[rp-ml] Z-corp, "open-sourcing" & "crowd-sourcing"

From: G. Sachs <sachsg_at_sbcglobal.net>
Date: Wed Nov 23 2011 - 20:35:36 EET

Some good points, Markus and Adrian (especially about some of the screwed-up
things that go on in the U.S.!).

While this is starting to get pretty far afield from the original, Z-corp,
acquisition story, this discussion does bring up some other interesting
questions about current economic trends and future employment possibilities and
risks (with one of the less optimistic of those being that, most of us, may just
end up working for little or nothing, in the future!). For example one of my
biggest concerns with regards to both "open-sourcing" and its close cousin,
"crowd-sourcing", is when these free offerings get co-oped by large commercial
interests, which can then go on to acquire patents on things they didn't even
invent and then completely control them. If and when this happens, it clearly
defeats the purpose of the original, non-commercially, motivated work.

For instance, during last year's Gulf oil disaster, there was a worldwide call
for ideas to help stop the disaster and clean it up. Literally hundreds of
thousands of ideas were generated and sent in to BP (at the request of the Obama
administration). In the end, BP and the Obama administration claimed that not
even a single useful, or practical, idea was generated from all this effort. In
following up on this truly, record breaking, crowd-sourcing "experiment", I
discovered that most of the participants never got any feedback from BP; no one
in the government wanted to directly deal with any of the incoming ideas (that's
why they were all referred to BP) which lead to and allowed BP to stockpile them
into a huge proprietary database (repository) that only BP now has access to.
This database has never been made public even though everything in it was
contributed by the public and more troublesome, it is now not available to
journalists and outside independent scientists to evaluate. To make matters
worse, BP now has the right to patent anything derived from that database that
the original proposers may not have thought to try and patent at the time of
submission - i.e. those who so enthusiastically participated in this
crowd-sourcing "exercise" ( homework), have now allowed for their commercially
exploitation. Another example of this can be found in the protein folding
websites and "games", that encourage people to help figure out how certain (very
important) proteins are spatially configured. At first I thought this was a
great idea and it sounded like both fun and "helpful to society", but then I
realized that many of these solutions will go on to help large pharmaceutical
companies developing new drugs (and make lots of money), without the "solvers"
being compensated at all.

There are also a few web sites devoted exclusively to providing clients with
crowd-sourced solutions to very tough problems, in exchange for either just some
"recognition", or in exchange for a, rather small, fixed-price reward - provided
they are successful in finding a solution. Of coarse, if they are not completely
successful (according to the paying client), then they get absolutely no
compensation for their efforts. In addition to this, rather suspect, "reward
model", the question of what happens to the runner-up ideas (which also may
still be quite good) is never made clear - but I suspect the client gets to
keep and use any of those as well, even though they have to pay nothing for

When I questioned one of the founders of one of these crowd-sourcing sites about
the equity of such business models, he told me that the non-financial rewards to
the participants was, perhaps, just as valuable as the, possible, financial
rewards (i.e. I guess the prestige of being named a "solver" might be worth just
as much as any actual monetary compensation) - to which I responded that
"prestige" was all, well and good, but I'd, still, much prefer "the cash". I
also made it clear that I didn't much care for their business model and indented
to expose it for what it really was.

G. Sachs

P.S. When it comes to the issue of IP rights, at least in the U.S., it all gets
very complicated, very fast. There are no clear and simple answers as to what
can and cannot happen and unfortunately there are considerations and
"strategies" that go beyond just the law. When it comes right down to it, IP (in
the U.S. at least) is really just a an example of game theory applied to the
world of ideas.

From: Markus Hitter <mah@jump-ing.de>
To: Jeremy Pullin <Jeremy.Pullin@Renishaw.com>
Cc: "rp-ml@rapid.lpt.fi list" <rp-ml@rapid.lpt.fi>
Sent: Wed, November 23, 2011 8:34:57 AM
Subject: Re: [rp-ml] Zcorp!?

Am 22.11.2011 um 15:22 schrieb Jeremy Pullin:

> Just think how much computer hardware and ancillaries have been sold to
> linux users over the years. Giving things away free does not nor will it
> ever remove or even reduce the necessity for money and financial
> exchanges.

This is true and there are a few additional points:

- If you buy a consumer PC, you get a closed source operating system for free,
preinstalled. Well, perhaps not for free, but you can't avoid it anyways. So,
the cost of proprietary stuff in the PC world is very low and undoubtly a
noticeable number of PC users use the preinstalled OS just out of laziness.

- In the computer server market, where people take a lot more care what variant
of software they're running, open source OSs are on par or even dominant over
proprietary counterparts.

- Sheer price. Windows server costs a 3 digit number, a Rapid Prototyping
machine costs a 5 digit number. The more digits, the more people think.

- An important difference between open source software and open source hardware:
with hardware, you can make quite some money by just manufacturing copies.
Material price for the plastics parts of a RepRap is about EUR 5.-, still the
price of such printed sets currently settles somewhere at EUR 65.- to EUR 80.-.
No such thing with software, nobody would pay you a single Euro for just
downloading a Linux kernel or Ubuntu OS*.

This later point leads to quite a number of people doing financially healthy
business by just making copies - not just Adrian with his 5 friends. It also
leads to many people designing something new in the prospect of selling the
result. It also leads to some RepRappers saying: developers do the work, copy
shops collect the money.

To keep the topic: open source hardware is very obviously a working innovation
model, not just a freetime hobby for altruists. Think of your engineering
textbooks being full of downloadble designs and you concentrate yourself on just
the new part. That's close to what happens in the open source hardware

Markus Hitter
aka "Traumflug" on RepRap

* When downloading legal music, you don't pay the download either, but a licence
fee for "owning" the music.

- - - - - - - - - - - - - - - - - - -
Dipl. Ing. (FH) Markus Hitter
Received on Wed Nov 23 20:45:30 2011

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