point to the potential loss of these jobs. Never mind that the existence of this employment to some degree reflects the cost to society from having copyright. Owners, managers and employees of music labels are, for the most part, not the creators of the music.
Before turning to patents, let me point out one more reason why a return to a system of paid registration of rights makes sense. None of us creates intellectual works in a vacuum. Any author who writes a book has read lots of writing by other people. Any musician has listened to tons of music. Any filmmaker has watched countless movies. Much of what makes art so enjoyable these days is the vast body of prior art that it draws upon and can explicitly or implicitly reference. There is no “great creator” who brings forth their work ex nihilo. We are all part of the Knowledge Loop that has already existed for millennia.
While copyright limits our ability to share knowledge, patents limit our ability to use knowledge to create something. Much like having a copyright confers a monopoly on reproduction, a patent confers a monopoly on use. And the rationale for the existence of patents is similar to the argument for copyright. The monopoly that is granted results in economic rents (i.e., profits) that are supposed to provide an incentive for people to invest in research and development.
As with copyright, the incentive argument here should be suspect. People invented long before patents existed and some people have continued to invent without seeking patents. We can trace early uses of patents to Venice in the mid 1400s; Britain had a fairly well established system by the 1600s . That leaves thousands of years of invention, a time that saw such critical breakthroughs as the alphabet, movable type, the wheel, and gears. This is to say nothing of those inventors who more recently chose not to patent their inventions because they saw how that would interrupt the knowledge loop and impose a loss on society. These inventors include Jonas Salk, who created the Polio vaccine (others include x rays, penicillin, ether as an anesthetic, and many more, see ). Since we know that limits on knowledge use impose a cost, we should therefore ask what alternatives exist to patents to stimulate innovation.
Many people are motivated simply by wanting to solve a problem. This could be a problem they are having themselves or something that impacts family or friends or the world at large. With a Universal Basic Income more of these people will be able to spend their time on inventing following intrinsic motivation.
We will also see more invention because digital technologies are reducing the cost of inventing. One example of this is the USV portfolio company Science Exchange, which has created a market place for laboratory experiments. Let's say you have an idea that requires you to sequence a bunch of genes. The fastest gene sequencing available to date comes from a company called Illumina, whose machines costs from $850K-$1M to buy . Via Science Exchange, however, you can access such a machine on a per use basis for less than $1000 . Furthermore, the next generation of sequencing machines is already on the way, and these machines will further reduce the cost. Here too we see the phenomenon of technological deflation at work.
A lot of recent legislation has needlessly inflated the cost of innovation. In particular, rules around drug testing have made drug discovery prohibitively expensive. We have gone too far in the direction of protecting patients during the research process and also of allowing for large medical damage claims. As a result, many drugs are either not developed at all or are withdrawn from the market despite their efficacy (for example the vaccine against Lyme disease, which is no longer available for humans  ).
Patents (i.e., granting a temporary monopoly) are not the only way to provide incentives for innovation. Another historically successful strategy has been the offering of public prizes. Britain famously offered the Longitude rewards starting in 1714 to induce solutions to the problem of determining a ship's longitude at sea (latitude can be determined easily from the position of the sun). Several people were awarded prizes for their designs of chronometers, lunar distance tables and other methods for determining longitude (including improvements to existing methods). As quid pro quo for receiving the prize money, inventors generally had to make their innovations available to others to use as well .
At a time when we wish to accelerate the Knowledge Loop, we must shift the balance towards knowledge that can be used freely and that is not encumbered by patents. It is promising to see successful recent prize programs, such as the X Prizes, DARPA Grand Challenges, and NIST competitions. There is also potential for crowdfunding future prizes. Medical research in particular should be a target for prizes to help bring down the cost of healthcare.
Going forward, we can achieve this by using prizes more frequently. And yet, that leaves a lot of existing patents in place. Here I believe a lot can be done to reform the existing system and make it more functional, in particular by reducing the impact of so-called Non Practicing Entities (NPEs, commonly referred to as “patent trolls”). These are companies that have no operating business of their own, and exist solely for the purpose of litigating patents.
In recent years, many NPEs have been litigating patents of dubious validity. They tend to sue not just a company but also that company's customers. This forces a lot of companies into a quick settlement. The NPE then turns around and uses the early settlement money to finance further lawsuits. Just a few dollars for them go a long way because their attorneys do much of the legal work on a contingency basis, expecting further settlements. Fortunately, a recent Supreme Court ruling placed limits on where patent lawsuits can be filed, which should help limit the activity of these NPEs going forward .
As a central step in patent reform, we thus must make it easier and faster to invalidate existing patents while at the same time making it more difficult to obtain new patents. Thankfully, we have seen some progress on both counts in the U.S., but we still have a long way to go. Large parts of what is currently patentable should be excluded from patentability in the first place, including designs and utility patents. University research that has received even small amounts of public funding should not be eligible for patents at all. Universities have frequently delayed the publication of research in areas where they have hoped for patents that they could subsequently license out. This practice has constituted one of the worst consequences of the patent system for the Knowledge Loop.
We have also gone astray by starting to celebrate patents as a measure of technological progress and prowess instead of treating them as a necessary evil (and maybe not even necessary). Ideally, we would succeed in rolling back the reach of existing patents and raising the bar for new patents while also inducing as much unencumbered innovation as possible through the bestowing of prizes and social recognition.
Copyrights and patents aren't the only legal limitations slowing down the Digital Knowledge Loop. We are actively creating new restrictions in the form of well-intentioned privacy regulations. Not only do these measures wind up restricting Informational Freedom but more fundamentally privacy is incompatible with technological progress. Instead of clinging to our current conception of privacy we therefore need to understand how to be free in a world of widespread information sharing. Put differently: privacy is not a value in and of itself, rather it has been a strategy for achieving and protecting freedom. To get over privacy and stay free we need to expand Economic Freedom, Informational Freedom and Psychological Freedom.
Before getting into the arguments to support this position, let me first note that countries and individuals already today are taking dramatically different approaches to the privacy of certain types of information. For example, Sweden and Finland have for many years been publishing everyone's tax return . And some individuals, including the CIO and Dean for Technology at Harvard Medical School , have published their entire medical history on the Internet. This shows that a world which embraces strategies other than privacy to safeguard individual freedom is eminently possible and exists in parts already today.
To better understand this perspective, consider the costs and benefits to individuals and to society from keeping information private with the costs and benefits of sharing it widely (potentially publicly). Digital technology is dramatically shifting this cost/benefit trade-off in favor of sharing. Take a radiology image as an example. Analog x-ray technology produced images on a physical film that had to be developed could then be examined by someone holding it up against a backlight. If you wanted to protect the information on it, you would put it in a file and lock up that file in a drawer. If you wanted a second opinion, you would have to get that file out of the drawer and have it sent it to you or the other doctor by mail. That process was costly, time consuming and error prone (the film could be lost in the mail, or the wrong film could be sent, etc.). The upside of analog x-rays was the ease of keeping the information secret; the downside was the difficulty of putting the information to use for your benefit.
Now compare analog x-rays to digital x-ray images. You can instantly walk out of your doctor's office with a copy of the digital image on a thumb drive or have it emailed to you or put in a Dropbox or shared via some other way made possible by the Internet. Thanks to this technology, you can now get a second opinion nearly instantly. Not only one, you could get two or three. And if everyone you contacted directly is stumped, you could post the image on the Internet for everyone to see. Some doctor somewhere in the world may go, “ah, I have seen that before” even if “that” is incredibly rare. This in fact has happened repeatedly on Figure 1, a USV portfolio company, which provides an image sharing network for medical professionals.
This power comes at a price: Protecting your digital x-ray image from others who might wish to see it is virtually impossible. Every doctor who looks at your image could make a copy (for free, instantly and with perfect fidelity) and then send that to someone else. The same goes for others who might have access to the image, such as your insurance company.
Now, critics will make all sorts of claims about how we can prevent unauthorized use of your image using encryption. But as we will see, those claims come with important caveats and are dangerous if pursued to their ultimate conclusion (preview: you cannot have general purpose computing). So in summary: The upside of a digital x-ray image is how easy it makes it to get help; the downside is how hard it is to protect digital information.
But the analysis hardly ends there. The benefits that accrue to your digital x-ray image go well beyond just you. Imagine a huge collection of digital x-ray images all labeled with diagnoses. We can use computers to search through those images and get machines to “learn” what to look for. We know that such systems can be built given the recent progress with deep learning. And these systems, because of the magic of zero marginal cost, can assist with and eventually provide future diagnoses for free. This, you may recall from the section on technological deflation in healthcare, is exactly what we want. How rapidly we make progress with that and who controls the results will depend heavily on who has access to digital x-ray images.
If we went to the extreme and made all healthcare information public, we would dramatically accelerate innovation in diagnosing and treating diseases. At present, only large pharma companies and a few university research projects can develop new medical insights and drugs, since only they have the money required to get many patients to participate in research. Many scientists are forced to join a big pharma company, leaving the results of their work protected by patents (pharma companies have repeatedly lobbied for the ability to keep such information strictly for themselves). Even at universities, the research agenda tends to be tightly controlled by department heads and access to information is seen as a competitive advantage. While I understand that we have a lot of work to do to create a world in which broad public sharing of health information is compatible with freedom, this is the direction we should be embarking on.
So why do I keep asserting the impossibility of assuring privacy? Don't we have encryption? Encryption is great for securing information in transit and at rest, but there are problems that encryption doesn't and can't solve.
The first problem is that encryption keys are also just digital information themselves, so keeping them secure confronts us with just another instance of the original problem. Transmitting your keys leaves them vulnerable to interception. Even generating a key on your own machine offers limited protection, unless you are willing to have that be the only key with the risk that any data you're protecting will be lost forever if you lose the device. As a result, most systems include some kind of cloud based backup and a way of retrieving a key, making it possible that someone will access your data either through technical interception or social engineering (tricking a human being to unwittingly participate in a security breach). If you want some sense of how hard this problem is consider the millions of dollars in crypto currency that have been lost both by people who lost their key and also people who had their keys taken over through some form attack. And the few crypto currency companies and exchanges that have a decent track record have invested huge sums in security procedures, screening of personnel and secrecy.
The second problem is so-called “endpoint security.” Consider, for example, the computer of the doctor to whom you are sending your x-ray for a second opinion. That machine may have a program running on it that can access anything that is displayed on the screen. In order to view your x-ray, the doctor of course has to decrypt it and display it, so this screen capture program will have access to the unencrypted image. Avoiding such a scenario would require us to lock down all computing devices. But that means preventing end-users from installing software on them and running all software through a rigorous centralized inspection process. Even a locked down endpoint is still subject to the so-called “analog hole,” in which someone simply takes a picture of what is displayed on a screen. That picture today can of course be taken with a digital camera and instantly shared again.
Locked down computing devices reduce Informational Freedom and constrict innovation; they also pose a huge threat to democracy and the Knowledge Loop. Someone else would control what you can compute, who you can exchange information with, and so on, in what would essentially become a dictatorial system. Already today we are headed in this direction in mobile computation, in no small part due to the assertion of a need to protect privacy. Apple uses this argument as to why the only way to install apps on an iPhone should be through the Apple app store. Now imagine this type of regime extended to all computing devices, including your laptop and servers in the cloud. So here we have the first way in which privacy is incompatible with technological progress. We can either have really strong privacy assurance or we can have open general purpose computing but not both.
Many people contend that there must be some way to preserve privacy and keep innovating. I challenge anyone to create a coherent vision of the future where individuals, not governments or large corporations (such as Apple) control technology and where privacy is meaningfully protected. Any time you leave your house, you are probably being filmed by someone's camera. Every smartphone has a camera these days, and in the future we'll see tiny cameras on tiny drones. Your gait identifies you almost as uniquely as your fingerprint. Your face is probably somewhere on the Internet and your car's license plate is readable by any camera. You leave your DNA almost everywhere you go, and soon individuals will be able to sequence DNA at home for about 100 dollars. Should the government control all of these technologies? Should it level draconian punishments for using these technologies to analyze someone else's presence or movement? And if so how would those penalties be enforced?
But there is an even deeper and more profound reason why privacy is incompatible with technological progress. Entropy is the enemy of life and it is a fundamental property of the universe. There are many more arrangements of atoms that make absolutely nothing, than there are arrangements that make a house or for that matter a human being. That means that it is always easier to destroy than it is to create. Anyone who has spent hours building a sand castle on the beach only to see it destroyed by a single wave as the tide comes in has a visceral sense of this asymmetry. What does this have to do with privacy you may ask? As we make technological progress our ability to destroy grows much faster than our ability to create. It still takes 20 years to grow an adult human being. Modern weapons can kill hundreds, thousands, sadly even millions of humans in an instant. So as we make technological progress we must insist on less privacy to protect society. Imagine for a moment a future in which I can create a potent biological weapon in my basement laboratory (a future that is not far off). Ex post police enforcement is meaningless in such a world.
So we can't really protect privacy without handing control of technology into the hands of a few and conversely decentralized innovation requires reduced privacy. What should we do? The answer, I think, is to embrace a post-privacy world. We should work to protect people and their freedom, instead of protecting data and privacy. We should allow more information to become public, while strengthening individual freedom to stand against the potential consequences. Such an embrace can and will happen gradually. Much information is already no longer private through hacks and data breaches that abruptly expose data on millions of people . And many individuals are voluntarily disclosing previously private information about themselves on blogs and social media. Economic freedom via a Universal Basic Income (UBI) will play a key role here. Much of the fear about private information being revealed results from potential economic consequences. For instance, if you are worried that you might lose your job and not be able to pay your rent if your employer finds out that you wrote a blog post about struggling with depression, you are much less likely to do so.
If you think that a post privacy world is impossible or terrifying, it is worth remembering that privacy is really a modern and urban construct. Even the United States Constitution, while protecting certain specific rights, does not recognize a generalized right to privacy (the word privacy does not appear at all). For thousands of years prior to the 18th century, most people had no concept of privacy. Many of the functions of everyday life, including excretion and reproduction, took place much more openly than they do today. And privacy still varies greatly among cultures—many Westerns are shocked when they first experience the openness of Chinese public restrooms  (although these appear to be disappearing). All over the world, people in small villages live with much less privacy than is common in big cities. You could regard the lack of privacy as oppressive, or you could see a close-knit community as a real benefit and source of strength. For instance, I remember growing up in a small village in Germany where if a member of our community was sick and couldn't leave the house, a neighbor would quickly check up on them and offer to do the shopping or provide food.
You might ask, what about my bank account? If my account number was public, wouldn't it be much easier for bad actors take my money? Yes, which is why we need to construct systems that don't just require a number that you have already shared with others to authorize payments. Apple Pay and Android Pay are such systems. Every transaction requires an additional form of authentication at the time of transaction. Two factor authentication systems will become much more common in the future for any action that you will take in the digital world. In addition, we will rely more and more on systems such as Sift, another USV portfolio company, that assess in real time the likelihood that a particular transaction is fraudulent, taking into account hundreds of different factors. Finally, much of blockchain technology is built on the idea that addresses can be public because they are protected by private keys, making it possible even for transactions to be part of a public ledger.
Another area where people are especially nervous about privacy is health information. We worry, for instance, about employers, insurers, or others in society discriminating against us because they've learned that we have a certain disease or condition. Here the economic freedom conferred by a Universal Basic Income would protect you from going destitute because of discrimination, and by tightening the labor market, it would also make it harder for employers to decide to systematically refuse to hire certain groups of people. Further, we could enact laws that require sufficient transparency on the part of organizations, so that we could better track how decisions have been made and detect more easily if it appears that discrimination is taking place.
Observers such as 4Chan founder Chris Poole have worried that in the absence of privacy, individuals wouldn't be able to engage as fully and as freely online as they do today. Privacy, they think, helps people feel comfortable taking on multiple identities online that may depart dramatically from one another and from their “real life” selves. But I hold a different view. By keeping our various online selves separate, we allow for a lot of inner conflict to persist. We pay a price for this in the form of anxieties, neuroses, and other psychological ailments. It's far better to be fully transparent about the many sides of our personality than to cloister ourselves behind veils of privacy. Emotional and psychological health derives not from a splintering or fragmentation of the self, but the integration of different aspects into a unitary but multi-dimensional personality. [Look for psychological research backing this point]
Many who argue against embracing a post privacy approach, point out that oppressive governments can use information against citizens. People give examples such as the Nazis prosecuting homosexuals or the Chinese government prosecuting dissidents. Without a doubt preserving democracy and the rule of law are essential if we want to achieve a high degree of informational freedom. But the analysis cannot simply hold the level of privacy constant and switch out the regime. One also needs to consider how likely a regime change is for given levels of privacy. And there I am convinced that more public information makes dictatorial takeovers considerably harder. For instance, with public tax records it is much clearer who is benefiting from political change. Conversely, history has taught us that it is entirely possible to build a totalitarian surveillance state with minimal technology by having citizens spy on each other.