Krishwords

One of the three Nobel Prize Winners in Economics this year (2007) is Eric S. Maskin. I am reproducing the conclusion of his recent paper.

Intellectual property appears to be an area in which results that seem secure in a static model may be overturned in a sequential setting. The prospect of being imitated inhibits inventors in a static world; in a dynamic world, imitators can provide benefit to both the original inventor and to society more generally. Patents may be desirable to encourage innovation in a static world, but they are less important in a sequential setting, where they may actually inhibit complementary innovation.

The static-sequential distinction is more than just a theoretical nicety. Indeed, it may help resolve a puzzle emanating from the U. S. natural experiment in software patents. Strikingly, the firms that obtained the most software patents (largely firms in the computer and electronics hardware industries) actually reduced their R&D spending relative to sales after patent protection was strengthened (Bessen and Hunt 2004). This behavior is difficult to reconcile with the static model, in which the prospect of patents should encourage R&D, but is quite consistent with the sequential model and specifically Proposition 7.

Thus we would suggest a cautionary note about intellectual property protection. The reflexive view that “stronger is better” could well be too extreme; rather, a balanced approach seems called for. The ideal patent policy limits “knock-off” imitation, but allows developers who make similar, but potentially valuable complementary contributions. In this sense, copyright protection for software programs (which has gone through its own evolution over the last decade) may have achieved a better balance than patent protection.

In fact, this is the premise behind open source. Open source, by allowing “imitation”, helps companies and organizations innovate. We have seen many examples of such an innovation including Linux, Apache, MySQL, etc. If we even look back further, we can note that science had the same kinda approach from the beginning. Sharing of knowledge leads to innovation. Software is knowledge and its sharing is crucial in future innovations.

Business community advocates free markets. But these free marketers fail to understand the meaning of free in “free markets”. If they had understood the meaning in that case, they would have understood the meaning of free in open source too. Business community, talking about the “cost value” in open source and ignoring the “freedom” aspect of it is shocking. That too, when you find a post advocating something like that in the Wikinomics blog, it makes it doubly shocking. Wikinomics is a book about “collaborative value” in the current day world and how it transforms the business world into a win-win situation for both business community and consumers. The blog associated with the book has a post with the following statement

This got me thinking about open source evangelists. These are the folks (you probably have a few in your organization) that for one reason or another believe that open source is always the way to go – that it’s simply better, no matter what. This is the group that doesn’t understand that open source is simply another licensing model, not a religion.

Unlike what the author tries to portray, the problem doesn’t lie with the advocates of open source. Rather, it lies with people like the author of the post and others in the business community and tech media. He calls open source as religion. It just shows his lack of understanding of the word freedom. Can I call all those who clamor for democracy (including, maybe, the author of the blog) as members of a religious group? Can democracy be termed as religion? Let me take up a term that is close to the hearts of the people in business community. The term is “free markets”. Instead of defining the free in the free markets as freedom for buyers and sellers to transact without regulations, if I define it as a market place where all products are free of cost, will the business community accept my argument? When they try to argue that the term means freedom and if I call them as religious preachers, will the business community be willing to accept it? If the business community finds this argument ridiculous, now they will understand how open source advocates feel about those people who try to twist the true nature of open source to their narrow advantage. The freedom offered by open source is the biggest long term advantage the enterprise can get. In fact, cost savings are secondary. The freedom to break open their business from the shackles of any single vendor and the associated flexibility is going to be more important than any cost savings they will have. If the business community cannot understand the importance of the freedom, they are the ones who are going to lose out. Communist empire, USSR, failed because of the lack of freedom not due to the lack of freebies. It is the same freedom that is going to make or break businesses. A smart company that adopts the freedom offered by the open source platform will be successful in the long run. All others will eventually vanish against the onslaught of freedom. In fact, open source movement was formed with the idea to help business take advantage of this freedom. If the business community fails to take advantage of this platform, it is their own funeral. Probably, the author should put his fellow community members on notice rather than the open source advocates. It will be even better if the author tries to understand the idea conveyed in the book “Wikinomics”.

For more articles on the related topic, check out the articles here.

PS: I just bought the book yesterday. After reading the introduction, I get a feeling that the authors of Wikinomics are trying to advocate a philosophy that freedom to collaborate and share will transform the markets in the future. If this is their thesis, the blog author will be better off reading the book deeply.

Facebook opened itself as a platform for application developers 3+ months back. Many in tech media were too eager to call facebook as an open platform. I was not all that happy about the “openness” of facebook then and I wrote a post in June talking about a decentralized social networking platform. In fact, I mentioned about the walled garden nature of facebook to Robert Scoble in one of his Kyte sessions. He said he is not all that worried about putting data inside the walled garden. But I am happy to learn that he has changed his opinion now and he, along with Marc Canter, Joseph Smarr and Michael Arrington are promoting a bill of rights for users of social web. This is the right step in the right direction. Once users become aware of the need for openness in the social networks, amazing things can happen. I am pretty convinced that we will be seeing more and more social networks opening up their platforms. We are going to see application developers developing apps for all these social networks. Once the social networks open up their platforms, the users are going to see a need for openness in the apps. They will want the apps to work on all the platforms. They will want to move around their data from all apps across all social networking platforms. This will end up in an open ecosystem which will ultimately benefit the consumers and there will be no single company with a monopoly hold. This is what open source had managed to achieve in the traditional software world. Unfortunately, before open source could gain foothold, Microsoft has established its monopoly in the software world. Open source faced an uphill task, first convincing consumers about the need to have open source code and then fight back against the Microsoft monopoly. All these years of hard work by the open source community has increased the awareness among consumers about the need for open standards. This, in turn, is translating into calls for open data, open communication, etc. Open source has taught us about the advantages of having an open ecosystem and how it benefits the consumers. Even though it appears like an attempt by certain industry leaders to hijack the agenda, the bill of rights for users of social web is a good step in this direction. Even though there were calls around the tech blogosphere for such an open ecosystem for quite some time now, this bill of rights will definitely help accelerate the process of increasing the awareness among the consumers about the need to take their data and their friends with them (when they move to other networks). It is better to wake up early in the game, unlike what happened in the traditional software field. It is time for consumers to tell the social media sites about the direction they want to take. I think Marc Canter, Robert Scoble and others can play a major role in creating this awareness among the users. What do you think about this bill of rights? Are you worried about the portability of your data and friends?

Bingo to Jeremy

But when you stop and look at how technology has changed and opened in response to networks, the Internet, simple/open protocols, view source, and self-serve business systems, there’s a clear pattern emerging. Strong forces are at work here–strong enough that you’re better taking advantage of them rather than fighting them. You will lose. I don’t care if you’re Microsoft, Google, or even Facebook (the latest golden child).

Open beats closed. Simple beats complex. Freedom of choice beats being told what technology to use.

The blogosphere got a bit excited today with an article on New York Times about the plans of Google and Microsoft to offer an online personalized health care records for consumers. This excitement was further enhanced by a post by Philipp Lenssen with screenshots of a prototype of Google Health service.

Right now, our health care records are at the mercy of doctors and insurance providers. US federal law allows us to request our health care records. However, these records are only available in a paper format. Even with the doctors and insurance providers, it is kept either in a paper format or in a proprietary software format. There is no option for patients to have their health records in the digital formats. After some egging by the Bush administration, some of the providers have moved the health records online. For example, my health care provider is offering my health records online. But it is not the case for everyone. Even among those providers who offer health records online, we are at the mercy of insurance companies or health care providers. There is no independent centralized personal health record “repository”, with the user (patient) having a complete control of who has access to what information about their health. This is the area which is interesting to both Google and Microsoft. Both the companies are working on a system to provide this opportunity for users. Please read the New York Times article for more information on this. I would also like to point out to Adam Bosworth’s detailed post on this topic. Fellow TechBiz Media blogger, Deepak Singh, has written quite a lot on this topic. Unlike Deepak, my interest in this area is more on the peripheral level. I will discuss about certain issues that are of interest to me and offer my opinions related to the privacy issues associated with an online Personal Health Record (PHR) system.

The first and foremost concern for me is that the health care records should be stored in a system that adopts open standards. Efforts are underway to develop open standards based methods to extract RDF data from xml documents. It is very important to develop Microformats to manage healthcare information. A company that uses open standards to store health data on their online system will gain the confidence of the users. This will ensure that user’s vital health care information is not locked down under a proprietary system and it is accessible without a need for a particular vendor providing applications.

The second and equally important concern is about the search engine offered by such vendors. It is very vital that a vertical search engine that could provide accurate information is made available. It is no easy task and companies like Google, Microsoft and many startups are working on this area. Since we cannot take chances with our health, the accuracy of the search engines becomes important. I expect Google to have an advantage in this area, even though Microsoft seems to have made some important acquisitions in this regard.

The final concern is about privacy. Many people have written about it. In fact, the fight over privacy could be the reason for the delay in the implementation of online PHRs. Some people are worried about putting all our health related information under a single company. I am not too worried about it. I would be comfortable with Google having my records than my insurance company or a health care provider or a startup as long as Google offers me a complete protection of my privacy. I am not all too worried about govt.’s ability to scrutinize my health records either. Anyway they will get my health records even if it is stored in a paper format. In fact, a big chunk of Americans don’t mind govt. looking into their health records including their genetic information (via link). As long as I have confidence that the company that offers online PHR will not mine my health data and not allow anyone else to look at it, I am fine with the privacy implications. It is up to Google or Microsoft or any other company, clamoring to hold my PHR data, to convince me on the privacy issues. It is a big mental shift for most of the people. Since I have understood about privacy in this Web 2.0 era and  I am comfortable with the new age ideas about privacy, I am not all too worried about it when it comes to online PHRs. As long as I have a system where I can control who views what from my health care records, I am ready to use such a system.

It is time we make a paradigm shift about how we manage our health care records. It is time we learn more about our health and take into our hands the power to make intelligent and informed decisions about our health. To do this, an open standards based vendor neutral PHR with a good search engine and a good privacy policy is needed. Once we bring in this paradigm shift, we can then start wondering about how we can use the “artificial intelligence” of the semantic web to help us manage our health care better.

I would like to hear about what you think about online PHR systems and your concerns about it.

We are dreaming about decentralized social networks, where we can take our data and friends to wherever we go. Some of us are even wondering if Facebook and other social networks will take the necessary first step. But the venture capitalist Fred Wilson says that if people leave Facebook for its walled garden, it won’t make a dent on them. He also explains why

I wish it were so, but most of Facebook’s traditional users (like my two daughters) don’t care that their data is locked up in Facebook. I’ll show them my Facebook running in Netvibes when they wake up this morning and they’ll say “that’s nice dad but why would you want to do that?”.I don’t see a Facebook rebellion happening anytime soon. The Techcrunch 50,000 might leave when they realize that they can do most, if not everything, that they do in Facebook on the web on a platform they control. But that won’t make a dent in Facebook’s core audience.

In a way, Fred is right. Facebook’s core audience doesn’t care about walled gardens. They don’t care if they cannot take their data and friends to another network. Sounds familar? This is what happened when Microsoft was establishing their “monopoly” in the market. People didn’t care whether they were getting sucked into proprietary formats. People didn’t care about the vendor lock-in with Microsoft. Eventually, people did start caring about it. People wanted to take their documents and media files to use with other software and/or devices. Once a new technology matures, and the honeymoon period is over, people started worrying whether their friends and/or relatives, without a copy of Microsoft word, will be able to open the document they just sent to them. They started worrying about whether a video they produced will show properly on their friend’s computer or other media device. A realization, albeit a bit slowly, came, about the dangers of getting struck to a proprietary technology. The non-techcrunch Joes started realizing that their documents and media means nothing to folks without Microsoft applications. They started asking for open standards. Governments all over the world started implementing open standards and, in some cases, open source software. I expect a similar realization on the social networking scene too. We should not wait for the arrival of such a realization before we start building open standards based, vendor lock-in free, social networks. It is very important that there is an open standards based platform available when people start wanting to have open social networks. The future of social networking is going to be open because, sooner than later, people will realize that they want to live in a democracy rather than a monarchy or under a dictator.

Update: Wired has an article where they call for opening up of social networks.

Tags: socialnetworks, socialnetworks, open standards, openstandards, microformats, facebook

You can listen to the talk given by Simon Willison on OpenID, at Google. Check it out.

CBRonline.com reports that if all the developers upgrade to GPLv3, it is possible to stop Microsoft’s immoral bullying tactics.

“Microsoft made a few mistakes in the Novell-Microsoft deal, and GPLv3 is designed to turn them against Microsoft, extending that limited patent protection to the whole community. In order to take advantage of this, programs need to use GPLv3,” explained FSF founder Richard Stallman in an essay explaining why developers should upgrade to v3.

“Microsoft’s lawyers are not stupid, and next time they may manage to avoid those mistakes. GPLv3 therefore says they don’t get a ‘next time’,” he added. “Releasing a program under GPL version 3 protects it from Microsoft’s future attempts to make redistributors collect Microsoft royalties from the program’s users.”

When the facebook platform was opened to public last week, everyone was comparing it to how Microsoft built its ecosystem. But there is one subtle difference between the Microsoft’s approach to their ecosystem and facebook’s approach. Microsoft tried their best to promote their apps over the other third party apps. They integrated their apps much more closely to their platform and had many apps pre installed on their platform. However, facebook didn’t try to promote their apps over the other third party apps. They allowed their apps to compete on a level playing field with third party apps. Except for some of the apps they had from the time before their platform announcement, all their apps appears in the same application directory available for other third party applications. I feel that facebook has shown better ethics than Microsoft in building an ecosystem around their platform. Kudos to facebook for this.

Observed from the Ali Partovi’s interview on VentureBeat.

Michael Calore writes on Wired about the new effort by FSF to promote Ogg format

In an effort to rally support for the underdog media format, the Free Software Foundation has launched PlayOgg.org, a website promoting awareness of the Ogg format. It’s an educational primer for playing Ogg Vorbis audio files and Ogg Theora video files on Mac and Windows desktops.

Supporters of open-source have long championed Ogg as a free software alternative to proprietary, licensed audio and video formats. Support for Ogg Vorbis audio has waxed and waned over the years since digital music hit the mainstream.

But with the launch of the FSF’s web campaign, the time may be ripe for Ogg Vorbis to truly shine. According to Chris “Monty” Montgomery, creator of Ogg and founder of the Xiph.org Foundation which oversees Ogg’s development, such big-name backing has been a long time coming.