Certainly, I agree that it isn't. Humans didn't evolve with 'information' in the sense that we're using it now. What information we did have (e.g. where the enemy is, how to cut stone and build bridges) was guarded either by force or by complexity of replication. In the modern world, we've created the Intellectual Property construct in an effort to apply what we think of as 'natural' rules to intangible things.

I'd argue that if you can't copy and reuse information, it's even more worthless than a piece of garbage.

I have to disagree with that, or maybe I'm not getting your point. Take the example of the games I have for my XBox 360. I cannot duplicate them (or will not expend the effort required, which is ultimately the same), yet they have provided me with far more entertainment than any piece of garbage I've ever come across. ;-)

You don't own information. It just happens to be passing through your head on its way to someone else's (if it's worth anything - if it stops at you, it's worthless).

That's an interesting concept, but I create information. The application I'm writing right now would not ever exist without me. Others may be in the same market, doing similar things, but the fact is still that I am creating a unique, intangible object out of nothing. So, it's not merely passing through my head, but rather, it's originating in my head.

By the way, I agree with the parenthetical end of that sentence. If I don't distribute my software, it's never of any use to anyone (other than me). But I don't think that says anything about the difference between controlled release in exchange for money versus free replication.

I don't think you should be downvoted for your opinion

I appreciate that, and have enjoyed this discussion.

The point is that information per se is non-rival and non-scarce, so the normal drivers of market exchange don't apply to it. Since we want to incentivize the creation of information, we have created positive law that generates artificial scarcity, and allows market forces to work mostly as they would for physical goods, but this is just a stopgap solution due to the difficulty of commoditizing the downstream uses of information.

To echo another commenter in this thread, if we were better at commoditizing and marketing the uses of information directly, rather than the information itself, we wouldn't need to use artificial scarcity as a proxy to generate that incentive.

> all these things require effort to produce, maintain, curate, distribute.

But these inputs are not the determinant of the value of the end product. They only describe the process of creating it, but value is determined by the subjective utility enjoyed by the end consumer.

If you view time and effort necessary to create and distribute information as a capital expenditure on par with the time and effort necessary to design and manufacture any physical good, perhaps things come into clearer relief. Is anyone entitled to a guaranteed return on capital investments, or are they bearing risk in making them in pursuit of a potential, but uncertain, return? I think most people would hold the latter view.

> Leaving the practical constraints behind, I also struggle to see moral or ethical reasons for information to be free.

I'm not sure I see where moral or ethical considerations even come into the discussion. The closest moral consideration that applies to the question is the way it affects property rights, but in that regard, it seems that it's the artificial scarcity in information that seems to lack sufficient moral justification.

There are no natural property rights in information itself, due to its conceptual and non-rival nature, and the attempt to take the norms of ownership associated with natural property and apply them to information actually constitutes an abridgment of natural property rights: functionally, 'intellectual property' amounts to a restriction on what patterns other people may arrange their own physical materials into, based on fallaciously reifying the pattern itself into a putative concrete thing to which rivalry applies.

I'd argue that if you can't copy and reuse information, it's even more worthless than a piece of garbage.

As a human being living on this planet, it really worries me that some people feel that their privilege to make a buck from some information is valued more than the ability for mankind to use that information to make progress.

You don't own information. It just happens to be passing through your head on its way to someone else's (if it's worth anything - if it stops at you, it's worthless).

Edit: for the record, I don't think you should be downvoted for your opinion, however much I might disagree with it, and I upvoted you.

Real goods, such as the Chevy Malibu, have a pyramid of raw materials starting with ore mining, through smelting, through plastics creation, through tooling, to piecework to sub-assemblies, to assemblies to product.

Information goods on the other hand start with generally lower value information which gets collected and distributed and refined into higher value information. An inverted pyramid if you will.

And unlike ore, which once its in a Chevy Malibu is locked up 'forever', the information that is created can be re-used in an infinte number of additional products.

Consider a contructed example of company A which makes their money selling the current stock ticker from the NYSE, to company B, which takes that data and does analysis on it to create trading strategies for resale, which are purchased by company C which uses the trading strategies combined with capital acquisition from clients to make their money.

A completely different company, Q, might take the same stock ticker information from company A and make a large LED sign which can display it and sell those.

So the same 'information ore' is used in two separate product streams. There can be dozens of such streams. So evaluating the value of Facebook's information by the number of people Facebook employs really misstates the economic impact of a company like Facebook.

"The argument that the information world is the first to stack industries on other industries is fallacious, and misses the point entirely: Information doesn't take labor for every instance of product."

I don't believe I made either of these claims.

To be clear, the claims I make are; 1) Evaluating the information economy using the 'rules' of the real goods economy fails. 2) The information that Facebook and Google create is more analagous to the ore someone might mine out of a mountain than the end product of vehicle brakes. (the real goods example used in the article).

I will grant you an example of someone making money off creating after market products for the Chevy Malibu as a valid post production economic activity, I know of no examples where people have collected Chevy Malibus and then turned them into a product that itself had mass market appeal.

It is the distinctive characteristic that information can be combined into new information which has its own intrinsic value, without losing or consuming the source information (ie removing its ability to take part in additional economic activity) that, for me, differentiates the two economic models.

The problem is that this "scarcity" (to produce information) wants to be compensated too. And it's not only "scarcity", it's also costly to produce information. The fact that you can make 1 billion copies of Adobe Photoshop for free, for example, does not mean Adobe Photoshop itself costs nothing. It costs something like several tens of millions to make in programmer's salaries. Those paying those millions should get to dictate how you pay for it, like the guy that makes a chair gets to dictate how you pay for his chair.

You seem to think that the scarcity of infomation production means nothing at all, when you say e.g.:

Paying people for work done to create makes sense. It makes an 'economic' structure that mirrors the basic physical constraints. And it is justified according to its 'economic' effects. You give something up, you get something in return.

When you buy Photoshop, it's not just bytes downloaded to your PC you get, which cost nearly nothing (= your ISP bill), you ALSO get a slice of the paid, hard, work of hundreds of people in return.

Why are we confusing technological feasibility (free copies are feasible) what what ought to be done (compensate the creator or not)?

A crazy idea to directly make the software sale more akin to a specific item sale (a chair):

The software maker sets an arbitrary total aggregate expected sale price P and a selling goal (say, X units). Anyone buying before X units are sold pays P/X. For anyone buying after it, the price falls P/X+ (and the first buyers are also given their difference back, either directly or in "store credit"). In the end, if they sell a billion copies, people get the program for say a dollar, but it's OK, because the company is compensated. Actually, this makes popular items essentially free or dirt cheap in the end. For this to work, we need a marketplace like the Mac App Store, so those transactions and record-keeping can be automated.

This restricts the artificially huge profits made by controlling the price, and puts a set price to a free copyable item, like a tangible item has, that reflects the work that went into it. It also keeps the risk of the original sale, i.e if the sell < X, they have a loss.

None of that much holds for paying for copies. The transaction is not fair and square, it is an unwarranted and unjust restriction of personal freedom of those using the information. And as for the global gain, it seems rather lacking grounds of actual evidence.

Well, the global IP industry, sales of software, music, books, magazines, etc, is on the level of trillions of dollars. It would be almost zero with totally free copying. So, at the economic level, there is some support for "global gain". And it's not like the culture would be poorer if less Metallica and Lady Gaga albums where freely torrented (yes, I'm a snob like that ;-).

I think the idea of code (or information in general) being intangible has some problems. Point me to information which exists without being encoded in physical phenomena. All information we've ever encountered exists in the form of specific configurations of matter and energy, and is therefore tangible, just as a house or a car is. It is just barely tangible, since there are many more physical configurations which can reasonably encode information than there are physical configurations corresponding to a usable car.

The term scarcity as usually applied to information is also somewhat problematic because it is not applied consistently between "physical" goods and information. Yes, the fact is that information is easy to copy because it is easily encodeable in a wider range of physical configurations. But we cannot reasonably ignore the effort required to produce it if we want to make a fair comparison. The quality we are interested in is how hard it is to obtain, to have something in the first place, not just whether it is easy to copy. Code is easy to copy, but is hard to produce, and hence I would argue it is still a scarce resource in this sense.

> My use of a physical good inherently inhibits your use.

Not if you first make your own copy of the physical good, the same way you do with information. You said it yourself: you can use your copy of the software without inhibiting someone's simultaneous use. It's just that information has the boon and burden of being easily copyable once you've initially obtained it.

> Would you rather they didn't have the option which would result in the effort not being expended to generate such information?

Yes, I would argue absolutely that valuable information would still be made because those that would benefit just from the information existing - not from the potential sale of said information - would still fund its creation. Someone that wants a painting will still pay for it if or if not they can sell the finished work. The think tank researching a cure for cancer will still have ample funding sources from those who think not having cancer would be beneficial regardless of those sponsors ability to profit off said cure.

> I don't understand how someone can argue that it is unfair that they have an option to do so if they choose.

Its largely a problem because its both default and implied. Its in the same class of problem as if the government tried to restrict air - you had to pay to breathe and are charged per-month. Despite the air being "free" and "everywhere". Its a tough analogy to write though, because there is no true analog to the modern miracle of information propagation being infinite and endless - we truly have nothing else worth so little as a copy of a number to compare it to.

But fundamentally its having your cake and eating it too - if you want to monetize your creations, you make them for free (at expense to yourself) to try to monetize something that has no value (copies of it). Its so abjectly opposed to reality and true scarcity that subconsciously drive people to feel no serious shame in piracy despite them "stealing theoretical profits from the rightsholder". But thats really all you are taking. In another light, a random stranger is offering you something for free and without recompense that they have, just because its so cheap to store, transmit, and replicate. That is magical. We take this modern miracle of technology and bind it in chains to try to perpetuate a model of profit that doesn't make any actual sense in actual reality given the scarce inputs (creative capability, motivation, and efforts) and infinite outputs (information) involved.

And no, we're not just talking about entertainment here. It's impossible to objectively separate entertainment content from more "important" ideas like Uncle Tom's Cabin or even geostationary orbits (popularized by a sci-fi author). It's also impossible to fully separate copyrights and patents, since they have the same legal foundation and purpose.

"Intellectual Property" is one possible way to try to answer all these points, a hack to try to couple market allocation to the information generation issue while also recognizing that it's not real property and is funded by and for the public. It offers a chance, not a certainty, to make money off an investment on information generation through convincing other parts of society to pay for it piecemeal during a limited pseudo-physical-property replication stage. In exchange, it shouldn't be secret, shouldn't cover basic facts of the world or certain other areas where additional generation incentives are unnecessary, and should have limited times taking into account the ongoing and ever increasing societal cost.

I think it's very foolish to mistake implementation issues with fundamental ones and throw out the baby with the bath water unless you've got something better to fund information generation equally effective. And I have yet to hear any proposed scheme by total-anti-IP folks to take its place, merely complaints about the current implementation. I think it'd be far more productive to first direct efforts towards fixing mismatches in historical IP in each of the 3 areas above vs modern times. On the secrecy issue for example, encrypted source code escrow should be a requirement for having copyright protection for everything that isn't open or available source already, and have-your-cake-and-eat-it Trade Secret laws should be eliminated. Patent protection for mathematics (all software patents) should be completely eliminated, copyright is more then enough already for software and better aligns incentives. And new, better ways to reflect ongoing and increasing societal costs, and the divergence in areas of generation, should be added rather than mere fixed times. Ongoing yearly renewal beyond an initial short period at non-linearly increasing cost (either fixed or an increasing percentage of revenue) would be one possible approach.

But all this seems far more useful than anything else I've seen. Total command and control at all levels of the economic stack hasn't proved any more effective for information generation than it has anywhere else in economics. IP has overall worked fairly effective, and it seems to me that the problems it has caused are more down to warts and rust that could be fixed.

The idea that information wants to be free stems from the market principles of supply and demand. Price is determined by supply and demand. Digital information can be duplicated at almost zero cost, so there is a pressure on it to become cheaper and cheaper until free.

The idea that information wants to be free is also contradicted by the idea that "Information is power" etc. The less people you can restrict information to the more it is worth. Also, timely information can be very valuable (like in insider trading) that information can have value (i.e. no free as in beer).

But just because information can be duplicated infinitely, it doesn't mean that it will be duplicated infinitely, meaning that the value of the information will be determined by the costs of production and demand. Will this value of the information be enough to cover the costs? This will be the determining factor as to whether people can continue to make a living from producing information. On the flipside, the costs of making quality information are rapidly decreasing, so it should be getting easier and easier to make a living from information.

In the end, I think that information will always have value. The key will be for the producers of that information to find a way to connect with people willing to pay for it.

The cost to reproduce an existing piece of information is very low (not zero; you still need computing technology).

But the cost to produce an original piece of information is often still quite high. Look at how much it cost to make Star Trek Into Darkness, or for George RR Martin to write his next "Game of Thrones" novel, or Apple to produce iOS 7. These take huge investments in time and technology.

Even the premier product of free culture, the Linux kernel, receives millions of dollars of investment every year in salaries and supporting technologies.

Of course it might be interesting to ask how digital goods are different from tangible objects in economics. But this particular question is made on a wrong assumption. Digital goods can be scarce and hence not "free" by definition.

> But back to the Parse discussion, one of the factors that appears to influence information value is its rarity, or difficulty in obtaining.

Yes, but that's no different from the classical concept of scarcity.

> My claim is that classic economic supply and demand models don't apply to digital goods because the supply of the goods can be infinite and the classic model suggests prices would go to zero in that scenario.

No, no, it doesn't suggest that. That's the problem with your argument. The theory might say that that happens in a world of "perfect competition", which is a very strong assumption. As long as someone has the publishing rights for a digital good, its low marginal cost doesn't imply higher supply and lower price.

This is not really limited to digital goods. Take a hardcover textbook or a cancer-treatment drug: its marginal cost might be a few dollars but given limited supply it can still sell for over $100.

— Richard Stallman, 1986 https://www.gnu.org/gnu/byte-interview

In your example, the employer buys time, not information. Time is significantly harder to reproduce or copy than information is.

So, one way to charge for information is to sell time sensitive information (like stock information), but then what you're really selling is time exclusivity.

Selling information without any kind of unique or time sensitive properties is doomed to fail — the only thing that made it once possible was technical limitations; information needed for instance paper as a vehicle to distribute it. Those technical limitations are gone now.

What is the difference in value between a CD with the latest release of Ubuntu burned on it, and the download? download and a bootable Flash drive?

There is a great experiment you can run which goes like this; At one end of an athletic field, place a chess board with a queen on it on one of the squares. At the other end of the field have a table where people can get a quest. Offer to pay a person $5 if they will walk to the end of the field, note where the queen is, and come back and tell the quest giver. At the mid point of the field set up an information seller. They offer to sell you the location of the queen for anywhere between 20 and 80% of the reward price.

This simple experiment lets you see all sort of mechanisms in play that control information value. On the one hand you can see the range of values people apply to their own time (acquisition cost), their willingness to retain value (do they then go back mid-queue at the sign up table and start offering to sell the information for some fraction of the price to anyone?) At what threshold to people start trying to break the rules (a notion that is similar to price inelasticity but has a component like the 'black market demand').

Interesting questions to be sure.