scarcity – Techdirt (original) (raw)

‘Baldur’s Gate 3’ Director Appears To Be Very Confused About The Secondary Market & Who Created It

from the from-inside-the-house dept

It can be easy for people to dislike the secondary market if they aren’t the ones selling into it. Commonly referred to as “scalpers”, the fact is that the secondary market is a very important part of the economy. It’s how goods retain some of their value, for instance. And when goods are sold several times, this naturally feeds into the economy and tax revenue for the country. It can also be a fantastic indicator of pricing efficiency in the primary market. For instance, if a good is bought and able to be resold very quickly on the secondary market for more than the original price, that can be an indicator for the original producer that they can consider pricing their goods higher.

But if you suddenly can’t afford a limited good because of its cost on the secondary market, that can certainly be aggravating. And apparently sometimes the original producer of the product can be annoyed on fans’ behalf as well. That is the case with one Larian director who is very mad at “scalpers” for selling Baldur’s Gate 3 Collector’s Edition copies at ten times the original price.

This was brought to stark attention by Larian’s publishing director Michael Douse, who tweeted (exxed?) to express his disgust at the listings he was finding online.

“Hate scalpers, man,” he wrote on X. “I understand how commodity works, but this CE isn’t a commodity it’s designed to make someone happy not rich.”

Now, frankly, the rest of that Kotaku post is likewise filled with a bunch of empty-calorie remarks on how bad “scalpers” are and how everything about this entire situation sucks and blah, blah, blah. Whether the author was merely attempting to toss red meat to readers or simply has a profound misunderstanding of what the secondary market is and does is of no material importance to me. I’d much rather focus on some very correct and key points that same author makes.

The main thrust of Douse’s complaint above is about people who bought the Collector’s Edition primarily to trade it, not because they’re some superfan or whatever. In other words, according to this complaint, the problem is that people looking to make money off the Collector’s Edition are buying it and creating scarcity for the everyday fan, thereby driving the price up to a point where most of those fans cannot afford it, or at least have to buy it at a highly inflated price. Now try to square that complaint with the entire existence of a Collector’s Edition in the first place.

It’s a situation that’s created by the artificial scarcity of the object in the first place, where a company deliberately doesn’t make as much of something as there are people who want to buy it, then price that thing at far more than it costs to make (because, that’s how commerce works) to reduce the number of people who’ll find it within their means.

If it were mass produced, it presumably wouldn’t be a “Collector’s” version (whatever that actually means—“I’ve collected all one of this Baldur’s Gate 3 boxed version!”), but then it would be available for everyone who wants it at the recommended price. And scalpers wouldn’t have a market to exploit.

Exactly! If Douse and Larian would like to rid the world of inflated prices for Collector’s Editions, let them go first. The call, as the saying goes, is coming from inside the house. Larian created this entire secondary market through its own decisions on production quantities for a special version of the product it chose to make. And, to be clear, it can absolutely do every bit of that without any complaint from me.

But then those same people that created the secondary market should probably stop whining about how it operates.

Filed Under: baldur's gate 3, collector's editions, collectors, michael douse, scalpers, scarcity, secondary market

Making Money By Understanding The Difference Between Analog & Digital

from the scarcity-and-abundance dept

One of the central ideas of Walled Culture the book (free digital versions available) is that there is a fundamental difference between analog and digital, and that copyright fails to recognize that. Instead, it seeks to impose what is an inherently analog approach based on scarcity to the online world where abundance is the norm. The very different dynamics in the two realms are neatly illustrated in an article in the New York Times. Its title “In a Digital Age, High-End Outdoors Magazines Are Thriving in Print” underlines why it pays off to recognize that digital and analog are different, and how online publishing may be in the doldrums, but there still money to be made by taking a different approach:

There are sprouts of life, even profitability, on the landscape of print media and magazines, cratered by the pixilated bombardment of the digital age. High-end niche periodicals are popping up, but the trend might be most evident in a burst of small-batch, independent outdoors magazines like Adventure Journal, Mountain Gazette, Summit Journal and Ori. They are crowding into quiet spaces of narrow lanes — climbing, surfing, skiing, running and the like — where quality is key, advertising is minimal and subscribers are faithful. Most do not put their content online; this is journalism meant to be thumbed through, not swiped past.

As the article explains, the new wave of small-scale, luxury magazines are the antithesis of throwaway digital material with clickbait titles designed to trick people to view briefly and then move on:

The magazines are sometimes oversized and increasingly matte finished, filled with edge-to-edge photographs and literary heaves. They can cost $25 or more per issue. They are meant as much for the coffee table as the shoulder bag — designed to be collectible, not disposable.

What is particularly interesting about this evolution of analog magazines is that it fits perfectly with the idea of the “true fan,” which Walled Culture the blog and the book have explored at some length. Indeed, the true fan approach means that these high-quality and highly-valued publications can be offered alongside free material placed online. Significantly, the New York Times articles notes that “These new magazine owners aren’t Luddites; they use digital savvy to sell paper and ink.” In other words, digital is a way to generate revenue from analog. Moreover, the analog journals use the same ideas typically employed by those seeking to maximize engagement and revenue from their true fans and patrons:

The Surfer’s Journal persists as envisioned, now with about 28,000 subscribers (six issues a year for 84,or84, or 84,or25 for one) and eight “sponsors” (each paying $70,000 per year). Thousands of other copies are sold in surf shops and bookstores. The company has expanded into books, a popular podcast and The Golfer’s Journal, with manicured green grass taking the place of swelling blue oceans.

This approach won’t work for all creators, but its a timely reminder that the analog and digital are different. Acknowledging that difference, rather than simply trying to impose the outdated rules of one world on the other, allows them to play complementary roles in supporting creators and generating revenues by building strong relationships with true fans.

Follow me @glynmoody on Mastodon and on Bluesky. Originally posed to Walled Culture.

Filed Under: abundance, analog, digital, luxury magazines, scarcity

Crypto Bros Sue Pharma Bro Martin Shkreli Over Making A Copy Of That Wu-Tang Album The US Government Briefly Owned

from the yes,-that-headline-actually-makes-sense dept

You know those lawsuits where you kinda hope everyone can lose? Yeah. This is one of those.

Some crypto bros are suing the world’s most hated pharma bro, who jacked up prices on some essential pharmaceuticals before eventually being arrested and sentenced to jail. And the lawsuit is about a Wu-Tang album that almost no one has heard, that the US government briefly owned, which is now being sorta, kinda, but not really offered as an NFT where if you buy in, you only speed up the release date from nearly a century away by 88 seconds.

I fear this is going to take some explaining.

A decade ago, the Wu-Tang Clan did something of a fascinating stunt. It announced it was releasing a new album, Once Upon A Time in Shaolin, but that only one single copy would be sold. Part of the deal was that the album could only be released publicly in the year 2103, 88 years after it was sold. While the original reports suggested that it wouldn’t be sold at auction, in September of 2015, it was. A few months later, it was revealed that Martin Shkreli won the bidding at somewhere around $2 million.

The timing on this is fascinating, because in between the time he won the auction and when it was revealed that he did, Shkreli became the face of all that is terrible in pharmaceuticals when he went on TV to try to defend his decision to suddenly increase the price of Daraprim, an important anti-parasitic drug from 13.50atabletto13.50 a tablet to 13.50atabletto750. That all happened just weeks after he won the auction.

Just a couple months after that, Shkreli was arrested and perp-walked for securities fraud. Three years later, in 2018, he was sentenced to seven years in prison, along with a 75kfineand75k fine and 75kfineand7.3 million in forfeiture. That included the Wu-Tang album. The DOJ’s press release about the sentence literally mentions the album in the very first paragraph.

Earlier today, in federal court in Brooklyn, Martin Shkreli was sentenced by United States District Judge Kiyo A. Matsumoto of the Eastern District of New York to seven years’ imprisonment for committing securities fraud and securities fraud conspiracy, to be followed by three years’ supervised release. The Court also ordered Shkreli to pay a 75,000fineand75,000 fine and 75,000fineand7.3 million in forfeiture. Earlier this week, the Court signed a Preliminary Order of Forfeiture, which will allow the government to seize substitute assets to satisfy the forfeiture judgment if necessary, including $5 million held in an account that had been used to secure Shkreli’s bail, the “Once Upon A Time in Shaolin” album by the Wu Tang Clan, the “Tha Carter V” album by Lil Wayne, and a Picasso painting.

While Shkreli was able to get out of prison after four years, in the interim, the DOJ sold off the Wu-Tang album to what was originally “an anonymous buyer.” In the fall of 2021, however, that anonymous buyer was revealed to be some crypto bros behind the decentralized autonomous organization, PleasrDAO, though it appears others were involved as well:

Now the album has found yet another life on the frontier of digital art and cryptocurrency, having been sold for $4 million to PleasrDAO, a collective that has existed for less than a year but has already built a reputation for acquiring high-profile digital works.

In a complex deal with multiple parties, one of whom remains unidentified, PleasrDAO acquired “Once Upon a Time” after its sale in July by the federal government, which had seized the album to satisfy the balance of a $7.4 million forfeiture money judgment against Mr. Shkreli that was part of his sentencing in 2018.

As the PleasrDAO folks made clear, this album is kind of an NFT of its own. There’s only one in the world, and it’s about as non-fungible as can be.

In the interim, not much has happened with PleasrDAO and the album. Until now.

Just last week, PleasrDAO did two things. First, it set up a site for the album, conveniently at thealbum.com. It has a countdown until the year 2103, but allows anyone to buy… something. Technically, you appear to be buying the ability to speed up the release of the album. 1takes88secondsoffthetime.1 takes 88 seconds off the time. 1takes88secondsoffthetime.11 takes 16 minutes and 8 seconds, $111 gets everyone 2 hours, 42 minutes, and 48 seconds closer to release, and onward. There are typical DAO/NFT related features like leaderboards on there too.

The actual details are still pretty weird. If you pay up, you do get access to a sampler, but not the actual album.

Buyers will only receive an “encrypted” version of Shaolin that they cannot actually listen to. The deal will instead unlock exclusive access to a five-minute audio “sampler” composed of pieces of five tracks; the rest of the album will remain sealed.

As for the reduction in time before the album is actually released, some of that is apparently theoretical/wishful thinking:

It’s worth noting PleasrDAO likely hasn’t finished negotiating with the group and producer Cilvaringz for full rights to Once Upon a Time in Shaolin. According to Decrypt, Pleasr has only acquired rights to 16 of the 31 tracks on the album and will “share progressively larger pieces of that selected library with purchasers of the encrypted album over time.”

I’m sure that won’t lead to any problems at all.

And that brings us to the second bit, which should be clear from what’s been discussed above. Just days before releasing this, PleasrDAO sued Martin Shkreli, claiming he violated the terms of the original purchase agreement and kept a copy of the album for himself. There’s a lot of fun stuff in the lawsuit, but it boils down to this.

PleasrDAO bought the Album in two transactions in 2021 and 2024, for approximately 4,000,000,and4,000,000, and 4,000,000,and750,000, respectively. The Album was supposed to constitute the sole existing copy of the record, music, data and files, and packaging. It now appears, however, that Shkreli improperly retained copies of the data and files at the time of the forfeiture and has released and/or intends to release them to the public. Such actions would cause PleasrDAO to incur significant monetary and irreparable harm, and give rise to numerous claims for relief under the forfeiture order and common law.

The complaint spends almost as much time on Shkreli’s pharma/securities misdeeds as it does on the actual complaint here. It makes it feel almost like this whole lawsuit is part of the marketing campaign.

As for the evidence that Shkreli violated the terms of the deal, well:

On June 18, 2022, during one of these live streams, Shkreli admitted that he played the Album for his followers. He stated, during the live stream, “Yeah, that’s the Wu-Tang album for all you crazy streamer people.”

On June 22, 2022, during another live stream on YouTube, Shkreli was asked if he still has a copy of “Once Upon a Time in Shaolin.” Shkreli said, “I do. I was playing it on YouTube the other night even though somebody paid $4 million for it.”

On June 30, 2022, during another live stream, Shkreli again played a portion of the Album and again admitted to having retained the Album, stating: “of course I made MP3 copies, they’re like hidden in safes all around the world . . . I’m not stupid. I don’t buy something for two million dollars just so I can keep one copy.”

And then there’s this:

On April 13, 2024, a member of PleasrDAO posted a photo of the Album on X (formerly Twitter), and in the comment thread below, Shkreli made various comments in which he admitted to retaining copies of the Album’s data and files and streaming them to an internet audience:

a. “LOL i have the mp3s you moron”

b. “i literally play it in my discord all the time. you’re an idiot.”

c. “so what are you arguing about? this thread is about someone listening to a CD > 5000 people have…”

d. “yeah i have the music, sold the plastic”

Also, in case you’re not yet hating everyone in this story:

On May 13, 2024, Shkreli appeared on a video-recorded podcast posted on YouTube. In the video, Shkreli stated that he “burned the album and sent it to like, 50 different chicks[.]” He then asked the interviewer, “Do you know how many blowjobs that album got me? You think I didn’t make a fucking copy of it? Are you joking?” He also stated that “thousands of people have listened to it. I sent the mp3s to all these people.”

PleasrDAO thus claims:

Shkreli therefore violated the Forfeiture Order’s provisions requiring Shkreli to forfeit his interests in the Album and prohibiting him from taking any action that would reduce the Album’s value

PleasrDAO claims that under FRCP 71, they’re able to enforce that violation, and that could be the case (certainly not my area of expertise), though it seems weird.

I had also wondered if PleasrDAO was even an actual party that could bring a lawsuit, given that part of the point of DAOs was that they weren’t traditional corporations and were, instead, just effectively a smart contract. But the lawsuit clarifies:

PleasrDAO is an exempted foundation company established in the Cayman Islands located with a registered address at Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman, KY1-1111, Cayman Islands.

PleasrDAO then immediately sought a temporary restraining order on Shkreli, which the court promptly granted.

Having reviewed Plaintiff’s Verified Complaint and the moving papers and declarations submitted by Plaintiff, the Court finds that:

Plaintiff is likely to succeed on the merits or raises sufficiently serious questions going to the merits of its claims for third-party enforcement of the Forfeiture Order; violation of the Defend Trade Secrets Act; misappropriation of trade secrets; tortious interference with prospective economic advantage; unjust enrichment; and recovery of chattel;

It also sets in motion the process to turn that TRO into a preliminary injunction, while also demanding that Shkreli reveal who he gave the album to, plus some other stuff, while demanding that all copies be returned. And I always find it funny when there’s a demand to “return” a digital file. As if that were a thing.

Pursuant to the Court’s equitable powers, Defendant to provide an inventory and account of (i) the copies of the Album’s data and files that Defendant retained; (ii) the individuals to whom he distributed those data and files; and (iii) the profits traceable to his retention and distribution of the data and files, and/or an order authorizing Plaintiff to examine Defendant for the purpose of obtaining information regarding the location of his retained and distributed copies of the Album and its data and files, under FRCP 64 and CPLR § 7112; and

Seizure of all of Defendant’s remaining copies of the Album’s data and files and/or the return of those copies pursuant to 18 U.S.C. § 1836(b)(2), FRCP 64, and CPLR § 7102(d)(1).

So, yeah, from the sound of it, Shkreli’s probably in some amount of legal trouble here. But, what else is new?

All in all, what a dumb situation all around. This is where we end up in a world where we create legal fictions of scarcity over something that is inherently abundant. We end up in this weird world where legitimate scarcity and artificial scarcity are considered the same thing, when any thinking person recognizes they’re not.

The whole NFT/DAO space could actually be interesting in exploring those boundaries and differences, but instead mostly turned into a mess. And mixing this album into it only makes things more complex. Because here you have legit scarcity in the form of the one physical album, competing with artificially enforced scarcity of copyright laws (even though this isn’t a copyright case), and the reality that music can be infinitely copied and shared without a loss.

No one is defending Shkreli here, as he seems like legitimately a horrible person. But if we just take a step back from all that and think about all of this logically, it never, ever makes any sense to argue that he shouldn’t be allowed to keep a copy of the music.

Either way, this all adds up to quite the bizarre story. A decade ago, I thought that Wu-Tang experiment of the single album was a fun, creative idea to play with scarcity and abundance. But the fact that it now results in this monumentally stupid situation, involving NFTs, Martin Shkreli, the DOJ and more should say something about why trying to put artificial limits on abundance is a fool’s errant.

Filed Under: dao, martin shkreli, nft, ownership, scarcity, wu tang
Companies: pleasrdao

Error 402: Information Wants To Be… Freemium?

from the scarcity-and-abundance-returns dept

Last week in the Error 402 series on the past, present, and future of web monetization, we talked about the whole “information wants to be expensive, information wants to be free” dilemma, that partially explained why early paywalls failed, and why display and search ads seemed to be the primary way in which internet content was monetized.

But, still, plenty of people were uneasy with this setup. And there were good reasons to be concerned. The online ad market is, inherently, cyclical and seems to go through fads. It also raises questions regarding what power the advertisers have over the content. And, of course, there are many security concerns regarding online ads as well. But, most of all, ads tend to be pretty damn annoying in many cases. They are often intrusive and not at all helpful. There are some exceptions, and there are cases where well done ads can actually have value, but those tend to be few and far between.

And so it was inevitable that people would begin to seek out alternatives. A few early internet services started to find some level of success by offering a free version of their service and then eventually upselling users to a premium offering. Venture capitalist Fred Wilson noticed this pattern in 2006 and talked about how it was his favorite business model, but that it needed a name.

Give your service away for free, possibly ad supported but maybe not, acquire a lot of customers very efficiently through word of mouth, referral networks, organic search marketing, etc, then offer premium priced value added services or an enhanced version of your service to your customer base.

He correctly noted that this kind of setup wasn’t entirely new, pointing to shareware and other offerings, but also highlighted that it worked even better on the internet:

It works even better with web native services. A customer is only a click away and if you can convert them without forcing them into a price/value decision you can build a customer base fairly rapidly and efficiently. It is important that you require as little as possible in the initial customer acquisition process. Asking for a credit card even though you won’t charge anything to it is not a good idea. Even forced registration is a bad idea. You’ll want to do some of this sort of thing once you’ve acquired the customer but not in the initial interaction.

While there were various comments suggesting what this could be called, it wasn’t long until a comment from Jarid Lukin won the day, naming this business model “Freemium.” This caught on almost immediately, and became a pretty standard strategy for many online services, though with mixed levels of success and failure. As an article about the early days of Freemium highlights, Wilson named six companies in his original blog post, and two of them still have a similar freemium setup, two of them still have it but in a deprecated and hidden manner, and two others have dumped the freemium setup altogether.

It’s not a golden bullet, but it remains a useful tool for many web services. Of course, web service is not the same as pure web content, and experiments in freemium for content are a more recent phenomena.

The trickier part when it comes to content is providing that “extra” value that makes the paying part worth it. With a web service, you can figure out some interesting layer of scarcity to make pay-only: it could be more storage, or more features, or less intrusive branding, or more users. There are a variety of different levers you can pull.

With content, it’s harder. To make it work, it still needs to be something scarce to make it worthwhile to purchase, as anything widely available is trickier to convince people to pay for at any reasonable scale. Here at Techdirt, we actually started experimenting with “premium” scarce features back in 2009. We offered merch (scarce), physical signed books (scarce), and even a chance to have lunch or spend a work day with me (something a surprising number of fans actually did!).

We’ve also experiment with other kinds of scarcity such as our Crystal Ball, that lets you access many Techdirt articles before anyone else can see them or access to our Insider Discord chat.

To us, these were always examples of a kind of freemium setup, in which the content (abundant) remained available, but the scarcities cost money. However, the real leap forward with freemium and content came a bit later with various services that offered a kind of hybrid subscription model, which is what we’ll discuss in the next edition (which will come after the holidays, early next year).

Filed Under: abundance, business models, error 402, freemium, scarcity, web monetization

Techdirt Podcast Episode 301: Scarcity, Abundance & NFTs

from the more-or-less dept

We’ve got a cross-posted podcast for you this week! Recently, Mike appeared on the Ipse Dixit podcast with host Professor Brian L. Frye — the inspiration for our Plagiarism Collection of NFTs and, previously, our OK, Landlord gear — for a wide-ranging discussion about scarcity and abundance in the digital age. You can listen to the whole conversation on this week’s episode.

Follow the Techdirt Podcast on Soundcloud, subscribe via Apple Podcasts, or grab the RSS feed. You can also keep up with all the latest episodes right here on Techdirt.

Filed Under: abundance, brian frye, nfts, podcast, scarcity

Techdirt's 'Plagiarism Collection': A Plagiarized Set Of NFTs About Plagiarism

from the figure-this-one-out dept

As we noted last week, I’m going to be writing a deep dive paper, similar to my Protocols, Not Platforms paper, that explores the ins and outs of NFTs — looking at the legal, cultural, economic, environmental issues related to NFTs. The idea is to explore the ways in which digital scarcity could prove to be different and interesting — and also the many ways in which it may not be interesting at all. If you’re at all interested in supporting this project, our crowdfund to back the paper (and to get a piece of the resulting NFT of the paper) is still going, though not for much longer.

As we’re exploring these issues, however, we’re also going to be doing a bit of experimenting with NFTs ourselves, to better understand how everything works. And the first thing we’re doing is plagiarizing works by law professor/conceptual artist Brian L. Frye. You can now see our Techdirt Plagiarism Collection of eight NFTs, plagiarized (but, if I say so myself, vastly improved) from Brian L. Frye (you can see them all in the iframe below, but it’s better to click through and see the whole thing). Those NFTs are now up for auction in an auction that will run for the next 10 days, ending on October 7th at 6pm PT (9pm ET).

I imagine that some of this will require some level of explanation — though, I’m somewhat wary of killing the frog in the process.

If you’re unfamiliar with Prof. Frye’s work, you’re missing out. You may recall us writing about his “OK, Landlord” project last year (which also became “OK, Landlord ?” Techdirt gear).

You may also recall that earlier this year, Frye wrote a piece for Techdirt criticizing the process of legal scholarship. Towards the end of that piece, he mentioned and linked to a recent Law Review piece he had written entitled Deodand, which as Frye describes it:

This article is a work of conceptual art reflecting on the concept of doing conceptual art in the medium of legal scholarship. It is also an homage to Yoko Ono’s work Grapefruit.

The paper itself is well worth reading, explaining what “deodand” means, exploring the nature of common law, our understanding of common law, and explaining what Yoko Ono and her book Grapefruit have to do with all of this (I won’t spoil all of it). I will include this tidbit that explains the structure of the paper, however:

As Ono observed, art is everywhere. But there?s still more of it in some places than others. Unfortunately, legal scholarship usually contains very little art. Or at least, legal scholarship has a hard time seeing itself as an art form. It?s a shame because legal scholarship is as good a medium as any for art?especially conceptual art. After all, every genre has aesthetic qualities, even legal scholarship. If it?s a struggle to make legal scholarship aesthetically pleasing, all the better! Artists have always had to struggle, and there?s no own like a self-own. What?s more, legal scholarship is all about concepts. Usually the concepts are boring and scholastic, but they still matter. There are a lot of mediocre genres. Even if legal scholarship is a mediocre genre, it?s entitled to a little representation, isn?t it, and a little chance? We can?t have only painting, sculpture, and music. Conceptual art is promiscuous. It loves the genre that loves it back.

So, this article is an homage to Ono?s Grapefruit in the genre of legal scholarship. It consists of a number of ?pieces? intended to encourage reflection on the nature and practice of legal scholarship. Of course, it reflects my own particular interests, inter alia discussing the concept of plagiarism, especially as articulated in the context of legal scholarship.

Notably, this is the first article in which I have (intentionally) plagiarized anything. At a certain point, you just have to jump in. For what it?s worth, a considerable part of the plagiarism in this article is self-plagiarism, which is really just plagiarism for plagiarists without the courage of their convictions. But many of the pieces in this article plagiarize other legal scholars. Like any self-respecting plagiarist, I only plagiarized the legal scholars I love the very most. See if you can spot their work. I hope I added something to it.

And then, within the piece, are a long list of “instructions” regarding various topics, including eight such instructions regarding plagiarism — a topic that Frye has also written about extensively, calling into question why plagiarism is considered “the ultimate academic crime,” and suggests that we rethink plagiarism entirely. As he writes in that paper:

Plagiarism norms are primarily an extralegal, inefficient, and illegitimate way for academics to claim property rights in the public domain. Copyright cannot and should not protect ideas, and plagiarism norms are simply copyright by other means. Attributing ideas should be voluntary, not mandatory. Academics should provide citations because they are helpful to readers, not because they are an obligatory form of obeisance. We should encourage people to attribute ideas whenever helpful and appropriate, but we should refuse to recognize the self-interested and unreasonable claims of those who seek to enforce plagiarism norms for their own sake and in their own interests.

Earlier this year, Frye began exploring NFTs, and (among other things) how they fit in under existing law — specifically securities law. He has similarly published another paper, entitled an SEC No-Action Letter Request, in which he explores whether or not selling shares of ownership in the No-Action Letter Request itself is an illegal unregistered security. In order to sell those shares, he has created NFTs associated with the No-Action letter.

Separately, Frye created a bunch of NFTs out of the different “instructions” in the Deodand paper, including the Plagiarism Pieces. This resulted in Josh Lamel, from Insight Public Affairs suggesting that someone should sell plagiarized NFTs of Frye’s NFTs. We have now stepped up to do so.

Because it is plagiarism, and a key point that Frye highlights is that you shouldn’t need to ask for permission, we have not done so — though it certainly appears that Frye endorses this plagiarism, that’s really neither here nor there.

We’ve written plenty about how people overreact to plagiarism in the past, and have noted that plagiarism can often lead to even greater creativity. Often, good plagiarism takes one work and does something else to it, to make it better, or more widely known. We believe we have done that with Frye’s work. His paper, and his NFTs, were fairly boring, typical law review typeface of black letters on a white background. While using his text, we have spiced up all eight of the plagiarism pieces, adding color and (most importantly) animation. Each of the eight NFTs is different, but they are currently being auctioned off, so feel free to own a piece of conceptual art / legal scholarship / plagiarized / case study about plagiarism, ownership, digital ownership and more. Again, the auction will remain live through next Thursday evening.

Filed Under: abundance, brian frye, conceptual art, culture, nfts, ownership, plagiarism, scarcity

'Free' Game Making $300 Million Per Month? But I Thought You Can't Make Money On Free…

from the old-school dept

For most of the first decade of the millennium, we would post over and over again about content business models and how “free” content makes a ton of sense as a component of a business model. And yet, people in the legacy entertainment industry would laugh and laugh, and talk about how “you can’t make money on free.” You even had folks who claimed that if you gave away anything for free it proved you had “no fucking clue” about how to run a business. My favorite may have been Doug Morris, who was boss of Universal Music and then Sony Music, insisting that there was no way anyone in the recording business could make money on “free.”

These days, that’s all looking pretty silly, but just to drive home the point: the insanely popular free video game Fortnite made $318 million last month. Not last year. Last month. And it’s free. Of course, as we’ve always said, the whole point of free is not that free is the business model, but that free is a part of the business model. And that’s exactly how Fortnight works.

Even better, all of that revenue comes from nonessential in-app purchases. You don’t ever need to pay any money to play Fortnite. And, if we went by what the entertainment industry “experts” from years past would tell you, if that’s the case no one will ever pay. Except, obviously, they are, to the tune of over $300 million per month. Why? Because, they’re still buying an actual scarcity: mainly different skins or dances/moves that let them show off. In other words: fashion. Something to make themselves distinct — to stand out. That is a scarcity. Even in a digital world.

So, Fortnite is yet another example of how someone is taking a digital property, and leveraging free to attract a massive audience, and then figuring out ways to charge for a scarcity that people actually want to buy. And people are paying like crazy. So, can we put to rest the idea that you can’t make money off of free yet?

Filed Under: business models, differentiation, economics, fortnite, free, free to play, scarcity

Techdirt Podcast Episode 90: Is Capitalism Over?

from the not-exactly... dept

As technology ushers more and more things towards the realm of “post-scarcity”, an inevitable conversation has arisen around the very roots of capitalism and what this rapid change means for our economic systems at the most fundamental levels. But the answer is far from simple — is capitalism dying? Can it evolve? Is the whole question being framed incorrectly? This week, we discuss the notion of a post-capitalist world, what it might look like, and how close it actually is.

Follow the Techdirt Podcast on Soundcloud, subscribe via iTunes, or grab the RSS feed. You can also keep up with all the latest episodes right here on Techdirt.

Filed Under: capitalism, communism, economics, podcast, scarcity, socialism

Rap Artists Wu-Tang Clan Fight Infinite Goods By Selling One Copy Of Their Next Album… For $1 Million

from the if-you've-got-the-front-rent,-who-cares-about-the-back? dept

There’s a lot of discussion at this site about new business models for artists to combat the tendency of infinite goods (digital files) to bring the market price down to as near zero as possible. Seminal rap act Wu-Tang Clan has gone in the opposite direction. Instead of operating around infinite goods, the group is opting to release its next album in an extremely finite quantity.

Somewhere on the outskirts of Marrakech, Morocco, inside a vault housed beneath the shadow of the Atlas Mountains, there sits an engraved silver-and-nickel box with the potential to spawn a shift in the way music is consumed and monetized.

The lustrous container was handcrafted over the course of three months by British-Moroccan artist Yahya, whose works have been commissioned by royal families and business leaders around the world. Soon, it will contain a different sort of art piece: the Wu-Tang Clan’s double-album The Wu – Once Upon A Time In Shaolin, recorded in secret over the past few years.

Like the work of a master Impressionist, it will truly be one-of-a-kind—in lieu of a traditional major label or independent launch, the iconic hip-hop collective will make and sell just one copy of the album. And similar to a Monet or a Degas, the price tag will be a multimillion-dollar figure.

Rather than allow the market to decide how much the album is worth, the Wu-Tang Clan has circumvented that process by predetermining its going price (which eliminates a whole lot of the “market”). But it’s not a terrible idea, provided it’s able to sell this literally one-of-a-kind album. Securing $1 million up front (and without a label) for an unheard album will allow the group to recoup its costs in short order, rather than having to rely on a slower flow of income. It may work for a group that has achieved nearly legendary status over the course of its career, but it obviously isn’t the sort of thing that would work for many recording artists.

But this isn’t the only revenue stream. The Clan has another offering that will put even more money in its pockets, but it’s also one that could possibly undermine the million-dollar sale.

According to RZA and the album’s main producer Tarik “Cilvaringz” Azzougarh, a Morocco-based part of Wu-Tang’s extended family, the plan is to first take Once Upon A Time In Shaolin on a “tour” through museums, galleries, festivals and the like. Just like a high-profile exhibit at a major institution, there will be a cost to attend, likely in the 30−30-30−50 range.

Visitors will go through heavy security to ensure that recording devices aren’t smuggled in; as an extra precaution, they’ll likely have to listen to the 128-minute album’s 31 songs on headphones provided by the venue. As Cilvaringz puts it: “One leak of this thing nullifies the entire concept.”

The group says this is an attempt at “reconsidering music as art.” That’s the kind of statement that punches the right buttons for creators who feel the internet has robbed them of the ability to make a living, but it’s ultimately as substance-free as any other justification for charging a steep price for infinite goods. This is the sort of statement you can make when a $1 million payoff assures you of success even without album sales. This won’t force a reconsideration of music by the general public. This will only put the new album into the realm of the unattainable, which makes it a luxury good, rather than an artistic statement.

But all in all, it’s not a terrible plan. If the album leaks beforehand, some well-heeled fan may still pick up the tab to get the only legitimate copy of this album, along with its handcrafted storage case. If, by some miracle, the album is purchased and never leaks, someone out there will own the best-kept musical secret of all time. But chances are, the album will make its way to the internet eventually, even if leaks are prevented. People love sharing art, even if they paid $1 million for it.

Filed Under: art, music, scarcity, wu-tang clan

DailyDirt: Food Shortages

from the urls-we-dig-up dept

It’s strange to know that the world actually produces enough food to feed everyone, but losses in distribution and economic issues prevent everyone from eating. There are estimates that the world produces enough food to feed the world’s population about 2-3 times over, and about half of the global food supply is wasted. Still, nearly a billion people are undernourished. If you haven’t lost your appetite yet, here are just a few more factoids on the topic of food shortages.

If you’d like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

Filed Under: food, food waste, onions, rice, rice crisis, scarcity, shortage, water